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Category: Blog

  • Getting Back to Basics: Ontario Bankruptcy Trustees and Their Role in Bankruptcy

    debtcare22016 is officially in full swing, and for many of us those New Year’s resolutions are still weighing heavily on our minds. If one of your resolutions for this year is to get your finances back on track, and you’re wondering about your options, we are here to help clear things up! This week we are getting back to the basics, talking about Ontario bankruptcy trustees and their role in bankruptcy. If this is a route you are considering, read on for some important information!

    When you decide to declare bankruptcy, you may be overwhelmed by the information available – a great deal of which likely leaves you with further questions. Here are some of the answers you are likely looking for.

    Firstly, what is an Ontario bankruptcy trustee and what do they do? A bankruptcy trustee is an individual appointed by the Superintendent of Bankruptcy and is a court official with the role of administering bankruptcies and consumer proposals. This individual does not represent the creditor or person who owes, they simply administer the estate according to the law. Their job is to follow that law, getting a fair deal for you AND your creditors.

    Reading carefully, you may have noticed that we said you AND your creditors. Their primary concern is not actually to get you the best deal, but rather to get one that benefits you and your creditors, and ultimately, serves their own interests.

    This is because, in bankruptcy and consumer proposal negotiations, everything is based on income so the trustee makes things very black and white. This may involve asking you for things that are not legally relevant to learn more about you. This information may then be used to benefit your creditors, even though you were not obligated to provide it – knowing what is required and what is not can help you protect yourself.

    Since a bankruptcy can’t be negotiated without an Ontario bankruptcy trustee, what options do you have? Well, you can choose to have a representative in your corner, one who knows the ins and outs of the law and how it provides you with protection. The best advice? Don’t go directly to a trustee. As mentioned, they advertise as though they are the ultimate solution for you, but their goal is not so singularly focussed.

    Once you are in a bankruptcy or proposal, there is no way out until you are discharged, and so ensuring the negotiations work in your favour is crucial. A representative can help to achieve this.

    Want to speak with someone before you go to a trustee, someone who can negotiate on your behalf, or just answer some of your many questions? DebtCare is here to help. Call us today at 1-888-890-0888.

     

  • Is a Debt Consolidation Loan the Answer to Holiday Debt?

    debt2You made it through the holidays and now the credit card bills are rolling in. You went a little over your original holiday budget (don’t we all?), and now the credit cards are maxed out with no real way to pay them off. Perhaps you’ll just make the minimum payments for a while, until you’re back on your feet and feeling more secure – but will that ever happen? Do most of us actually have that extra cash each month to cover those bills? Probably not, since we wouldn’t rely so heavily on credit cards for holiday purchases if we did.

    Ok, so what is the problem with just paying the minimum payment? At least the bill is being paid, right? Sure, you’re paying the bill, but those monthly payments are comprised mainly of interest, meaning your actual balances decrease by mere pennies – and don’t ever really go down.

    This seems pretty negative so far, we know, but it is about to get better. Instead of just paying the minimum payments and not getting anywhere, consider a debt consolidation – this is a great way to save interest and get rid of those balances.

    If you own your own home, you’ve got access to a consolidation product that can save you a lot of money and time. Using your home is one of the cheapest ways to consolidate debt – but a regular mortgage can mean long terms and higher interest. Instead, go for one that is handled more like a loan.

    For example, if $20,000 is required to pay off your debt, and you’re considering a normal second mortgage, your broker will amortize that debt into the first or second mortgage and stretch it over 25 years. That means that you are paying interest on $20,000 for 25 years – when that is largely unnecessary.

    Instead, when you work with a company that finds a mortgage product that works more like a loan, one that does not involve your first mortgage in the process, the issues with amortization and interest disappear. For example, a 5 year amortization and 5 year “open” term mean the debt is done in 5 years or less at your option, your first mortgage is not disrupted and you are not paying that interest for a long period of time – and that interest is lower than most other debt consolidations because it is a mortgage.

    If you want to start 2016 on the right track financially, a debt consolidation loan may just be the answer to dealing with those holiday bills – and a mortgage that is structured more like a loan is a great way to do it!

    For more about a mortgage-style debt consolidation loan please call DebtCare today at 1-888-890-0888.

     

  • True or False: Your Canadian Trustee in Bankruptcy Represents YOUR Creditors in a Consumer Proposal?

    debt2Bankruptcy is often perceived as scary – a last resort option for those that are in dire financial straits. The truth, however, is far less terrifying. Average Canadians are turning to bankruptcy as a viable debt relief solution far more often, and for good reason: it can stop collection action and stop penalties and interest. The scary part though is not knowing who to turn to, and thinking that a Canadian trustee in bankruptcy is your only option.

    A Canadian trustee in bankruptcy is appointed by the Superintendent of Bankruptcy and is regulated by the government. They are a court officer and appear in court. They administer the Bankruptcy Act.

    However, when it comes to representation, they are not like a lawyer or accountant who represents you. A trustee represents your estate, so essentially, your money – but once you file for bankruptcy, that money is no longer yours, it becomes the estate itself.

    During the bankruptcy process, a trustee will attempt to administer the estate, acting for both you and your creditors. That being said, they have as much of an obligation to make a fair deal for your creditors as they do for you.

    Some additional catches:

    • In the case of consumer proposals, the more a trustee negotiates for your creditors, the more they earn – so it is in their best interests to negotiate a higher amount.
    • There is no confidentiality – if you tell them something that relates to your filing, it is the same as telling your creditors and could result in financial consequences.
    • If you earn more money or come into money – they will be the first ones to have their hands on it to the benefit of your creditors.

    Again, consumer proposals and bankruptcies may seem scary – we may not seem to be helping so far, but in reality they are great solutions – dealing with trustees is what can become problematic.

    What can you do to protect yourself and your assets with either of these scenarios? Be represented – choose a representative who knows bankruptcy and have an open and transparent conversation with them. Let them structure your bankruptcy or proposal, negotiate with the trustee on your behalf and manage the process for you – since they actually represent you, the only person they are concerned about is you! You’ll end up with less stress and the best deal in the circumstances.

    If you are considering filing for bankruptcy or filing a consumer proposal, don’t deal directly with a Canadian trustee in bankruptcy. Call DebtCare instead. We represent you. 1-888-890-0888.

  • Get Ready for 2016

    2016 is here! This year, make getting your finances back on track your goal – and then make it a reality! Schedule a free consultation to review your credit and finances to come up with a financial plan for the New Year!

    At DebtCare Canada, we can help you ring in the New Year with a plan to get rid of debt and rebuild your credit. Call us today at 1-888-890-0888.

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  • Merry Christmas from DebtCare Canada

    From the entire DebtCare team, we wish you all the best for the holiday season. May your Christmas be filled with love and laughter, food and friendship!

    Merry Christmas!

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  • Unexpected Wage Garnishment During the Holidays – What You Can Do Now

    debtcare2When you owe a creditor, but are behind with payments, or not making payments at all, you may be facing harassing collection calls, or worse, collection action, which may come in the form of an unexpected wage garnishment. This time of year, the last thing someone wants before the holidays is a wage garnishment.

    Any creditor can begin garnishment proceedings against someone for unpaid debts. Collection agencies, the Canada Revenue Agency, credit card companies, payday loan lenders, or any creditor can enforce collection through a wage garnishment – although these proceedings may differ depending on the creditor.

    There are 2 common types of garnishments – those that require a court order, and those that do not.

    Court imposed garnishments are generally issued when a creditor sues you and is awarded judgement. This happens when you default on a loan, and after several attempts to obtain what is owed, your creditor will head to court. Family responsibility payments are also an example of court imposed wage garnishments.

    Non court-imposed garnishments are generally issued by the Canada Revenue Agency or other government bodies when a debt is owed – and for these organizations, no court approval is necessary.

    What happens when wages are garnished? Once your employer receives notice of the order, they are required by law to withhold a certain amount (sometimes up to 50%) and submit it to be used to pay your creditor.

    What can you do if your wages are already being garnished? There are only 3 ways to stop any garnishment:

    • Negotiate an arrangement with the person who placed the garnishment – this may include paying the debt in full
    • Go to court and ask a judge to remove or reduce the garnishment
    • File a consumer proposal or bankruptcy

    Let’s look at each one.

    Negotiate an arrangement with the person who placed the garnishment – this one is dangerous because your creditor may request further financial disclosure in exchange for temporary voluntary payment arrangements. This information may be used against you later or the creditor may demand an arrangementthat they know you can’t meet so they can go after other things and prove that they showed ‘good faith’ negotiating with you. Be very careful.

    Go to court and ask a judge to remove or reduce the garnishment – you will have to prove why you deserve to have the garnishment removed, and you may need legal representation. This can be an expensive option and there are no guarantees.

    File a consumer proposal or bankruptcy – this could have some temporary impacts to your credit, but will immediately stop a garnishment, interest, and penalties, as well as provide for a single monthly payment and sometimes a debt reduction.

    Often the path of least resistance is the cheapest and the least stressful.

    If you are facing an unexpected wage garnishment as a late holiday gift, call DebtCare Canada today. We can help get it lifted. 1-888-890-0888.

     

  • Happy Holidays from DebtCare Canada

    The team at DebtCare Canada wishes you and your loved ones a very festive and joyous holiday season! Warmest thoughts and best wishes for the New Year – may it bring happiness, peace, success, and prosperity for all!

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  • 12 Days of Christmas – How to Rebuild Your Credit and Finances DebtCare Style

    debt1The holiday season is upon us, and in the spirit of the season we’ve created our very own version of the 12 Days of Christmas, based on how to rebuild your credit – with Mr. Ebenezer Scrooge as the gift-giver (after all, who better to give financial advice than one who is good with their money). It may not sound as catchy or rhyme as well as the original, but when you follow the advice, you can really cut down debt and start rebuilding your credit! Enjoy – and good luck!

    On the first day of ChristmasMr. Scrooge gave to me, an app to organize my expenses!

    On the second day of Christmas Mr. Scrooge said to me, log everything you spend your money on!

    On the third day of Christmas Mr. Scrooge said to me, create a realistic budget from that log!

    On the fourth day of Christmas Mr. Scrooge said to me, now reduce those expenses by 10%.

    On the fifth day of Christmas Mr. Scroogesaid to me, request your credit report!

    On the sixth day of Christmas Mr. Scroogesaid to me, stop applying for new credit!

    On the seventh day of Christmas Mr. Scroogesaid to me, try not to use your credit to finance your Christmas shopping!

    On the eighth day of Christmas Mr. Scroogesaid to me, be as real about your debt as you can be (look at your total debt and divide it by 48 – that is what you would have to pay monthly to be out of debt in 4 years interest free. If you fell off your chair at the size of this monthly payment you may want to review consolidation options.).

    On the ninth day of Christmas Mr. Scroogepresented to me, several viable debt consolidation options.

    On the tenth day of Christmas Mr. Scroogesaid to me, find a financial professional you can trust.

    On the eleventh day of Christmas Mr. Scrooge said to me, vet that professional to make sure they’re legit (he also suggested looking at a representative -not a bankruptcy trustee – someone who will represent YOU – not your creditors).

    On the twelfth day of Christmas Mr. Scrooge said to me, take all of these tips and start to rebuild!

    Ok, we get it – this was a rather unconventional way of presenting our best advice on how to rebuild credit – but the advice is real. Taking a good, hard look at your debt, figuring out where you can cut expenses, and taking the steps to find the best debt professional and the most viable debt relief options, including a mortgage, a consolidation loan, a consumer proposal or bankruptcy, really are the best ways to get back on track financially.

    At DebtCare Canada, we are committed to helping you regain control of your money. If you are looking at ways to rebuild credit, call us today at 1-888-890-0888.

     

  • Something Big is Coming!

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    DebtCare is getting readyto roll out a brand new programto help you take on the mighty credit reporting agencies an
    d fix errors on your credit report, repair bad credit and get back to a place where the banks are competing for your business! We can help you deal with the stress of errors on your credit report – giving you time to focus on more important things!

    Want more info? Call us today at 1-888-890-0888.

  • In the News: Canadian Economy Headed for Trouble – What Can the Average Family Do?

    debtcare1We’ve been hearing murmurings for months now about the state of Canada’s economy – according to economists, we are headed for trouble, and that could mean heaps of financial trouble for the average Canadian household – particularly those struggling with debt.

    According to a recent CBC News article, “Canada’s Economy ‘Dead in the Water,’ Headed Toward Recession,” those murmurings are actually more than just murmurings: http://www.cbc.ca/news/canada/manitoba/canada-s-economy-dead-in-the-water-headed-toward-recession-1.3099645.

    Is Canada headed for a recession? The article states: “Recessions are defined as two consecutive quarters of negative growth. Recently, we learned from Statistics Canada that Canada’s economy shrank between January and March, the biggest decline in GDP since 2009, and the first contraction in the last four years. In fact, the economy contracted in all three months.” So, in a word, yes. It looks as though Canada’s financial future is a bit murky to say the least.

    This prospect is a result of a number of factors: private sector investment has declined dramatically as a result of the oil crisis. Consumers are also cutting their spending dramatically (lowest level since 2009) and governments are decreasing spending as well. The Bank of Canada has dropped interest rates twice this year so far, and this is bound to make an impact too, although for better or for worse has yet to be determined.

    So what can the average family do to combat this challenge? If a recession is in fact in Canada’s future, the best thing to do right now is get finances in order, pay off debts, deal with bad debts, and start saving if possible.

    For many Canadians, this may seem easier said than done – after all, the average Canadian household is sitting at just under $100,000 in debt, according to another recent CBC Newsarticle. However, taking a few simple, yet significant steps, can help you reduce your overall debt, deal with collection action, and help you better manage financially.

    Want to know more about how to get your finances back on track before a recession hits? DebtCare Canada can help. Call us today at 1-888-890-0888.