debtcare.ca

Category: Filing for Bankruptcy

  • Facing Bankruptcy During COVID-19? There are Other Options too.

    If you are faced with tough financial decisions, bankruptcy can seem like the option that will reduce the burden of debt.

    As Bankruptcy Canada puts it, in simplest terms, in personal bankruptcy, you assign everything you own to a Licensed Insolvency Trustee in exchange for the elimination of your debts.

    While many individuals and companies file for bankruptcies, particularly during financial crises, bankruptcies come with their own challenges.

    To begin with, bankruptcy is expensive and can have personal implications if the debt carries director’s liability – such as unpaid source deductions and GST/HST liabilities.

    Also, when you file for bankruptcy, the trustee involved does not represent you. The trustee is an impartial court appointed officer, who has to look out for both your and your creditors’ interests. So, it is always recommended to work with a debt consultant, who can support you through the process.

    Lastly, bankruptcies are likely to cause your credit score to drop to the lowest possible rating at most Canadian credit bureaus.

    This is why it is important to evaluate other options available to you as well.

    Some of these options can not only help you retain your assets but also save your credit rating.

    Mortgage refinancing, for instance, is a popular way to get out of debt.

    When you’re looking to reduce your debt load, having equity can be incredibly beneficial. If you own a home, you can use available equity to consolidate your debts into one payment. This is an effective way to quickly deal with high-interest debt while managing your budget and minimizing the negative impact on your credit score.

    When you have to make one fixed payment on a fixed schedule, it is easier to keep track of what you owe.

    Additionally, given the all-time low interest rates, you could save money on your monthly mortgage payments if you bought your home at a time when interest rates were higher.

    If you do not have home equity, consumer proposals can be a viable option especially when you are facing collection action and have unsecured, non-mortgage debts between $8,000 to $250,000.

    It is a proposal made to your creditors, where your creditors agree to accept a single payment representing a percentage of your overall debt, that you repay monthly, normally over a term of 5 years.

    This helps in consolidating your debt, preventing collection action, and protecting your assets.

    While your credit score does take a hit after you file for a consumer proposal, this is usually temporary. Two years after your proposal is paid in full, your credit score can bounce back.

    Deciding what works for you depends on the level of debt you need to pay off, the worth of your assets, and your current financial standing.

    At DebtCare, we review all these aspects and propose a plan of action that helps you eliminate your debt on terms that are favourable for you. So, if you’re facing insolvency, contact us today for a free consultation on 1-888-890-0888 or visit www.debtcare.ca.

  • Consumer Proposal vs. Bankruptcy – We Break It Down

    Consumer proposal vs. bankruptcy – what is the difference, and which one is the best choice for you? If you want to find out the answer, read on!

    For Canadians struggling with debt, both filing for a consumer proposal and filing for bankruptcy can be a way out. But how can you tell which one is right for your situation? We’re breaking it down.

    We’ll look at:

    • What is a consumer proposal?
    • What is bankruptcy?
    • Consumer proposal vs. bankruptcy – main differences
    • Bankruptcy or consumer proposal – which one is best for you?

    Consumer Proposal

    A consumer proposal is a form of insolvency filing where you make a settlement offer to your creditors. That’s where the name comes from — it is a proposal to creditors from you, the consumer.

    In your proposal, you offer to settle your debts for less than you owe, but more than your creditors would receive if you filed for bankruptcy, instead.

    The majority of your creditors must accept your proposal for it to be approved.

    Generally in a consumer proposal, your assets are not sold off to pay your debts. A consumer proposal is only available for unsecured, non-mortgage debts between $8,000 to $250,000. If you are carrying more debt than that, you might consider another type of proposal, or filing for bankruptcy. You also must be able to demonstrate your ability to repay a portion of your debt.

    Bankruptcy

    In personal bankruptcy, you assign your assets in exchange for the elimination of your debts. Every province has certain exceptions for what you can keep but, depending on the amount of debt you owe, some assets may be sold.

    You can file for bankruptcy if you owe at least $1,000 and are not able to pay your debts. Bankruptcy only deals with secured debts, such as personal loans, credit cards, and tax debt. It doesn’t erase most secured loans, such as a car loan or mortgage, although those assets may be repossessed if you cannot meet those payments.

    To be discharged from a bankruptcy, you must meet a schedule of payments, set out by a Licensed Insolvency Trustee.

    Consumer Proposal vs. Bankruptcy – Main Differences

    Filing for a consumer proposal and for bankruptcy are two different things. The main differences are:

    • In a consumer proposal, you can only file if you owe less than $250,000 in non-mortgage debt. In a personal bankruptcy, there is no limit.
    • A consumer proposal must be accepted by the majority of your creditors. A bankruptcy does not need approval.
    • Filing for a consumer proposal leaves you with an R9 rating on your credit report while you are in the proposal; it is upgraded to an R7 once it is paid off. The R7 stays on your credit report for three years after completion.
    • Filing for bankruptcy leaves you with an R9 credit rating while in the bankruptcy and for seven years after it is discharged (it is never upgraded to a better rating throughout that time).
    • A consumer proposal generally does not affect your secured assets, like your mortgage or car – although this depends on your personal situation.
    • A consumer proposal allows you to rebuild credit faster, particularly if you pay it off quickly.

    Bankruptcy or Consumer Proposal – Which One is Best for You?

    Whether you choose to file for bankruptcy or for a consumer proposal can depend on your circumstances.

    Questions to consider include:

    • How much total debt are you carrying?
    • How much unsecured debt are you carrying?
    • How much are your secured assets worth?
    • Can you demonstrate the ability to repay a portion of your debt?

    It can difficult to answer these questions on your own. The best way to go about deciding which insolvency option is for you – or if there is an alternative debt consolidation method that may work – is by contacting a debt counsellor, such as DebtCare Canada, for a free consultation.

    Having an Advocate on Your Side

    Both a consumer proposal and bankruptcy must be filed through a Licensed Insolvency Trustee (LIT, or formerly known as a Trustee in Bankruptcy). However, if you’re filing for insolvency, it’s also important that you have an advocate on your side.

    While Licensed Insolvency Trustees administer the consumer proposal or bankruptcy, they are not equipped to be this advocate for you. A) They represent both you and the creditor, so they are not entirely on your side. And B) they earn their money based on the size of your filing.

    It’s best to have a debt counsellor – like our experts at DebtCare Canada – on your side during an insolvency filing to ensure you are represented at the table during the filing process. We can make sure you are protected and getting the best deal possible.

    At DebtCare, we will help you decide whether filing for bankruptcy or for a consumer proposal is right for you and be your advocate throughout the entire process. We perform an independent review of your financial situation and make practical recommendations that will work for you.

    Contact us today for a free consultation. Call 1-888-890-0888 or visit www.debtcare.ca.

  • Bankruptcy and Consumer Proposals Rise as Consumer Debt Reaches Record Limits

    Are you struggling with consumer debt? If so, you’re not alone.

    According to BNN Bloomberg, the average Canadian household owes $1.76 for $1 of annual disposable income. The same household devotes $0.15 of every disposable dollar to making principal and interest payments on debt, which is a record high.

    BNN Bloomberg also noted that when you add together consumer credit, mortgage, and non-mortgage debt, Canadians are carrying $2.28 trillion in credit market debt.

    What’s more, beyond just carrying debt, they’re paying the price. The number of insolvencies – bankruptcies and consumer proposals – filed by consumers in 2019 increased from the year before.

    While the numbers for the final quarter of 2019 have not been released yet, as of Q3 2019, Canadian insolvency filings were up to 34,708 — up more than 4,000 over Q3 2018. Of that, the number of bankruptcies rose slightly (from 13,549 to 13,757) and the number of consumer proposal filings rose substantially, going from 16,764 to 20,951.

    Why are more Canadians going into debt?

    According to a survey from Manulife, two in five Canadians believe they will never be debt-free.

    There are many reasons Canadians might currently be struggling with debt. Housing prices are continuing to rise, especially in larger cities like Toronto and Vancouver.

    While interest rates have stayed the same for the past year, the added spikes in 2017 and 2018 still didn’t help for those carrying debt. Some have also speculated that it’s too easy for Canadians to gain access to credit – and spend more than they can afford to pay back.

    For others, job insecurity can be part of it – not enough income to make ends meet. They might be facing job loss, working in a precarious employment situation (like the gig economy) with inconsistent income, or simply not earning enough to afford high housing prices.

    Poor credit habits can hurt your finances, too. While paying only the minimum balance on your credit cards can seem like a good idea, it can actually mean more debt in the long-term.

    Sometimes the moments leading up to major debt troubles are insidious. What can start as a seemingly harmless action can snowball into a much bigger problem.

    What exactly does struggling with debt look like? It could include:

    • Being unable to pay all your bills in full and on time each month.
    • Making only the minimum payments each month.
    • Being unable to make even the minimum payments.
    • Having more debt than income.
    • Always taking out another loan to pay off your old debts, getting into an unsustainable cycle.
    • Relying on credit to pay all your bills because you don’t have enough funds in your bank account.
    • Consistently being unable to afford the items you need to achieve a daily quality of life – pay for groceries, afford your rent, and so on.
    • Living paycheque to paycheque without knowing how you would afford an emergency.
    • And more…

    This might vary depending on your exact circumstances, but any of these could be a precursor to bigger problems down the road.

    How to deal with debt before major damage is done

    The sooner you realize you have a debt issue, the more likely you are to resolve it before major damage is done to your quality of living.

    When you file for insolvency, your credit score takes a big hit. While this is sometimes the best option, and it is possible to recover over time, if you tackle your finances early you minimize the need for this type of action.

    Some steps you can take to resolve problem debt include:

    • Creating a realistic budget and looking for ways to reduce your current expenses, then putting the savings towards paying off your debt.
    • Honestly assessing where your money is currently going and eliminating wasteful spending.
    • Practicing good financial habits, like always paying your bills on time and in full.
    • Not relying on credit. While some use of credit is good for your credit score, you don’t want to be using it because you don’t have the money elsewhere.
    • If you have an income problem, looking for ways to earn more – either through asking for a raise, finding a new job, or getting a part-time job.
    • Seeking out debt consolidation methods, such as mortgage refinancing.

    While filing for insolvency is one option, it’s not the only option – especially if you tackle the problem early.

    In 2020, make your resolution to figure out your finances for good. Debt freedom is possible with a little planning. There’s no point feeling bad about the circumstances that got you into debt. Instead, realize you’re not alone and focus on finding the way out.

    That’s where we come in. At DebtCare Canada, we will assess your situation and make recommendations to deal with debt. We’ll go over your options and create a realistic plan for success.

    Contact us today for a free consultation. Call 1-888-890-0888  or visit www.debtcare.ca.

  • How to Save Your Home During a Financial Crisis

    In a financial crisis, all of your assets may be in jeopardy – especially your home.

    A financial crisis can take many forms: an unexpected bill, change in interest rates, job loss, buildup of long-term debt, and more. But one of the hardest to deal with — and most critical – is a CRA tax debt.

    When you owe the Canada Revenue Agency (CRA) money, they can act swiftly and aggressively. The CRA has many debt collection tools in their arsenal, including putting a lien on your house.

    Particularly in cases of tax debt, many folks freeze and don’t know what to do.

    This is mistake! When it comes to a financial crisis — especially a tax debt – time is not your friend. A lien on your house is game over.

    When there is a financial crisis, saving your home means acting fast.

    The first step is to determine your home equity position. A good financial advisor will be able to access an automated valuation model (AVM) to calculate the actual quick sale market value of your home against what you owe.

    The next step is knowing ALL of your financial options and considering the pros and cons of each.

    Option 1: Refinancing Your Home

    Pros: Can deal with your financial crisis without affecting your credit score.

    Cons: The viability depends on the equity available in your home. It isn’t always a long-term solution.

    When evaluating refinancing your mortgage, ask:

    • Do you have enough equity in your home to refinance?
    • If you do refinance, is it just a band-aid solution or does it fully resolve the issue?

    Sometimes people will refinance their homes to quickly deal with the issue at hand, but it doesn’t resolve the long-term one. So, a financial crisis is still looming, but they will not have equity to deal with it the next time it becomes urgent.

    If refinancing is not a long-term solution, there are other options available.

    Option 2: Filing for a Consumer Proposal

    Pros: Stops collection action and deals with debt quickly. Payments are geared to income. Your assets are generally not affected.

    Cons: Only available for unsecured debt up to $250,000 (excluding mortgage). Leaves you with an R7 credit rating, meaning you will need to repair credit afterwards.

    In a consumer proposal, you make an offer to your creditors to settle your debts for less than what you owe. The offer must be accepted by the majority of your creditors.

    In most cases, you can keep your home when you file for a consumer proposal, as your assets remain untouched. But this depends on your mortgage payments being kept up to date and whether you have enough income to continue paying your mortgage after the proposal.

    Option 3: Filing for Bankruptcy

    Pros: No limit to the amount of debt you can file for bankruptcy. Like with a consumer proposal, payments are geared to income and collection action is stopped.

    Cons: Leaves you with an R9 credit score. May put your assets at risk, depending on your financial situation.

    In a bankruptcy, assets are often sold to pay off debts – including in some cases your house. However, this doesn’t always happen; you may be able to keep your home depending on the amount of equity you have available.

    If you are considering filing for bankruptcy, talk to a financial advisor about options for keeping your home.

    Filing for a consumer proposal or for bankruptcy can often seem scary. But in a financial crisis, it could be your best option. If there is no lien on your house, both filing for a consumer proposal and bankruptcy could protect your home, depending on your financial situation.

    Plus, both have payments that are geared to your income, so you will be able to afford the monthly fees without getting into another financial crisis.

    One downside to both is the hit to your credit score and the time it can take to rebuild credit. But that can still be a better option than losing your home. A good financial advisor will structure your consumer proposal or bankruptcy based on equity.

    Whether you choose to refinance or are considering filing for a consumer proposal or bankruptcy, it is important to weigh your options carefully but also quickly (as we said, time is of the essence during a financial crisis).

    That means talking with a financial advisor who can look at your whole financial situation and help determine the best course for you.

    At DebtCare Canada we are experienced in evaluating the pros and cons of all options – and doing everything we can to save your home.

    If you’re facing a financial crisis, don’t delay. Contact us today for a free consultation. Call 1-888-890-0888 or visit www.debtcare.ca.

  • Protecting Your Home Through Financial Restructuring

    Having financial troubles can be stressful no matter where you are in life – but it’s doubly so if you own a house.

    There’s a common fear that financial restructuring will mean losing your home. Fortunately, there are ways to protect against this.

    The first thing to do is to make sure that you stay up-to-date with your mortgage payments. If you haven’t defaulted on your mortgage, your chances of keeping your home through a financial crisis increase greatly.

    Let’s look at some of the financial restructuring options you might have when you own your home…

    1. Debt Consolidation

    As long as your mortgage payments are up to date, a debt consolidation loan can be a good way to deal with outstanding unsecured debt.

    Unsecured debt might be credit card bills, lines of credit, your cell phone bill, etc. It is anything not tied to collateral – so your mortgage and car loan would not fall under this umbrella.

    Unsecured debt usually has a high interest rate, making your monthly payments even more expensive. This is where a consolidation loan can help. You can use the money to pay off your unsecured debts, and then pay back the consolidation loan at a fixed interest rate over a manageable schedule.

    You won’t be paying as much in interest, so you can use the extra money to keep your mortgage payments up to date.

    1. Home Equity

    Sometimes your home can actually be a source of income for financial restructuring. If you have equity available, you might be able to use it to pay off your outstanding debts – essentially, this is a form of a consolidation loan.

    Again, this is dependent on your mortgage payments being current and made on time every month.

    1. Filing for a Consumer Proposal

    If you don’t have enough equity available or aren’t eligible for a consolidation loan, filing for a consumer proposal is another option.

    Consumer proposals deal with unsecured debt up to $250,000 (excluding your mortgage). In a consumer proposal, you make an offer to your creditors to settle your debts for less than what you owe. This offer must be accepted by the majority of your creditors and you must be able to prove they’ll get more money than they otherwise would if you filed for bankruptcy.

    In most cases, you can keep your home when you file for a consumer proposal, as your assets remain untouched. Again, this depends on your mortgage payments being kept up to date and is based on you having enough income to continue paying your mortgage after the proposal.

    A good financial advisor will structure your consumer proposal based on equity.

    If you have more than $250,000 in unsecured debt, you might file for another kind of proposal or bankruptcy instead.

    1. Filing for Bankruptcy

    Filing for bankruptcy is where most people fear they will lose their home. This is because in a bankruptcy, assets are often sold to pay off debts – including in some cases your house.

    However, this doesn’t always happen – and you may able to keep your home depending on the amount of equity you have available.

    If:

    • You don’t have much equity (this varies depending on province), and
    • Your mortgage payments are up to date

    your ability to keep your home increases substantially.

    If you do have a lot of equity, you may still be able to keep your home by repaying your equity through borrowing money, or through a second mortgage.

    A good financial advisor, like those at DebtCare Canada, will also help you structure your bankruptcy based on equity.

    1. If You Can’t Afford Your Mortgage…

    As we’ve discussed, keeping your home through financial restructuring largely depends on being able to continue making your mortgage payments.

    If your mortgage is up-to-date, you’re less likely to lose your house. But what if even after consolidating debt and making a budget you don’t have enough income to make your mortgage payments?

    This can be a whole other issue – but it’s important to remember that you still have options. You might need to:

    • Make more income through asking for a raise or getting a second job.
    • Or sell your home and downsize to a smaller mortgage.

    While selling your home may not necessarily be the same thing as keeping it, it can be preferable to losing your home through having it seized. In this option, you would still retain the profits from the sale, and you could use the money to move into another, less expensive property.

    A good financial advisor, like the ones at DebtCare Canada, can help you sort through your financial restructuring options, so your home is protected.

    Contact us today for a free consultation. Call 1-888-890-0888 or visit www.debtcare.ca.

  • Thinking of Filing for Bankruptcy or a Consumer Proposal in Canada? You’re Not Alone

    Have you considered filing for bankruptcy or for a consumer proposal in Canada? If so, you’re far from the only one.

    Insolvency statistics show that bankruptcies and consumer proposals continue to be popular debt management options for Canadians throughout 2018.

    Here’s exactly how many Canadians are filing for bankruptcy or filing for a consumer proposal:

    2017 (Total Across Canada)

    Total: 125,807

    Bankruptcies: 60,669 (Personal Bankruptcies: 57,969, Business Bankruptcies: 2,700)

    Consumer Proposals: 65,138 (Personal Consumer Proposals: 64,229, Business Consumer Proposals: 909)

    Top Three Highest Provinces:

    Quebec – Total: 43,731, Bankruptcies: 24,210, Consumer Proposals: 19,521

    Ontario – Total: 39,045, Bankruptcies: 15,968, Consumer Proposals: 23,077

    Alberta – Total: 13,481, Bankruptcies: 5,139, Consumer Proposals: 8,342

    First Quarter of 2018: January, February, March

    Total (Canada): 31,327

    Bankruptcies: 13,863 (Personal: 13,163, Business: 700)

    Consumer Proposals: 17,464 (Personal: 17,234, Business: 230)

    Top Three Highest Provinces:

    Quebec – Total: 11,301, Bankruptcies: 5,664, Consumer Proposals: 5,637

    Ontario – Total: 9,507, Bankruptcies: 3,638, Consumer Proposals: 5,869

    Alberta – Total: 3,463, Bankruptcies: 1,227, Consumer Proposals: 2,236

    Second Quarter of 2018: April, May, June

    Total (Canada): 33,534

    Bankruptcies: 15,450 (Personal: 13,163, Business: 700)

    Proposals: 18,084 (Personal: 17,234, Business: 230)

    Top Three Highest Provinces:

    Quebec – Total: 11,109, Bankruptcies: 5,930, Consumer Proposals: 5,179

    Ontario — Total: 10,435, Bankruptcies: 4,202, Consumer Proposals: 6,233

    Alberta – Total: 3,884, Bankruptcies: 1,343, Consumer Proposals: 2,541

    Compared to the first and second quarters of 2017, the first half of 2018 is keeping pace. The total number of insolvency filings are slightly down, as are the total number of bankruptcies filed. However, the total number of consumer proposal filings are slightly up, indicating that more Canadians are choosing this option.

    If you are considering filing for a consumer proposal or for bankruptcy, it’s important to know the difference.

    Consumer proposals:

    • Are for unsecured debts less than $250,000 (not including mortgage debt).
    • Make a settlement offer to your creditors that the majority of creditors must accept.
    • Generally, leave assets intact.

    Bankruptcies:

    • Are for any amount of debt.
    • Clear most unsecured debts and potentially some secured debts, such as a mortgage or car loan, if the assets are seized.
    • Could result in losing assets, such as your home or your car.

    For more differences, see this blog: How is a Consumer Proposal Different from a Bankruptcy?

    Both consumer proposals and bankruptcies must be filed with a Licensed Insolvency Trustee (LIT, or formerly known as a Bankruptcy Trustee). However, they will take a portion of the fee that you pay. They aren’t necessarily ‘on your side’ — they are more of a facilitator for the process.

    Before you file, you need an advocate who represents you and only you. At DebtCare, we provide just that. We can represent you when filing for bankruptcy or for a consumer proposal, and we can also make sure you have eliminated all other debt consolidation strategies before filing.

    Contact us today for a free consultation. Call 1-888-890-0888.

  • Ontario Bankruptcy Trustees – Why You Need to Hire Someone to Represent You First!

    It may seem strange to say, but if you’re looking for an Ontario Bankruptcy Trustee, you need protection.

    Ontario Bankruptcy Trustees (officially called Licensed Insolvency Trustees, or LITs) are the only financial professionals in the province who are authorized to administer consumer proposal or bankruptcy proceedings. They’re an independent third-party who can make a deal with your creditors in a consumer proposal or file your bankruptcy — but it comes at a price.

    When you file for a consumer proposal or bankruptcy, your Bankruptcy Trustee won’t charge you an upfront fee. But they have to get paid somehow. And that somehow comes from a percentage of your debt. Essentially, the more you pay, the more your Bankruptcy Trustee makes.

    This means that if you disclose certain assets or information to your Bankruptcy Trustee, they will likely have you declare them in your bankruptcy, even if there is a legal way to make that asset exempt. Your Bankruptcy Trustee probably won’t tell you about loopholes that exist if it doesn’t benefit them.

    This isn’t to say that Bankruptcy Trustees are bad — far from it. They’re not vultures who work only for your creditors. It might be more accurate to describe them as referees at a hockey game. They’re working to make sure the rules are upheld by both sides, but if you break the rules — even if you unknowingly omit information — they’re going to penalize you (just as they would your creditors) and they’re also not 100% on your side.

    If you’re filing for bankruptcy, you need someone to represent you — and only you. You could hire a lawyer, but that will often be too expensive to afford if you’re already in a tough financial position. Even if you qualify for Legal Aid, certificates are issued depending on your legal issue and typically assisting with a bankruptcy isn’t covered.

    But there is another solution. Just as there are accountants and tax lawyers who represent people when they have a tax problem, there are financial consultants who can represent you if you have a debt problem. They can prepare your information, educate you about your choices, administer your paperwork, and hold your hand through the process of a bankruptcy or consumer proposal, ensuring that you get a fair deal that protects you.

    DebtCare Canada is one of these consultants. For more information about Ontario Bankruptcy Trustees, their role in a debt restructuring, or to get representation in a bankruptcy or consumer proposal, call us for a free consultation: 1-888-890-0888.

  • Debt Relief in Canada Blog Series Part 3 – Are There Consequences to Filing for Bankruptcy?

    There are many options for debt relief in Canada, and one of the most common is bankruptcy. If you have financial problems, bankruptcy may seem like a scary option because of the consequences that many people associate with filing for bankruptcy. Hopefully this article will help you to understand bankruptcy better and determine if in fact it could be an option for debt relief that you should consider.

    Bankruptcy is generally filed by people who have limited income or significant debt in relation to their income. Most first-time bankruptcies last either 9 or 21 months. When an individual files for bankruptcy, a trustee in bankruptcy will assess the bankrupt’s household income, assets, liabilities and personal circumstances. Personal circumstances include the number of people in the household and the number of dependents that the bankrupt has. Based on bankruptcy guidelines, if your income, once all factors are considered, is below a specified threshold, then the monthly payments in bankruptcy will last for 9 months. If the income is above a specified threshold, then it will be determined that the bankrupt has surplus income. This will result in higher payments in bankruptcy over a specified period of time, in most cases 21 months.

    Some of the pros of filing for bankruptcy are:

    • Immediate relief from collection action from unsecured creditors (such as wage garnishments).
    • A monthly payment that is less than what you are likely contractually obliged to pay to your creditors now.
    • The opportunity for a fresh start to get out of debt in a short period of time, enabling you to rebuild your credit and finances.

    Many people don’t know that, in many cases, when you file for bankruptcy you are able to keep your home and vehicle.

    Some of the cons of filing for bankruptcy include:

    • If your financial situation improves during your bankruptcy you could be subject to additional surplus income. If there was no surplus income when you filed for bankruptcy and your bankruptcy repayment is over 9 months, surplus income during bankruptcy could result in your monthly payment in bankruptcy being extended to 21 months.
    • The bankruptcy will remain on your credit report for 6 years from the date it is discharged. With that said, most financial institutions will do business with a bankrupt individual who has 2 years of re-established credit after bankruptcy.
    • Having a number of assets with equity in them will complicate things. In this case, a consumer proposal may be a better option than bankruptcy.

    Bankruptcy is a very viable debt relief option in Canada, and while there are some consequences of filing for bankruptcy, in many cases there are many more benefits. Bankruptcy is an option for debt relief in Canada that can provide you with immediate relief, not only from collection action, but also the stress that accompanies a financial problem. If you have creditors that are currently after you, perhaps even suing you, this is relief that can provide you with a breath of fresh air, enabling you to think clearly again and get your personal and financial situation back on track.

    For more information about options for debt relief in Canada or to see if you are a candidate for bankruptcy please call DebtCare at 416-903-4000 or visit www.debtcare.ca.