Category: Brandon Blog Post

Welcome to our weekly blog on financial matters focusing on debt, debt reduction and alternatives to bankruptcy. Our blog is written by our Senior-Vice President, Brandon Smith, who is a licensed trustee in bankruptcy, hence the title, Brandon’s blog.

Brandon writes on topics of interest for individuals and businesses. We hope that you enjoy Brandon’s blog, visit every week to see the new Brandon’s Blog and spend time on our website learning from the information we provide about bankruptcy, debt consolidation, debt settlement, consumer proposals, restructuring and receivership. We also hope you will spend some time on our website – www.irasmithinc.com, finding out more about our Firm and people.

At Ira Smith Trustee & Receiver Inc., we want to help people for Starting Over, Starting Now, living a debt free life.

Brandon Blog Post

DECLARING BANKRUPTCY IN CANADA: NEVER WORRY WHAT TO DO AGAIN WITH THESE AWESOME TIPS

Post author By Brandon Smith
Post date January 11, 2021

Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

If you would prefer to listen to the audio version of this declaring bankruptcy in Canada Brandon Blog, please scroll to the bottom and click play on the podcast.

***Declaring bankruptcy in Canada*: Introduction**

Declaring bankruptcy in Canada is a legal process through which you may be discharged from your financial obligations (with certain minor exceptions). Its purpose is to permit an honest but unfortunate debtor to obtain a discharge from many financial debts, based on affordable conditions.

The Office of the Superintendent of Bankruptcy (OSB) is charged with the administration of the Bankruptcy and Insolvency Act (Canada) (BIA), the Companies’ Creditors Arrangement Act (CCAA) and their respective rules. All documents associated with filings under either of those Acts can be found at the OSB’s internet site. The OSB likewise licenses and supervises the actions of licensed insolvency trustees (LITs ). LITs are accredited to:

administer the estates of bankrupts;
manage alternatives to bankruptcy such as consumer proposals and commercial proposals in order for debtors to get creditor protection and restructure in order to avoid bankruptcy; and
serve as a monitor under the CCAA.

When can you declare bankruptcy in Canada?

Any insolvent person in financial difficulty can declare bankruptcy in Canada any time through a bankruptcy assignment after they have seen a licensed insolvency trustee and made suitable arrangements for the Trustee to administer handle the bankruptcy administration. The bankruptcy trustee prepares the necessary documents for the debtor to sign for filing for bankruptcy.

The licensed trustee then files certain legal documents with the OSB. The OSB then issues its Certificate to evidence the bankruptcy of the person or company. The date and time indicated on the Certificate are when a voluntary bankruptcy starts.

If you are not able to get a LIT to accept your data, or if you cannot afford to work with a LIT in order to declare bankruptcy in Canada, the OSB’s Bankruptcy Assistance Program might have the ability to help. This is provided that you are not and have actually not just recently been, involved in commercial activities or you are not in jail.

What happens when you declare bankruptcy in Canada?

There are three different avenues that can have someone declare bankruptcy in Canada:

Voluntary assignment – A financially troubled insolvent person or company can make a voluntary assignment in bankruptcy. This is where they voluntarily make a general assignment in bankruptcy for the general benefit of all of their creditors.
Bankruptcy application – A creditor who is owed at least $1,000 on an unsecured basis submits an application to the court for obtaining a bankruptcy order against the debtor and the debtor’s property.
Deemed bankruptcy – When a debtor who has made the choice to start an insolvency process under the BIA to gain debt relief through trying to restructure their unsecured debt, has fallen short to satisfy the requirements for:
1. submitting a Division I proposal;
2. gaining the necessary votes in favour of the proposal from the unsecured creditors; or
3. obtaining court approval for the proposal.

Under a deemed bankruptcy, the moment the debtor fails in one of these ways, the BIA says that the debtor is deemed to have made an assignment in bankruptcy.

The bankrupt is able to earn a living after filing for bankruptcy. For this objective, the bankrupt can work or run a company, after the bankruptcy event. However, an undischarged bankrupt cannot be a director of a company. Also, upon the onset of the bankruptcy, the debtor must turn over to the licensed insolvency trustee, any shares of companies owned by the bankrupt.

The Trustee will send a notice to your creditors informing them of the bankruptcy. If there needs to be a meeting of creditors, the Trustee will hold it. The Trustee will also provide the bankrupt person with two credit counselling/financial counselling sessions with an individual who is an OSB qualified credit counsellor from the Trustee’s office, as part of the overall bankruptcy administration.

As you can see, not every way of declaring bankruptcy in Canada is totally voluntary.

Declaring bankruptcy in Canada: What assets do you lose in bankruptcy?

One of the most important tasks a Trustee has in the entire personal bankruptcy process or corporate bankruptcy process after the debtor chose declaring bankruptcy in Canada is to:

take an inventory of the debtor’s assets;
make sure they are physically secure and insured;
formulate a plan to sell the assets for the most amount possible under the circumstances;
review the financial affairs of the bankrupt, including the household income and financial situation of the bankrupt in a personal bankruptcy filing, and prepare a report to the creditors; and
then pay a dividend to the creditors.

There are however certain exemptions allowed for people. Few are based on federal law. Most are based on provincial law. So exempt assets may differ from province to province. In Ontario, assets that are exempt, and therefore not subject to seizure by a Trustee, are:

The equity in your home of no greater than $10,000.
A vehicle with an equity value of no more than $6,000.
Garments and medical/dental aids.
Household furnishings up to a worth of $13,100.
Tools of the trade with a value of no greater than $11,300.
Pension plans, RRIF, RRSP (other than any kind of RRSP payments made within 12 months of the date of bankruptcy).
Farmers– no greater than $29,100 for animals and also tools & equipment.

Even though someone has decided that filing bankruptcy is the route they must go, there are certain assets they will not have to give up.

Declaring bankruptcy in Canada: Does Bankruptcy clear tax debt in Canada?

The short answer is yes. Income taxes payable calculated on your tax return but not paid is a type of debt that is released when a person gets their bankruptcy discharge. However, you should know that there is a wrinkle for anyone who owes $200,000 or more in income tax debt and if that debt to Canada Revenue Agency (CRA) equals 75% or more of the total unsecured proven claims in the bankruptcy. If that is the case, then that affects the bankrupt’s ability to get a discharge after declaring bankruptcy in Canada.

If it is the person’s first time filing bankruptcy and they do not have to make surplus income payments, then they are still entitled to a discharge after 9 months from the date of bankruptcy. If it is their first time but they do have surplus income payments, then they cannot apply for a discharge until after 21 months.

If this is the person’s second time filing bankruptcy, if they do not have any surplus income payments, then rather than being able to apply for a discharge after 9 months, they must wait 24 months. If they do have surplus income payments, then it is extended to 36 months.

If someone has been bankrupt more than one time before and has at least $200,000 of income tax debt representing 75% or more of the total proven unsecured claims, then regardless of their surplus income payment situation, they must wait 36 months.

Such a bankrupt is called a high tax debtor. A high tax debtor is not entitled to have the Trustee issue an automatic bankruptcy discharge when the time has expired. Rather, there must be a court hearing for the bankrupt’s application for discharge.

CRA will oppose an absolute discharge at least on the basis of the fact that they are a high tax debtor. The Trustee does not have to oppose the discharge on this basis. However, if the bankrupt has failed to live up to any of their duties, including making the required surplus income payment, the Trustee will oppose.

The court will make a conditional order of discharge. At least one of the conditions will be to pay a certain amount to the Trustee for the benefit of the unsecured creditors. The amount depends on the unique circumstances of that bankrupt, but you can assume that the amount will be about 25% of the income tax owing.

So anyone how has income tax debt and is contemplating declaring bankruptcy in Canada, needs to look at their total liabilities carefully. If at all possible, you do not want to be a high tax debtor when declaring bankruptcy in Canada.

***Declaring bankruptcy in Canada*: What debt does bankruptcy not cover?**

Some people think that in a personal bankruptcy filing, the bankruptcy filing itself is what eliminates the person’s debts. That is wrong. At the moment of declaring bankruptcy in Canada, nothing actually happens to your debts. It is the person’s discharge from bankruptcy that “discharges” the person from their debts.

Yet, there is still a category of debts that are not covered and not discharged when a personal bankruptcy discharge occurs. The debts that are not covered or discharged, are outlined in section 178(1) of the BIA. These such debts are:

any type of penalty, fine, restitution order or other order comparable in nature to a penalty, fine or restitution order, enforced by a court in regard of an offence, or any kind of debt developing out of a recognizance or bond;
any damages award by a court in civil process for:

( i) physical injury intentionally caused, or sexual assault, or

( ii) wrongful death resulting therefrom;
any type of financial debt or responsibility for spousal support or alimentary pension;
any kind of financial obligation or liability developing under a judgment establishing an association or about support or maintenance, or under an agreement for maintenance and support of a spouse, former spouse, previous common-law companion or child not living with the bankrupt;
any type of financial obligation or liability occurring out of fraudulence, embezzlement, misappropriation or defalcation while acting in a fiduciary capacity or, in the Province of Quebec, as a trustee or administrator of the property of others;
any financial debt or liability resulting from getting property or services by false pretenses or fraudulent misrepresentation, apart from a debt or responsibility that arises from an equity claim;
liability for the dividend that a creditor would have been qualified to receive on any kind of provable claim not disclosed to the trustee unless the creditor had notification or understanding of the bankruptcy and fell short to take reasonable activity to confirm the claim; or
student loans if the bankruptcy filing happened before the person stopped being a full or part-time student or within seven years after the day on which the bankrupt stopped to be a complete- or part-time student

Declaring bankruptcy in Canada summary

I hope you enjoyed this declaring bankruptcy in Canada Brandon Blog post. If you are concerned because you or your business are dealing with substantial debt challenges and you assume bankruptcy is your only option, call me. It is not your fault that you remain in this way. You have actually been only shown the old ways to try to deal with financial issues. These old ways do not work anymore. The Ira Smith Team utilizes new modern-day ways to get you out of your debt difficulties while avoiding bankruptcy. We can get you the relief you need and so deserve.

The tension put upon you is big. We know your discomfort factors. We will check out your entire situation and design a new approach that is as unique as you and your problems; financial and emotional. We will take the weight off of your shoulders and blow away the dark cloud hanging over you. We will design a debt settlement strategy for you. We know that we can help you now.

We understand that people and businesses facing financial issues need a realistic lifeline. There is no “one solution fits all” method with the Ira Smith Team. Not everyone has to file bankruptcy in Canada. The majority of our clients never do. We help many people and companies stay clear of bankruptcy.

That is why we can establish a new restructuring procedure for paying down debt that will be built just for you. It will be as one-of-a-kind as the economic issues and discomfort you are encountering. If any one of this seems familiar to you and you are serious about getting the solution you need, contact the Ira Smith Trustee & Receiver Inc. group today.

Call us now for a no-cost consultation.

We will get you or your business back up driving to healthy and balanced trouble-free operations and get rid of the discomfort factors in your life, Starting Over, Starting Now.

Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Tags alternatives to bankruptcy, avoid bankruptcy, Bankruptcy and Insolvency Act, commercial proposals, Companies’ Creditors Arrangement Act, consumer proposals, Corporate Bankruptcy, credit counselling, credit counsellor, declaring bankruptcy in canada, filing for bankruptcy, financial counselling, financial difficulty, Ira Smith Trustee, licensed insolvency trustee, Office of the Superintendent of Bankruptcy, personal bankruptcy, undischarged bankrupt

Brandon Blog Post

PAYING DOWN DEBT: MY 7 ESSENTIAL YET EASY HACKS TO BE DEBT FREE

Post author By Brandon Smith
Post date January 6, 2021

The Ira Smith Trustee Team hopes that you and your family had a restful holiday season and that you are all safe, healthy and secure.

Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

If you would prefer to listen to the audio version of this paying down debt Brandon’s Blog, please scroll to the bottom of the page and click play on the podcast

Paying down debt No. 1 financial goal of Canadians for 2021: Poll

A new survey states paying down debt is the #1 economic objective of Canadians to focus on heading right into the brand-new year. Many claimed that they handled more financial and high-interest debt this year to cover day-to-day expenditures and also offset a loss of revenue.

The annual CIBC poll says having a debt repayment plan has actually continued to be the top financial priority for the past 11 years. Unfortunately, what this says is that even without a COVID-19 pandemic, Canadians have been largely unable to do so. Everyone can be excused for 2020. Canadians have been grappling this past year with the financial and health challenges because of the coronavirus.

The purpose of this paying down debt Brandon Blog is to discuss the survey results and provide some tips on how to tackle debt that needs to be paid down. I truly believe that it is not your fault that you have not been able to be successfully paying down debt. You have only been shown the old ways that do not work anymore. Below I describe my 7 easy hacks for paying down debt. It is a new way of getting into the habit. It is a process that you can set up, track and see how you progress.

The survey found the 2nd monetary top priority of Canadians for 2021 after paying down debt is merely keeping up with bills as well as getting by. The survey showed that on average, Canadians expect a positive economic outlook for 2021. The poll results indicate that 24% of Canadians believe their financial position will certainly get better in 2021. This is down from 32% in 2019.

The poll also found the top economic issues facing Canadians in 2021 consist of the rising cost of living, the increased prices of goods and a sluggish economy.

Carissa Lucreziano, vice-president of CIBC Financial and Investment Advice, claims it is reasonable that Canadians are worried given the economic climate of 2020. She states the best buffer is to be prepared with a plan to satisfy your financial objectives, which includes a realistic estimate for paying down debt, that can be readjusted when situations alter.

How Debt Affects Your Credit Scores

The first thing you should know is that debts have a ripple effect across your whole financial life, including your credit history.

Revolving financial obligations includes a line of credit or credit card debt where you can churn, or rotate, a balance from month to month. You can obtain as much credit as you like up to an established credit limit. Interest is charged on any outstanding balance that is not fully repaid by the due date. Your regular monthly payment can differ on revolving debt based on your outstanding fluctuating balance.

Fixed financial debt includes mortgages, auto loans, personal loans and student loans. Most of the time, the amount of money you borrow, rates of interest, the monthly due date and the size of your monthly payment are fixed and known at the start.

With both revolving and fixed financial debts, you must pay promptly. When you miss a payment, your loan provider will report it to one of the two Canadian credit bureaus: Equifax and TransUnion. The credit bureau reporting of late payments can remain on your credit records for 7 years. When you miss a scheduled payment, you not only still owe that amount, but you will also have to pay late or default fees. Now the debt costs you even more!

Besides your payment history, there are other ways each type of financial obligation influences your credit score. With fixed installment debt, having a high outstanding amount does not have a huge effect on your credit score.

Rotating debt is a different story. If you are using a high percentage of your available credit from month to month, it will likely have an adverse result on your credit report and credit score. This is particularly true if you are doing it with numerous credit cards.

Your credit score will be negatively influenced because by using a large percentage of your available revolving credit, your credit utilization score is high. Credit utilization has considerable influence in calculating your credit score. So to keep your revolving debt outstanding as low as possible compared to your authorized credit, ideally, you ought to be paying down debt fully every month.

Why Credit Card Debt Is So Dangerous: My paying down debt calculator

When it comes to financial obligations, credit card debt is usually the most wicked.

Credit card companies can tempt you in with a low initial annual percentage rate (APR) and flashy credit limit. However, that introductory APR deal will ultimately end. When it does, you can find yourself looking at a frustrating heap of financial debt if you really did not handle your new charge card account properly. The reason revolving financial debt can be so frustrating is due to the fact that credit card interest rates are usually very high.

So, if you’re just making the minimum payment each month, it will certainly take you a long time to paying down debt. It could potentially take decades due to the interest accumulation.

Let’s say you put $15,000 on a credit card with a 19.9% APR, and then cut it up. You never get a replacement card and never spend another penny on that account. It is normal for a Canadian credit card to have a minimum monthly payment of 3% of the outstanding balance.

If all you do is make the minimum monthly payment, assuming you maintain the original minimum monthly payment as your balance declines, it will take you 25 years to pay off the full amount. You will also be paying more than double the amount you charged on the card. Here is the math:

Credit card balance	$15,000.00
Credit card APR	19.9%
Minimum payment	3%
Monthly payment	$450.00
Balance payoff	300 months
Total payments	$33,156.26

As you can see, paying down credit card debt this way is very expensive and I have not yet met a person who is comfortable paying down debt over 25 years, other than for perhaps the mortgage on their home.

How Personal Loans Impact Credit Scores

Personal loans also influence your credit score. Whether the loan account one-day damages or improves your score depends on 2 primary aspects: (i) exactly how you take care of the account and what else your credit history shows.

Too many applications could injure your score. That is because when you make an application for credit, an inquiry is logged onto your credit report. Too many such inquiries can damage your rating. The reason is that with more than one application close together in time, the formula assumes that you need the money and at least the inquiries before the last one turned you down.

Your credit might increase as your personal loan ages and there are no negative notations about missed payments. Initially, a new account could lessen your credit score. As your personal loan gets older and remains current, it shows you are using that debt responsibly. That can help your numbers.

A fixed personal loan might reduce your credit usage. Individual loans are fixed installment financings, which do not affect your revolving application ratio in any way. You can have a high balance on a fixed personal loan. If you pay off credit cards with a fixed installment personal loan, then your revolving utilization ratio must reduce. Over time, as long as you don’t get the credit card balances back up there and have the new personal loan outstanding, this can improve your credit score.

Your credit blend could also be enhanced with a personal loan. The credit scoring formula rewards you for having a diverse combination of accounts on your credit report. If you do not have any installment borrowing on your report, getting a fixed installment personal loan may improve your credit score. You just have to make sure that you are making your monthly payments on time for paying down debt. If not, it will damage and not help your score.

7 hacks for paying down debt quickly

Hack 1 – This is my first step to ending up being totally debt-free. This is important prior to anything else. You need to get some quiet time and start to make you’re coming to be debt-free goals real. It is a process that anyone can learn. Making those goals real does not suggest merely thinking them out for 5 seconds. What will you do daily when you are debt-free? What will it feel like? How will your life be changed? How will you feel? Write out this story on a notepad or better still a vision board. After that follow the rest of the steps below to begin to focus on your paying down debt strategy.

Hack 2 – Just how much do you intend to pay off in three months? In six months? You will make use of the steps discussed below to produce these objectives. The recommendation is that you have some shorter-term goals of just how much to save and therefore just how much debt to pay back.

These shorter-term goals need to feed into your longer-term objective. They’re easier to get to than the full objective. They also will certainly inspire you to keep going when you reach them. With your short-term objectives clear, it is time to prepare your month-to-month spending plan. It is a strategy of writing down where your money comes from and where your money is going.

You need to take the time to jot down every source of revenue you have and just how much comes from each one. You likewise need to identify and also write down where the money is going – line by line. As soon as you have done that, you can figure out where you can really decide if you can do any other activities to bring in more and what spending you can cut out. This will get you onto a savings plan, which will then give you the extra money to let you begin paying down debt.

I know I may have just lost fifty percent of you. This isn’t a budgeting blog site in itself. You have to create your budget plan on your own. I have written other blogs on the subject of budgeting which you can read here.

Hack 3 – I like fast small flares for saving cash. It will also reveal a great deal concerning the way you spend money. Start cutting back on things from your budget plan you have control over. Things like clothing purchases, eating out at restaurants (pre-pandemic) and other entertainment. I would hazard a guess that since the lockdowns and self-quarantining began last March, you have spent less on these types of spending than the year before. Go track it from your credit card statements, I bet you will see that is the case.

You can test on your own how to lower that spending in half or eliminate it out completely over the next 2 months. I am not discussing going cold turkey and not spending anything. I am speaking about a short-term challenge of a couple of months and on 1 or 2 spending things at a time.

These spending challenges work on so many levels. I am sure you will love them just like me. By only taking one or two items off of your spending, you are not attempting to save every dime.

You can still spend. You are simply trying out cutting down on a couple of things each time. Besides saving a lot of cash, this is going to reveal to you what you do not really care about in the spending side of your budget. You will now easily have gotten into the habit of not spending money on those things. You will now have savings in the form of extra money that you can use for meeting your paying down debt goals.

What is also great is that 8 weeks is right around the time it takes to construct brand-new behaviour patterns and breaks old habits. Those brand-new practices are most likely to drive you and help you feel that saving is not as difficult as you originally thought it would be. Maintaining these brand-new spending and saving behaviours is just one of the tricks for paying down debt.

How to get out of debt on a low income

Hack 4 – Next is doing a complete decluttering. Don’t worry, I assure you it’s a lot easier than it seems. You just have to get started. Go room-to-room in your residence and itemize every little thing you do not need. Specifically, those things you have not used in a long time. Set a rule such as have I used this, worn it or looked at it in the last 5 years? If the answer is no, out it goes. Do not second guess yourself. Stick to the rule.

This could include the treadmill you might have used only in the first 3 months after you got it, the out-of-date clothes that you never wear or the furniture you never ever rest on. Anything that isn’t being made use of or making your life better, offer it for sale online.

Not only are you making a little cash to help with your paying down debt. You are ridding yourself of something you do not need and someone who will enjoy it as much as you used to.

You may find that with some of the items, you could have squandered your money getting some of these things. But that was in the past. We are now only looking forward. It will also be a good memory to have the next time you think you need to buy something. I am sure you will analyze all future buying decisions differently.

Hack 5 – This is going to be another hard decision. However, it is one that a lot of people just have to do if they are serious about paying down debt. That is taking a sober look at how you travel every day.

I like seeing or paying attention to people talking about how much financial debt they have. What always astonishes me is the number of people who have a reasonable brand-new vehicle with monthly payments they do not have the money or budget to support. Seriously, people simply do not seem to see exactly how a high regular monthly auto payment is trashing their spending plan!

Besides the payment itself, insurance, licensing and maintenance costs come with the vehicle. I am not saying you cannot have nice things or that you need to never ever get a brand-new car or truck. Perhaps a clean vehicle in good condition that just came off a 3-year lease would be extra affordable and save you cash.

Appreciate your money! We do not have a great deal of time on this earth and you have to enjoy it. However, you can’t appreciate life if you’re constantly stressed out from your debt. So have a close look at what is parked in the driveway and be honest with yourself. Can really afford it?

By following this logic you will have extra cash each month that you can allocate to paying down debt.

Hack 6 – This tip most likely will eliminate lifestyle creep. Lifestyle creep is how your spending appears to increase every time your revenue does. The result is you are always stuck in paycheque-to-paycheque mode and are never paying down debt.

Just how is it that we get tax refunds or a raise, we never have enough that amount saved? You work overtime but the cash just appears to vaporize into thin air. It is the problem of lifestyle creep. Our spending plan always seems to grow to eat up whatever income there is.

Fighting lifestyle creep suggests referring back and monitoring your budget on a regular basis. Plug in that refund or additional income on an after-tax basis. Remind yourself how much you are spending. This will let you take that initiative to not spend even more if you now have a little extra. The very best thing to do is to designate that additional money for paying down debt and then to do it right away.

By having a place for that money, it stops being a temptation to spend it. It may not seem like it will conserve much however you would be surprised just how quickly normal smaller amounts will build up over time.

Hack 7 – My last money-saving method is going to put a freeze on your credit cards. Make the essential payments you have budgeted for by using cash. You simply do not obtain that very same psychological and emotional sensation when you use a credit card that you obtain when you pay with cash. When you pay with cash, you feel the purchase. Not so much with a credit card.

I’m not saying to cut up your cards. I have a credit card I use for company spending purposes and another for personal use. It is also handy to have one for emergencies if you do not have an extra money reserve yet from your savings. Stopping the use of your bank card will still keep that alternative open yet it makes you reassess your spending on practically every product.

Simply put, these 7 money-saving hacks will give you thousands of dollars over time. You can use that money first for paying down debt. Once your debts are paid off, keep up those same habits to build up savings for investment and ultimately your retirement. Each hack is simple yet effective. You will love to see how quickly you can make progress in paying down debt. Each one is not a major step, but combined together, they will have a profound effect on your debt payment plan.

***Paying down debt*: Do you want an avalanche of snowballs?**

The 7 simple hacks I describe above gets you the cash to use to pay down your debt. Now you actually have to do it. I am sure that you have heard of the two highly touted methods of actually paying down debt being the: (i) debt avalanche method; and (ii) debt snowball method. Dave Ramsey, a US financial commentator, is a strong proponent of these methods.

Here is a summary of the two methods for paying down debt. In the debt avalanche method, you pay off your debt with the greatest rate of interest initially, 2nd greatest next and so forth. In the debt snowball method, you pay off the single debt in total with the smallest outstanding balance first, second smallest 2nd and so forth.

The debt avalanche approach of paying down debt approaches the matter from a financial perspective. The snowball method is more psychological. Both get you to reduce your debt. Both help you reach your financial goal.

If you would like more details on both the debt avalanche and snowball payment plan methods of paying down debt, read my March 2019 blog – Debt Help Near Me: Our Toronto Debt Repayment Calculator Strategy.

Can I book a meeting with someone who can help?

Of course, you can. Contact the Ira Smith Team for your no-cost consultation. We can start helping you immediately getting into a pattern of paying down debt.

I hope you enjoyed this paying down debt Brandon Blog post. If you are concerned because you or your business are dealing with substantial debt challenges and you assume bankruptcy is your only option, call me. It is not your fault that you remain in this way. You have actually been only shown the old ways to try to deal with financial issues. These old ways do not work anymore. The Ira Smith Team utilizes new modern-day ways to get you out of your debt difficulties while avoiding bankruptcy. We can get you the relief you need and so deserve.

Call us now for a no-cost consultation.

We will get you or your business back up driving to healthy and balanced trouble-free operations and get rid of the discomfort factors in your life, Starting Over, Starting Now.

The Ira Smith Trustee Team hopes that you and your family had a restful holiday season and that you are all safe, healthy and secure.

Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Tags annual CIBC poll, avalanche method, credit card, credit card balances, credit card debt, credit history, credit score, debt repayment plan, Equifax Canada, Ira Smith Trustee, Line of Credit, paying down debt, paying down debt calculator, personal loan, revolving debt, revolving utilization ratio, snowball method, transunion canada

Brandon Blog Post

CPP PREMIUMS: A SIMPLE (BUT COMPLETE) GUIDE TO 2021 HOW INCREASED CPP PREMIUMS ARE HITTING WORKERS

Post author By Brandon Smith
Post date January 4, 2021

The Ira Smith Trustee Team hopes that you and your family had a restful holiday season and that you are all safe, healthy and secure.

Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

If you would prefer to listen to an audio version of this CPP premiums Brandon Blog, please scroll to the bottom and click on the podcast.

CPP premiums introduction

Everyone who is an employee or is self-employed must make Canada Pension Plan (CPP) payments. The payments you make are your CPP premiums. Employers also must contribute to the CPP. If you are self-employed, then the CPP premiums you must pay each year are calculated as part of your annual income tax return filing.

In this blog, I discuss how the Canadian Government has already given a nasty surprise to Canadians for 2021. The planned increase in CPP premiums on January 1 hit some workers for their 2021 CPP contributions more than others because of the coronavirus pandemic.

The Canada Pension Plan and CPP premiums

The Canada Pension Plan (CPP) is a government-run pension plan for retired Canadians. It provides a monthly taxed retirement pension benefit that replaces part of your income when you retire. Under the CPP, you obtain the CPP retirement pension plan payments for the rest of your life. To qualify you must:

be least 60 years old;
have actually made a contribution to the CPP;

Valid contributions can be either from work you carried out in Canada or as the outcome of getting credits from a former spouse or former common-law spouse at the end of the relationship.

CPP premiums and annual maximum pensionable earnings bump-up

For this 2021 year, the earnings ceiling, called the yearly maximum pensionable earnings (YMPE), was supposed to be $60,200, an increase of $1,500 from the 2020 limit. However, the actual amount is higher at $61,600. The maximum annual employee and employer contribution amount is $3,166.45 (up from $2,898.00 in 2020). The maximum annual self-employed contribution level is now $6,332.90 (up from $5,796.00 in 2020).

Provincial finance ministers quietly prodded Finance Minister Chrystia Freeland to put a pause on planned increases in premiums workers and businesses pay into the CPP. So did various business groups. They did not feel it was appropriate this year to have the contribution rate go up. Notwithstanding the support of business groups and each province, it was to no avail.

The originally planned increase on January 1 belongs to a multi-year plan accepted by each province and the Canadian government four years ago. They agreed to improve retired life benefits through the CPP by boosting contributions over time slowly.

The very first bump was in 2019. The province finance ministers asked Finance Minister Freeland to put a pause on this year’s automatic increase. They cited the damage done to workers and businesses as a result of the COVID-19 pandemic. They said it isn’t a smart financial decision to take more off workers’ paycheques and also to charge businesses a lot more when so many continue to have a hard time.

Moratorium on CPP premiums increase requested by provinces and business groups

So many provincial finance ministers on a call with Finance Minister Freeland, and various business groups independently, asked her to put a pause on this year’s planned increase in CPP premiums and the contribution rate because of the COVID-19 pandemic.

The pandemic’s effect on the labour market, which has some groups noting the impact will be felt by some workers more than others. The plan requires contributions to go up alongside the upper limit on earnings that are subject to those premiums. As I have already stated, the YMPE was supposed to be $60,200. This would have meant tax increases of $1,500 from the 2020 limit. But the actual amount is going to be higher at $61,600.

The reason is due to the pandemic’s impact on the labour market and how the YMPE is calculated. Here are the details. The formula to calculate the earnings limit relies on rises in the average weekly earnings for the 12 months finishing June 30, contrasted to the same amount during the preceding 12-month time period. Over the time of the pandemic, average weekly earnings have increased, but not because workers are making more.

Dan Kelly, president of the Canadian Federation of Independent Business said:

“That’s going to be hundreds of dollars of new CPP premiums out of paycheques of middle-income Canadians not because they got a raise, but because the formula has not had a COVID adjustment,” Kelly says. Nevertheless, the government will collect more money than it originally planned through CPP premiums.

Any type of modifications to contribution rates or the YMPE would require the authorization of Parliament as well as seven provinces representing a minimum of two-thirds of the nationwide population. This is a greater bar than what is required to modify the Constitution!

The federal government response for a moratorium on the CPP premiums increase

Ottawa’s answer was not only to have them go up again but do so more than the scheduled increase. Why? The reason is specifically the calculation in the formula that the Feds and provinces signed up for, well before anyone bothered to know how to spell Wuhan!

Here at the details. The labour market got skewed (no, I did not make a spelling mistake) as job losses have hit the lower-income employees more since March 2020. Therefore, if you reduce the earnings at the lower end of the calculation range, you are left with higher wages, on average, when you do the calculation.

The Canadian government claims that is why the general increase is larger than originally scheduled. Dan Kelly calculates that anybody around the maximum limit will see a 9.3 percent rise in CPP premiums, beyond the approximately five-per-cent premium bump baked into the legislation.

A spokeswoman for Ms. Freeland stated stopping the increases agreed to in 2016 would imply reducing future retirement benefits for Canada’s current workers. The spokeswoman went on to say that the government’s leading concern is supporting Canadians, businesses and business owners who are experiencing economic difficulties as the nation weathers the COVID-19 pandemic. With a 2nd wave underway, lots of people across Canada continue to deal with tremendous unpredictability.

I am not sure what current unpredictability from COVID-19 has to do with freezing CPP premiums for each person and business from an increase for 1 or 2 years has to do with the issue, especially since the effect of freezing the increases will not be affected for decades to come, if at all. Nevertheless, that is what was said.

CPP premiums summary

I hope you enjoyed this CPP premiums Brandon Blog post. If you are concerned because you or your business are dealing with substantial debt challenges and you assume bankruptcy is your only option, call me. It is not your fault that you remain in this way. You have actually been only shown the old ways to try to deal with financial issues. These old ways do not work anymore. The Ira Smith Team utilizes new modern-day ways to get you out of your debt difficulties while avoiding bankruptcy. We can get you the relief you need and so deserve.

That is why we can establish a new restructuring procedure just for you. It will be as one-of-a-kind as the economic issues and discomfort you are encountering. If any one of this seems familiar to you and you are serious about getting the solution you need, contact the Ira Smith Trustee & Receiver Inc. group today.

Call us now for a no-cost consultation.

We will get you or your business back up driving to healthy and balanced trouble-free operations and get rid of the discomfort factors in your life, Starting Over, Starting Now.

The Ira Smith Trustee Team hopes that you and your family had a restful holiday season and that you are all safe, healthy and secure.

Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Tags Canadian Federation of Independent Business, contribution rate, coronavirus, covid-19 pandemic, CPP, CPP contributions, CPP premiums, Finance Minister Chrystia Freeland, Ira Smith Trustee, lower-income employees, maximum annual employee and employer contribution, planned increase, Provincial finance ministers, retirement benefits, retirement pension benefit, self-employed contribution, yearly maximum pensionable earnings, YMPE

Brandon Blog Post

BRANDON BLOG POSTS 2020 REVIEW: TOP 10 KEYWORDS LEADING MANY TO PROVEN DEBT SETTLEMENT

Post author By Brandon Smith
Post date December 30, 2020

The Ira Smith Trustee Team wishes you a happy, healthy and secure 2021 New Year.

Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Brandon’s Blog posts introduction

What a year 2020 has been. I am sure that we are all glad that it is almost over. I always like to end the Brandon Blog posts calendar year by looking back to see which of my blog posts were the most read by people. As you will see, not all were necessarily written in 2020. This is also not a list of the best blog posts as I don’t rate mine that way. I let my beloved readers do that by looking at what they read. Also, I send an annual survey to my subscribers to make sure that what I write about covers off what they have told me they are interested in reading about.

In Brandon’s Blog, I talk a bit about my philosophy in how I write blog posts and then go on to describe the 2020 picks.

What are blog posts?

Blog posts permit me and my company to describe my views, ideas, and stories online concerning the world of Canadian insolvency and debt matters. They can, and I hope they do, aid you in your understanding of the subject matter I write about. I love providing value to my readers in this way.

I also hope that it drives traffic to my website, increases people’s recognition of the Ira Smith Trustee & Receiver Inc. brand, imparts the feeling of trustworthiness in our brand and ultimately phone calls and new work for my Firm. This is what is called content marketing.

You can find multiple blogs for any industry, business, hobby or topic.

What makes good blog posts?

Before putting “pen to paper“, I put myself in the shoes of the blog readers. I try to make certain I understand why someone would want to keep reading my blog posts and why would they return to read more. Since I write and post two blogs per week, I am conscious of the fact that I don’t want to have my Brandon Blog posts cause visitors to my blog posts and my loyal readers “blog fatigue”.

In addition to what I hope you find to be easy reading, I also incorporate the use of audio and video. Every Tuesday’s blog has an audio version at the bottom to listen to. Every Thursday blog has a video that you can watch also. In that way, if you don’t feel like reading that day, you can listen or watch and listen. I hope that readers find that helpful. At least nobody has complained yet!

I also believe that my blogs need to respond to the questions people are actually searching online for an answer to. You will see that when I describe the 2020 Brandon Blog posts in the review below.

I also believe that it is not very helpful to readers if all I do is give a technically correct answer to someone’s question. I really believe that I also have to offer realistic, easy to implement solutions to a problem someone is asking about while keeping the blog post interesting.

I believe that excellent blog posts are interesting to the reader, offer educational yet practical content for my audience and hopefully show off good writing skills.

How do I write my Brandon blog posts?

I try to stick to a formula in writing blog posts. It is not the case that each blog reads the same. Rather, it is the process I use to come up with the blog topic and then write is streamlined. I have to be efficient because my real job is being a licensed insolvency trustee helping individuals, entrepreneurs and their companies solve their debt problems is really my full-time job.

Writing two blog posts a week would be impossible if I didn’t have a system that allowed me to be the most efficient possible. So here are the steps I use to pick and write my Brandon Blog posts:

I plan my blog post by picking looking for topic ideas. To do this, I look at what is happening in the news, the insolvency industry, I review recent court decisions and look at other resources. Maybe most important, I look at Google search analytics to see what kinds of insolvency questions are people looking online to get answered. Then I settle on my topic from the various blog post ideas that I have come up with.
Once I select the topic from the various ideas, I then select the long-tail keyword and other keywords that seem to be popular around it. I then draft a summary of what details I think the blog content should have.
Then I draft the content based on the summary and my independent research. I review it and make whatever changes are necessary.
Then I create the blog post title that I hope will not only be informative but will also capture readers’ attention. I certainly do not want any vague headlines. Normally, writing introductions and blog post titles are the last things I do, once I am happy with the content.
I then select images. The visual assets are very important too. I also make audio podcasts and videos to improve the content of my blog posts. I hope that in this way, I can show some wit and humour and give readers an alternative to hold their interest besides reading. We all have to read a lot of things, so if my audio or video lets you rest your eyeballs while still getting the information and details, that is a good thing.
Regular readers will notice that my videos have become more sophisticated over the past few years. I have gone from just images and audio off-camera videos to on-camera videos complete with subtitles. As part of being efficient, I don’t have the time to be on camera. Thankfully Ira Smith is not camera shy and helps me out in this way.
I then look at the finished blog post’s structure and formatting to make sure that things like post headlines and the post content are quality content. I also have to make sure that everything can be found by Google, Bing, YouTube and other search engines by making sure that the search engine optimization has been done properly. The meta description for the Brandon blog posts is also very important to be done correctly. It won’t be any good if nobody can find my blog content!

I stick to these steps every time. I want to end up creating an awesome blog for my visitors and subscribers. In the very beginning, blogging was tough work. Today, I do this by second nature, so, now, they are for me simple steps.

Some searches follow a theme. I have grouped similar search terms together. These are in addition to the ones you would normally expect like a consumer proposal, personal bankruptcy, corporate bankruptcy and restructuring and turnarounds. In the section below this one, I detail which Brandon Blog posts people find when they use these search terms.

So without further ado, from Google Analytics, here are the top 10 things people searched for that led new visitors to my Brandon blog posts:

40 park lane circle, 40 park lane circle toronto, 44 park lane circle, 40 park lane circle owner, 40 park lane circle owner, who owns 40 park lane circle – These two properties in Toronto’s Bridle Path area apparently still garner a great deal of interest.
what happens to mortgage when you die canada, joint mortgage death of spouse canada – Many people are concerned about what happens to debt when you die in Canada – From the work that we do as an Estate Trustee, I fully understand why. As a licensed insolvency trustee, I have also administered many times the bankruptcy of an insolvent deceased Estate.
how to negotiate with 407 – Many times in consumer insolvency files, people owe a large debt to 407 ETR. Please excuse the pun, but where the “rubber meets the road”, is when the person is refused renewal of the vehicle license permit because of this outstanding debt. That is normally the time when people want to find out about how they can negotiate with 407 ETR. More often than not, the only way to settle or purge this debt is through either a consumer proposal or a bankruptcy.
form 31 proof of claim, how to complete form 31 proof of claim canada, proof of claim form example canada, how to fill out a proof of claim form canada – In order to participate in an insolvency proceeding and be entitled to be paid a dividend should it be declared, is by filing a proof of claim. The form can be confusing for 1st time proof of claim filers and especially for people not used to dealing in insolvency matters. Many times these people need help in completing a form 31 proof of claim.
i need financial help immediately canada – Although people search this long-tail keyword every year, this year the volume of searches has risen dramatically. It is no wonder that since March 2020 the coronavirus pandemic has caused this keyword to be searched for more than usual in any prior year.
4 pillars class action – This keyword search term refers to a class-action lawsuit in British Columbia
Pearce v. 4 Pillars Consulting Group Inc., 2019 BCSC 1851.
is spouse responsible for credit card debt in canada – This is related to the debt and death keyword search term above regarding mortgages and death.
commercial tenancies act – In Ontario, the Commercial Tenancies Act, R.S.O. 1990, c. L.7 sets out the provincial law for commercial tenancies. This is another keyword search term that has increased in 2020 due to COVID-19.
if your parents die with debt who pays it canada – Suffice to say, more debt and death.
goldie cranston – This one surprised me. Goldie Cranston is the sister of the late Canadian figure skating champion, Toller James Montague Cranston, who died intestate in 2015.

Here are the Brandon blog posts that the top 10 insolvency-related (but not including the obvious ones I listed above) Google searches and other search engines produced in 2020 led people to:

The 40 Park Lane Circle search terms leads people to our December 3, 2013 blog titled “Park Lane Circle – People Who Live In Glass Houses Can’t Change The Rules” and our March 31, 2015 blog titled “40 Park Lane Circle, 44 Park Lane Circle Toronto For Sale: Are Financial Problems Contagious?“. The first one deals with the receivership sale of this Toronto mansion. The second blog is about the financial problems of the owner of number 40, Mahvash Lechcier-Kimel and the owners of 44, Norma and Ronauld Walton.
The death and mortgage search terms leads you to our October 9, 2019 blog titled “What Happens To Mortgage When You Die Canada: Debt Philosophy Explained“. In this blog, I talk about what happens to the mortgage debt, the mortgage and the related real estate when the death of an owner happens.
Searching how to negotiate with 407 brings up my November 19, 2015 blog “407 ETR Debt Settlement: Our Newest Guilt Free Way To Do It“. In this Brandon Blog, I describe an Ontario court case and show how an insolvency process can eliminate the 407 ETR debt.
The”how to complete form 31 proof of claim canada” and related search terms turns up my October 3, 2018 blog titled “Form 31 Proof of Claim: How To Complete A Proof of Claim“. In this blog, I describe the importance of completing and submitting a proof of claim and provide a real step-by-step example of how to complete it. There is a link in the blog to the example, which is stored on a different server. That example is being clicked on daily since it was uploaded.
The immediate financial help search term leads the person to my September 6, 2017 blog post “I Need Financial Help Right Now: What You Need To Do When You Need Financial Help Immediately And Say A Prayer For Immediate Financial Help While You Are At It“. I recently wrote an update on this theme for COVID-19 Canadian Government support programs in my blog titled “The I Need Financial Help Immediately Canada Plan To Become Financially Strong.“
The 4 Pillars search produces my November 25, 2019 blog “How Does Debt Relief Work: Apparently Not Great 4 Everyone“. You can read it to find out all about the class-action lawsuit Pearce v. 4 Pillars Consulting Group Inc.
The deceased spouse and credit card debt search will lead you to several of my blog posts :

August 7, 2019 – Credit Card Debt After Death In Canada: Who Is Responsible?

October 23, 2019 – Legal Effects When Only One Spouse Files For Bankruptcy In 2019 And Beyond

March 4, 2020 – Do You Inherit Debt In Canada: CRA Says Yes To Property Transfers

August 12, 2020 – What Happens If You Die Without A Will In Ontario? Read Our Intense Analysis

Hopefully, the titles of these blog posts are self-explanatory. I invite you to read any that may pique your interest.

The commercial tenancies search will produce my coronavirus related June 22, 2020 blog “Commercial Tenancies Act Ontario: New Fix For Your Unruly Landlord’s COVID-19 Commercial Lease Termination“. In that blog, I describe how Ontario Bill 192 amending the Commercial Tenancies Act works. As with everything, the devil is in the details.
Your parents die with debt long-tail keyword search produces my June 25, 2018 blog “What Happens To Debt When You Die Canada: Are You Free Of Debt“, in addition to several related ones already described above.
Last but not least, those who search the name “Goldie Cranston” will find my blog “Dying Without A Will In Ontario: Distribution To Heirs Not Easy“. In that Brandon’s Blog, I discuss the issues around dying without a will and the fight between the siblings of the late Canadian figure skater, Toller Cranston.

Blog posts summary

I hope you enjoyed this Brandon Blog posts review of 2020. I started with the most searched terms that led visitors to my blog posts but not including the obvious ones relating to insolvency assignments. Like with any blog post, if you feel it provides value, please feel free to share any of my Brandon Blog posts to your social network.

Hopefully, you find that I provide enough information that makes them actionable blog posts, i.e. I provide a solution that you feel comfortable that you can put into action right away for yourself. Or perhaps, it motivates you to call me and ask some follow up questions. Each one may not give you a step-by-step guide, but they should give you enough information to start taking positive action to improve your financial situation.

If you are worried because you or your company are facing significant financial challenges and you think bankruptcy is your only option, call me. It is not your fault that you are in this situation. You have been only shown the old ways that do not work anymore. The Ira Smith Team uses new modern ways to get you out of your debt troubles while avoiding bankruptcy. We can get you debt relief freedom.

The stress placed upon you is huge. We understand your pain points. We look at your entire situation and devise a strategy that is as unique as you and your problems; financial and emotional. The way we take the load off of your shoulders and devise a debt settlement plan, we know that we can help you.

We know that people facing financial problems need realistic lifeline. There is no “one solution fits all” approach with the Ira Smith Team. Not everyone has to file bankruptcy in Canada. Most of our clients never do. We help many people and companies avoid bankruptcy.

That is why we can develop a restructuring process as unique as the financial problems and pain you are facing. If any of this sounds familiar to you and you are serious about finding a solution, contact the Ira Smith Trustee & Receiver Inc. team today.

Call us now for a free consultation.

We will get you or your company back on the road to healthy stress-free operations and recover from the pain points in your life, Starting Over, Starting Now.

The Ira Smith Trustee Team wishes you a happy, healthy and secure 2021 New Year.

Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Tags Bankruptcy, blog, blog post title, blog posts, blogs, Consumer Proposal, content, content marketing, debt problems, Ira Smith Trustee, licensed insolvency trustee, loyal readers, pen to paper, visual assets, What are blog posts, What makes good blog posts, writing blog posts, writing introductions, writing skills

Brandon Blog Post

MORTGAGE WITH BAD CREDIT: MY BEST TIPS ON HOW TO GET THE MORTGAGE YOU NEED

Post author By Brandon Smith
Post date December 28, 2020

We hope that you and your family are safe and healthy.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

If you would prefer to listen to the audio version of this mortgage with bad credit Brandon’s Blog, please scroll to the very bottom and click play on the podcast.

A mortgage with bad credit introduction

Looking back on the 2020 year, the coronavirus pandemic has caused so much health and financial devastation to Canadians. Canadians’ either losing their jobs or at least their income has been the main cause of personal financial problems this past year.

To their credit, the Federal Government quickly came to the aid of people and businesses by rolling out Canada’s COVID-19 Economic Response Plan. The many programs to lend financial support implemented by the Federal Government have been largely successful, notwithstanding not all the programs worked well. Luckily, the major ones did work well in getting much needed financial support to Canadians and Canadian businesses.

In fact, the government support has worked so well that insolvency statistics in Canada as of October 31, 2020, show that consumer and business insolvency proceedings are down in 2020 by almost 25% compared to 2019. So at a time when there is so much financial hurt in Canada, formal insolvency proceedings are way down. I attribute Canada’s COVID-19 Economic Response Plan as the main reason why.

But that does not mean that financial problems in Canada are over. I suspect that as certain government support programs have now ended, and the remaining ones are right now scheduled to end in 2021, it is the coming year where the insolvency statistics may take a turn for the worse with the number of insolvency proceedings increasing.

One of the support programs that have ended is the mortgage deferral program. The purpose of this Brandon’s Blog is to look at what are the options for people who need to either get or renew their mortgage with bad credit.

Mortgages and the coronavirus

As I previously wrote about, there were two phenomenons in 2020 with mortgages in Canada. First, there were roughly $170 billion in home mortgage deferrals among Canada’s 6 major banks. The bulk of them was set to expire by September 30.

The second was that there was a significant rise in Canadian consumer debt primarily from an increase in both mortgage loans and vehicle financings. The major banks reported that increases in mortgage debt came from both the refinancing of existing home mortgage debt as well as new home mortgage applications.

We also know from media reporting, that at least in the Greater Toronto Ontario Area, the residential real estate market remained hot. COVID-19 could not slow it down. We also know that Canadians have taken advantage of the extremely low home mortgage interest rates to increase their mortgage debt in order to pay down or off much higher-rate consumer debt.

For those with a good credit rating, getting new or refinanced mortgage loans has not been a problem. But what about those needing a mortgage with bad credit?

How your credit score impacts your mortgage rate

To comprehend just how poor credit scores impact home mortgage rates, it helps to look at it as a mortgage lending institution. Giving a loan to someone with a poor credit history is high-risk, as they are more likely to not make their monthly payments on time or they might default completely. To make up for the additional danger, lenders approve this kind of home mortgage with bad credit using higher interest rates than the posted rates.

In Canada, credit scores range from a low of 300 to a high of 900. You are rated by Canada’s 2 significant credit bureaus; Equifax and TransUnion. This number is used to tell lenders just how you have dealt with available credit in the past. The greater your credit score the far better, due to the fact that it assists you to get approved for the lowest possible interest rates.

A person with a minimum credit score of 630, should not have a problem getting a standard mortgage approval from one of the major bank mortgage lenders. Obviously, the higher your credit score above 630, the better.

If your credit score is below 630, a lot of the financial institutions in Canada will not authorize you for a mortgage loan. Rather, you may need to utilize a “B lender institution” or even a private lender to get that mortgage with bad credit. Lenders such as these have bad credit mortgages available for people with a poor credit history.

What kind of bad credit mortgages are available?

A person applying for a bad credit mortgage may have to save for a larger down payment (frequently 20% or more), or more equity in your house than a person with a good credit score if you are applying for a mortgage refinancing. If you are lucky enough to have a co-signer, that is also a good thing.

Sometimes, if the debt problems are small, the best or close to the best mortgage rate could still be readily available to you. You would be well advised to hire a knowledgeable mortgage broker. A mortgage broker’s fee is paid for by the lender, not the buyer or homeowner. They will certainly attempt to get you the best rate based on your current economic situation. Using an experienced broker is essential if you are looking for a mortgage with bad credit.

A mortgage professional has access to many different types of lenders. Most insurance companies have a portfolio of residential mortgages as part of their overall financial investments. Mortgage brokers also know of private lenders. Even if a lender at one of the major banks turns you down, a mortgage broker may very well be able to find you a lender who will say yes. The mortgage rate might be higher than those posted in the newspaper or shown online, but at least you will get the mortgage with bad credit loan that you need.

What are the advantages of bad credit mortgage loans?

Commonly bad credit borrowers with credit report problems, a bad credit score range and overall credit issues are rightfully reluctant to handle more debt. However, a mortgage with bad credit is very different than taking on more debt just for consumer overspending. When you need a mortgage, it is because you want to buy an asset that is worth more than the amount of money you will owe on it.

So, a mortgage with bad credit can be a powerful device to enhance credit score ratings. A few of the methods bad credit borrowers who can qualify for a home mortgage accomplish this are:

Consolidate multiple high rate consumer debts, such as credit card debt or unsecured line of credit debt, into a solitary lower interest mortgage loan. Eliminating high rate debt that is in default through debt consolidation with a lower rate mortgage AND making your monthly payments on time, will improve your credit score.
Amortize financial debt over a longer period to lower your monthly payments. This will certainly help your cash flow.

Even a mortgage with bad credit will certainly have lower rates than credit cards and unsecured lines of credit. This conserves money because the lower interest rate loan will have a lower monthly payment than the total of the monthly payments of the higher rate loans.

In short, a mortgage product for bad credit scores helps you improve your credit score over time, especially if you use the new or refinanced mortgage with bad credit loans to retire your credit card balances.

Here is another tip. Once you retire your old unsecured credit card balances, cancel them. Then, get a secured credit card. Just like the mortgage with bad credit product, every time you pay off your secured credit card on time, the card issuer reports that to the credit bureaus. This too will help repair your damaged credit and improve it over time.

What if I can’t get approved for a mortgage with bad credit loan at an A or B lender?

If you have worked to build your credit and are still incapable to obtain approval on a conventional mortgage, be sure to ask your broker what else you should do differently. More than likely, the broker will recommend canvassing their private mortgage lender contacts. Private lenders are willing to do mortgages for people.

Borrowing from a private lender for a mortgage with bad credit will carry additional fees and a very high-interest rate. Most private mortgages also carry a very heavy penalty for defaulting or even just late payments. However, if your budget tells you that you can afford the monthly mortgage payment, a private lender has much more flexibility.

A private lender is much more willing to look at your stable employment record and your proof of income, rather than just your credit report. Of course, an appraisal supporting the value of the home and the loan requested is crucial.

Keep in mind that a private lender may very well be more lenient if you had previously filed a consumer proposal or for bankruptcy. Whereas an A lender and many other lenders will be scared off by this, a private lender may very well not be. If you have successfully completed your consumer proposal or have received your bankruptcy discharge then you have shed the debt that weighed you down. So it is very possible that you have a relatively small debt load.

Alternatively, if you are refinancing for debt consolidation purposes, the private lender will want proof that the debts have been paid off with the portion required from their mortgage with bad credit advance. As long as the alternate lender is happy with your income and employment history along with the appraisal, the lender won’t be bothered by the debts that will no longer be outstanding.

So although the private mortgage route is expensive, at least the money you need is available. Let’s face it, if you had a good credit score, you would deal with one of the chartered banks, even for insured mortgages. You would not need someone who can provide you with a mortgage with bad credit product.

Mortgage with bad credit summary

I hope you have enjoyed this mortgage with bad credit Brandon’s Blog. Do you or your company have too much debt? Are you or your company in need of financial restructuring? The financial restructuring process is complex. The Ira Smith Team understands how to do a complex restructuring. However, more importantly, we understand the needs of the entrepreneur or the person who has too much personal debt.

You are worried because you are facing significant financial challenges and you think the only thing you can do is file bankruptcy in Canada. It is not your fault that you are in this situation. You have been only shown the old ways that do not work anymore. The Ira Smith Team uses new modern ways to get you out of your debt troubles while avoiding bankruptcy. We can get you debt relief freedom.

We know that people facing financial problems need realistic lifeline. There is no “one solution fits all” approach with the Ira Smith Team. Not everyone has to file bankruptcy in Canada. We help many people and companies avoid bankruptcy.

Call us now for a free consultation.

We will get you or your company back on the road to healthy stress-free operations and recover from the pain points in your life, Starting Over, Starting Now.

We hope that you and your family are safe and healthy.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Tags bad credit borrowers, bad credit mortgages, bad credit score range, B lender, Canada's COVID-19 Economic Response Plan, credit report problems, credit score, Equifax, how your credit score impacts your mortgage rate, insolvency statistics in Canada, mortgage debt, mortgage deferrals, mortgage with bad credit, poor credit history, private mortgage lender, TransUnion, what are the advantages of bad credit mortgage loans, what if I can't get approved for a mortgage with bad credit loan at an A or B lender, What kind of bad credit mortgages are available

Brandon Blog Post

THE I NEED FINANCIAL HELP IMMEDIATELY CANADA PLAN TO BECOME FINANCIALLY STRONG

Post author By Brandon Smith
Post date December 23, 2020

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

We hope that you and your family are safe and healthy. For those that celebrate it, we wish you all a very Merry Christmas. To everyone, we wish you a healthy, happy and secure 2021.

I need financial help immediately Canada introduction

“I need financial help immediately Canada” is something we have heard daily as a result of the COVID-19 pandemic. Many have either lost their jobs entirely or have had their hours cut back dramatically. Canadians have been battling to make ends meet daily. It is therefore not a shock that individuals have been looking for financial assistance from the Federal Government throughout and other methods just to say afloat.

Sadly yet at the same time thankfully, the Government of Canada and the Provinces, including where I live, Ontario, acted quickly to provide some emergency financial relief. This Christmas holiday season will be very different for so many individuals in Canada and internationally.

The purpose of this I need financial help immediately Canada Brandon’s Blog is to look at where we have come from so far from the onset of COVID 19 so far in Canada and what financial assistance programs remain for individuals in Canada in the weeks and months ahead for 2021.

***I need financial help immediately Canada*: A review of 2020 emergency benefits for individuals**

Canada Emergency Response Benefit (CERB)

The main program for individuals saying “I need financial help immediately Canada” was the CERB, which is now closed. CERB payments cannot be released after December 31, 2020. The application window for retroactive CERB applications closed on December 2. Applications need to be authorized by today in order for the funds to be paid out in time.

This coronavirus induced support program has helped millions of individuals with income support payments in 2020. The most recent published Federal Government statistics are only as of October 4, 2020. That information published by the Government of Canda indicates that:

27.57 million applications were submitted
$81.64 billion was paid out to provide financial assistance

The final numbers are not in yet, but it is clear that over $100 billion will have been paid out in CERB monthly payments.

CERB and the self-employed

In previous blogs, I provided a summary of who was eligible for CERB payments. You will also recall the ongoing snafu that occurred to self-employed people in what the Canada Revenue Agency (CRA) claims that they misinterpreted the minimum income requirements. I explained that whole kerfuffle in my recent blog “CERB REQUIREMENTS: ASTONISHING MIXUP UNDERSTANDING CERB REQUIREMENTS LEADS TO A BAD OUTCOME“.

I notice that even right now, the Government of Canada website shows:

“The Benefit is available to workers:……

Who had employment and/or self-employment income of at least $5,000 in 2019 or in the 12 months prior to the date of their application;…”

So the Federal Government’s own website still shows a misleading description of which self-employed individuals were eligible for CERB. If the interpretation is really “net income” as CRA contends, shouldn’t their own website say that? Self-employment income is a misleading term. “Self-employment net income” is a standard accounting term and is what CRA says it meant.

It is unfortunate that the self-employed who are screaming to our Federal politicians “I need financial help immediately Canada” cannot rely on the plain English words on the government’s own website.

CERB was part of Canada’s coronavirus economic response plan. Additional financial assistance was given to individuals by the Government of Canada in the form of:

Employment insurance program

Temporary modifications to the employment insurance program (EI) to better support Canadians who require financial aid. Since September 27, 2020, the minimum payment is $500 weekly on a gross basis (before income tax).

Canada Recovery Sickness Benefit (CRSB)

The CRSB gives $500 each week for as much as 2 weeks, for employees that:

Are not able to work for a minimum of 50% of the week due to the fact that they have gotten ill with coronavirus.
Are self-isolated for reasons connected to the coronavirus.
Have underlying conditions, are going through treatments or have acquired other sicknesses that, in the viewpoint of a medical practitioner, nurse practitioner, individual in authority, government or public health authority, would make them more prone to contracting the coronavirus.

Canada Recovery Caregiving Benefit (CRCB)

The CRCB offers $500 weekly for up to 26 weeks per household for employees:

Incapable of working at least 50% of the week since they are parents with children who need to care for a youngster under the age of 12 or family member since schools, day-cares or care facilities are shut because of the coronavirus since the child or member of the family is sick and/or required to quarantine or goes to high danger of severe illness because of the coronavirus.

Mortgage payment deferral

Most mortgage deferral programs have now ended. House owners who said I need financial help immediately Canada, who needed a time out from making their mortgage payments, might have qualified for a mortgage payment deferral.

The deferral was an agreement between the borrower and the banks or other mortgage lenders. I described the program in more detail in my blog “MORTGAGE DEFERRAL CANADA IS ENDING: 3 KILLER WAYS TO DEAL WITH COVID-19 RELATED MONEY PROBLEMS“.

These were the programs to help the average Canadian feeling the pinch and saying “I need financial help immediately Canada” because of the Covid 19 pandemic.

***I need financial help immediately Canada*: A review of 2020 emergency benefits for businesses**

Canadian small businesses have no doubt been hit the hardest in this Covid 19 mess. Provinces and regions within provinces have had differing approaches in severity, but they have all involved lockdowns. Due to the variety of goods sold in some big box stores, they have been allowed to stay open while specialty small retailers who spent money on making sure they abided by all Covid 19 protocols had to shut down. This has been especially hard on small retailers during the holiday retail shopping season.

There were several programs paying various amounts available as support for businesses. In no particular order, the main Government of Canada support programs for businesses are:

Canada Emergency Wage Subsidy (CEWS)

The Federal Government is paying up to 75% of employees’ salaries for qualifying eligible employers, with this CEWS subsidy rate now running until June 2021. The CEWS wage subsidy allows businesses to maintain and also re-hire staff members and hopefully stay clear of having to lay off employees.

Canada Emergency Business Account (CEBA) interest-free loans

The CEBA supplied an original amount of $40,000 in interest-free loans, to small businesses and not-for-profits. This program is to help support small businesses that have seen revenue drops because of the coronavirus yet face continuously fixed costs.

The government has just recently increased CEBA to consist of an additional interest-free $20,000 funding, raising the maximum amount to $60,000. If paid off by December 31, 2022, the amount of $20,000 is forgiven. If not, interest begins being charged on the full amount.

Businesses have until March 31, 2021, to apply for the $60,000 CEBA loan or the $20,000 increase. Applications are made to the banks or credit unions with which the business maintains one or more business accounts.

Canada Emergency Commercial Rent Assistance Program (CERC)

On Friday, April 24, Prime Minister Justin Trudeau revealed the launch of the CERC for small businesses that were strongly affected by the coronavirus pandemic and the resultant first lockdown. It was developed to reduce premises rent costs by 75 percent for affected local businesses.

The CERC was supposed to provide forgivable loans for commercial landlords that qualify under the strategy to cover half of the three normal monthly rent payments. It was designed to assist local businesses experiencing financial difficulties throughout April, May and June 2020.

The expense and monitoring of the CERC were shared by the provinces and the feds. So in Ontario, the Ontario provincial government and the Canadian Government were to share equally. Unfortunately, the program, like many of the others, had to be created very quickly. Although commercial tenants wanted this relief, the program was largely unsuccessful due to many uncooperative commercial landlords.

Canada Emergency Rent Subsidy (CERS)

As a result of this and businesses still clamouring “I need financial help immediately Canada“, the CERS program came into being replacing the CERC.

The CERS supplies a direct and easy-to-access rental cost and mortgage aid of approximately 65% of eligible expenditures to qualifying services, charities and non-profits. The aid prices hold up until December 19, 2020. This support is offered straight to lessees.

Lockdown Support

Businesses that have been substantially limited by a required public health order issued by a qualifying public health authority are truly screaming “I need financial help immediately Canada” and for good reason. They can obtain an added 25% of rental assistance via the Lockdown Support.

The consolidated impact of the rental cost subsidy and the Lockdown Support is that hard-hit companies, non-profits and charities subject to a lockdown can receive commercial rent assistance of a maximum of 90%.

The CERS and the Lockdown Support are both offered for businesses until June 2021.

Loan Guarantee for Small and Medium-Sized Enterprises

Through the Business Credit Availability Program, Export Development Canada (EDC) is dealing with banks and other financial institutions for this emergency loan program. The EDC will guarantee 80% of brand-new operating credit as well as term loans of as much as $6.25 million to both small and medium-sized businesses (SMEs).

This funding assistance is to be made use of for operational expenses as well as is available to both exporters and non-exporting firms.

This program is currently readily available at different banks and credit unions. This support is offered until June 2021.

Canada United Small Business Relief Fund

The Canada United Small Business Relief Fund gives grants of up to $5,000 to local businesses. These funds can be utilized for eligible expenses of particular initiatives: buying PPE, refurbishing physical rooms, or developing your website or e-commerce abilities.

These are the main programs for Canadian businesses saying to Ottawa “I need financial help immediately Canada” due to difficulties brought on by Covid 19.

***I need financial help immediately Canada*: 2021 emergency measures for individuals and businesses**

Now that I have reviewed the 2020 programs, some of which are continuing, I want to highlight the help for financial hardship that is still available in 2021 for the many who are still saying to Ottawa “I need financial help immediately Canada“. I caution that the information is as of the date of Brandon’s Blog. Any changes, additions or cancellations of or to support programs due to the Covid 19 crisis are not reflected.

I need financial help immediately Canada – Individuals

Canadians who still say to our federal politicians “I need financial help immediately Canada” can still avail themselves of several programs. The first is the Canada Recovery Benefit Fund (CRB). The CRB essentially replaces the CERB.

The CRB gives $500 weekly for no more than 26 weeks as a Covid 19 response. It is for people that have quit working or had their income lowered by at least 50% because of the coronavirus, and that are not qualified for Employment Insurance Benefits.

The main remaining programs available to individuals saying in 2021 “I need financial help immediately Canada“, are:

EI
CRSB
CRCB

I need financial help immediately Canada – Small Businesses

The main remaining emergency federal support programs for small businesses still saying “I need financial help immediately Canada” are the CEWS, CEBA and the CERS. They are all explained above.

I need financial help immediately Canada summary

I hope that you have enjoyed this I need financial help immediately Canada Brandon’s Blog. The COVID-19 pandemic has brought health damage and financial concerns to many Canadians.

The Canadian government quickly invoked many new financial support programs for both Canadian companies and individuals to try to lessen the financial strain and bring peace of mind to many.

For all the various glitches, the Federal Government has done a very decent job in rolling out these economic support measures to try to keep the Canadian economy going.

At the same time, our front-line health care workers have been heroes. They fight daily to keep all of us safe. We owe them a great deal of gratitude.

If you are worried because you are facing significant financial challenges and you don’t fully understand the options available to you, including, filing a consumer proposal versus bankruptcy. It is not your fault that you are in this situation. You have been only shown the old ways that do not work anymore.

The Ira Smith Team uses new modern ways to get you out of your debt troubles while avoiding bankruptcy. We can get you debt relief freedom.

Ira Smith Trustee & Receiver Inc. offers a full range of insolvency services to people facing a financial crisis. Whether you need help with a proposal to your creditors to avoid the worst case, financial counselling or advice about insolvency options, our goal is to make sure that you understand the process, your choices, and what steps will get your life back on track.

Call us for your free first consultation. We will inform you about all the choices readily available so you can make a proper decision about the very best plan to deal with your financial obligations.

Call Ira Smith Trustee & Receiver Inc. today. All you have to lose is your debt!

We will get you or your company back on the road to healthy stress-free operations and recover from the pain points in your life, Starting Over, Starting Now.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

We hope that you and your family are safe and healthy. For those that celebrate it, we wish you all a very Merry Christmas. To everyone, we wish you a healthy, happy and secure 2021.

Tags Bankruptcy, canada emergency rent subsidy, Canada Emergency Response Benefit, canada emergency wage subsidy cews, canada recovery benefit fund, ceba, cerb, CERS, cews, Consumer Proposal, coronavirus, covid-19, CRB, I need financial help immediately, i need financial help immediately canada, Ira Smith Trustee, loan guarantee, lockdown support, mortgage payment deferral

Brandon Blog Post

CONSUMER PROPOSAL VERSUS BANKRUPTCY: MASTER THIS KNOWLEDGE AND BE SUCCESSFULLY DEBT FREE

Post author By Brandon Smith
Post date December 21, 2020

We hope that you and your family are safe and healthy.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

If you would prefer to listen to the audio version of this consumer proposal versus bankruptcy Brandon’s Blog, please scroll to the very bottom and click play on the podcast.

Consumer proposal versus bankruptcy introduction

The holidays are upon us and we can all ideally get a well-deserved break. This 2020 year truly threw us a curveball in March and it isn’t over yet. Many people have already identified that they need to understand their options in taking care of way too much debt. Hopefully, they will use the period of time during the holiday break downtime to seriously consider fixing their situation.

Maybe their New Year’s resolution will be to once and for all solve their financial situation. That is why I believe this is a good time to write this Brandon’s Blog to help those people who are wondering about the issues surrounding a consumer proposal versus bankruptcy.

***Consumer proposal versus bankruptcy*: Who qualifies for a consumer proposal?**

A consumer proposal is an alternative to bankruptcy. Consumer proposals are for people whose total financial debts do not surpass $250,000, not including financial debts secured by their primary house.

Division 1 proposals are available to both:

companies; and
individuals whose debts exceed $250,000 (leaving out mortgages on their principal home).

I will focus on the differences between a consumer proposal versus bankruptcy.

***Consumer proposal versus bankruptcy*: What are consumer proposals?**

Consumer proposals are formal ways governed by the Bankruptcy and Insolvency Act (Canada) (BIA) available only to people. Working with a licensed insolvency trustee (Trustee) acting as the consumer proposal administrator, you make a proposal to:

Pay your creditors a percentage of what you owe them over a specific period not exceeding 60 months
Extend the time you have to pay off the debt
Or a mix of both

Payments are made through the Trustee, and the trustee uses that money to pay each of your creditors. The consumer proposal must be completed within 5 years from the date of filing.

Below I will highlight more differences between a consumer proposal versus bankruptcy.

***Consumer proposal versus bankruptcy*: Is a consumer proposal worth it?**

The advantages of a consumer proposal versus bankruptcy are:

You keep all of your assets
Legal actions that are being contemplated or actually begun against you by unsecured creditors and results of a judgment such as freezing your bank account and wage garnishments are stopped.
Unlike informal debt negotiation or debt settlement programs, the consumer proposal forum catches all of your debts and your unsecured creditors must take part in your restructuring process.
Of all the debt relief options available to a person, it is the only government-approved program that combines debt consolidation (without having to apply for one or more loans) and debt settlement.
You do not need to use the “B” word.

You will definitely pay less than you owe with a consumer proposal. It could be as much as 75% less. All of your unsecured debts will be consolidated right into a simple regular monthly payment. What you pay is based on what your creditors could expect to receive in your bankruptcy and what you can actually afford.

So is a consumer proposal worth it to make one monthly payment that you can afford to pay a portion of the total you owe instead of going bankrupt? I think it is.

What is the impact on my credit rating if I file a consumer proposal versus bankruptcy?

We are always asked, “How will a consumer proposal affect my credit rating?”. The follow-up question is “What is the impact on my credit rating if I file for personal bankruptcy or do a consumer proposal?”.

The person who files for bankruptcy will absolutely obtain R9 status. This is the lowest credit score possible. It will remain on their credit report for 6 years after the person gets their bankruptcy discharge. So for a first-time bankruptcy with no surplus income and the person gets their discharge after 9 months, it is on the credit report for about 7 years. If the person is a first time bankrupt with surplus income, then their bankruptcy discharge cannot be gotten for at least 21 months. This equates to having the R9 for 8 to 9 years.

An individual that files a consumer proposal sees their credit score go to an R7 ranking which is less extreme. It will remain to be on their credit report for around 8 years in total, starting with the filing date.

Through the two mandatory credit counselling sessions that are provided with either a consumer proposal or bankruptcy, we teach you ways you can start rebuilding your credit score right away.

What are the costs and fees of a consumer proposal versus bankruptcy?

When doing a consumer proposal as a debt solution, the Trustee costs are included in the settlement you bargain with your creditors. The calculation of what is reasonable for you to pay is done without any reference to the Trustee costs.

For example, if your consumer proposal has you paying a regular monthly payment of $400 for 60 months, the Trustee’s fee and disbursements are taken from those funds. The consumer proposal fee is a tariff defined in the BIA.

If there is no surplus income or assets that you hand over to the Trustee, the cost for this type of personal bankruptcy is about $2,000. This cost would need to be paid to the Trustee either upfront or over an 8 month period in equal monthly payments.

However, if you file for bankruptcy and you have surplus income and/or assets that you must turn over to the Trustee, the personal bankruptcy cost could be higher. The Trustee’s fee and costs must be taxed by the Court. However, it will be calculated using the hours spent by the level of staff at each staff member’s normal hourly rate. If there are insufficient assets to pay the Trustee’s fee, the difference has to be paid for by the bankrupt person or someone else guaranteeing the Trustee’s costs.

This is another distinction between bankruptcy vs consumer proposal.

What happens to my assets in a consumer proposal versus bankruptcy?

If you do a consumer proposal, you keep your assets. In bankruptcy, other than for exempt assets, your assets are seized by the Trustee. Exemptions depend on the province you live in.

In Ontario the assets you get to keep in bankruptcy consist of:

The equity in your home of no more than $10,000.
A motor vehicle with an equity value of no more than $6,000.
Clothing and medical and dental aids.
Household furnishings up to a value of $13,100.
Tools of the trade with a value of no more than $11,300.
Pensions, RRIF, RRSP (except for any RRSP contributions made within 12 months of the date of bankruptcy).
Farmers – no more than $29,100 for animals and tools and equipment.

This difference to your assets between a consumer proposal versus bankruptcy is massive.

What happens if I miss payments and default on my consumer proposal versus bankruptcy payments?

If you do not maintain your payments on a consumer proposal, it defaults and it is over. You then cannot file a new one. Collection action by your creditors will begin again.

If you do not complete all your duties in bankruptcy, you will definitely not be discharged. If your Trustee gets discharged and you remain undischarged, then all your creditors can return to taking collection action against you to try to recover on their loans or other debt payments you owe them.

This is one more consumer proposal versus bankruptcy difference.

When is a meeting of creditors held in a consumer proposal?

A meeting of creditors in a consumer proposal is held if one is requested by one or more creditors who are owed at least 25% of the overall value of the proven claims.

A request for a meeting has to be made by the creditors within 45 days of the declaration of the consumer proposal. The Office of the Superintendent of Bankruptcy (OSB) can also ask for the Trustee to call a meeting of creditors whenever within that specific very same 45-day time frame.

The meeting of creditors is held within 21 days after being called. At the creditors’ meeting, they elect to either approve or turn down the proposal.

If no meeting of creditors is requested within 45 days of the filing of the proposal, the proposal will be regarded to have actually been approved by the creditors no matter any kind of objections received later.

A consumer proposal is fully performed as soon as:

the person has made the required payments within the time period called for in the consumer proposal; and
the two mandatory counselling sessions with the Trustee have been done.

In a bankruptcy, the discharge relies on various facets, including whether it was the first time the debtor filed for bankruptcy and if they need to make surplus income payments to the Trustee. The calculation for surplus income is based mainly on your household monthly income.

If the debtor has actually never ever declared bankruptcy before as well as they do not have to make surplus payments, the bankrupt is entitled to be released 9 months after declaring bankruptcy. Nevertheless, if the bankrupt has surplus income, they will require to make payments for 21 months before they can be discharged.

This is one more distinction between a consumer proposal versus bankruptcy.

***Consumer proposal versus bankruptcy*: How to file for bankruptcy?**

In order to file, you need to engage a Trustee. This is a person or company accredited by Industry Canada to administer the insolvency process in Canada.

The 11 steps below are a guide to the filing for bankruptcy process:

Contact a Trustee and attend a meeting with him or her to speak about your personal situation and your options. This will include all your options to avoid bankruptcy.
Deal with the Trustee to complete the necessary bankruptcy documents.
The Trustee will after that submit the bankruptcy paperwork to the OSB and get back a certificate evidencing your bankruptcy.
The Trustee notifies your creditors of the bankruptcy.
You attend a meeting of creditors if one is called.
You participate in 2 counselling sessions.
Based on your provincial exemptions, the Trustee sells your non-exempt assets; you may likewise need to make surplus income payments to the Trustee.
In certain conditions, you might have to participate in an evaluation by an officer at the OSB.
The Trustee prepares a report to the OSB describing your activities during the bankruptcy.
You go to the discharge hearing if required.
You get your discharge from your bankruptcy and afterwards, the Trustee completes the management of your bankruptcy file, including paying a dividend to your creditors, if available.

As you can see from the description of how a consumer proposal works and from these 11 steps, there is a difference in how a consumer proposal versus bankruptcy works.

***Consumer proposal versus bankruptcy*: Get back to a stress-free life**

I hope you have enjoyed this consumer proposal versus bankruptcy Brandon’s Blog. Both a successfully completed consumer proposal or obtaining your discharge from bankruptcy lets you get back on the road to financial health, relieve the stress you face and bring you:

Freedom by getting out from under garnishments;
The ability to live better than just hanging on one payday to the next;
Improved credit ratings; and
Improved health and well-being.

You are worried because you are facing significant financial challenges and you don’t fully understand the options available to you, including, filing a consumer proposal versus bankruptcy. It is not your fault that you are in this situation. You have been only shown the old ways that do not work anymore. The Ira Smith Team uses new modern ways to get you out of your debt troubles while avoiding bankruptcy. We can get you debt relief freedom.

Call Ira Smith Trustee & Receiver Inc. today. All you have to lose is your debt!

We will get you or your company back on the road to healthy stress-free operations and recover from the pain points in your life, Starting Over, Starting Now.

We hope that you and your family are safe and healthy.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Tags alternative to bankruptcy, Bankruptcy, Bankruptcy and Insolvency Act, bankruptcy discharge, BIA, Consumer Proposal, consumer proposal versus bankruptcy, credit score, debt consolidation, how will a consumer proposal affect my credit rating, Ira Smith Trustee, licensed insolvency trustee, Office of the Superintendent of Bankruptcy, OSB, surplus income, trustee, What is the impact on my credit rating if I file for personal bankruptcy or do a consumer proposal, Who qualifies for a consumer proposal

Brandon Blog Post

FILE BANKRUPTCY IN CANADA ONLINE: OUR COMPLETE GUIDE ON HOW TO FILE BANKRUPTCY ONLINE

Post author By Brandon Smith
Post date December 16, 2020

We hope that you and your family are safe and healthy.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

File bankruptcy in Canada online introduction

People have been asking us recently, “Can I file bankruptcy in Canada online?”. The most honest answer is yes, just not all alone with your computer and internet connection. Doesn’t sound very definitive, does it? That is because you cannot file bankruptcy yourself.

The only one the federal government authorizes in Canada to do bankruptcy filings is a licensed insolvency trustee (formerly called a bankruptcy trustee or a trustee in bankruptcy) (Trustee). The process itself requires anyone experiencing financial problems either themselves or with their company, needs to meet with a Trustee for an initial consultation.

However, since the onset of the COVID-19 pandemic and the lockdowns that have accompanied it since March 2020, the way a Trustee meets with people considering bankruptcy has changed. It has essentially gone online given the current operating environment. I will explain what I mean and how it might help you with your individual situation.

Can I file bankruptcy in Canada online?

Virtually anything and everything can be done online. The lockdown has increased our use of online purchasing. Whether it is clothes, office supplies, or toilet paper, it can all be ordered online and shipped to our homes. The taxi industry has been under assault for some time now from both Uber and Lyft.

The internet also includes a wealth of knowledge on thousands of different subjects. Financial topics are no exception. I find that anyone contacting me who is struggling with their, or their company’s financial problems, debts and paying their bills, including credit card bills, have already looked online for information and help to try to recover for their financial future.

Although people may not understand everything about insolvency and bankruptcy with all its nuances, which is to be expected, callers are definitely more educated in options for help in dealing with their secured creditors, unsecured creditors and different types of debts – both secured debt and unsecured debt.

So nowadays, everyone expects that you can do everything online, including the ability to file bankruptcy in Canada. This is true for people who think bankruptcy might be a solution for them. They are curious to understand if they can declare bankruptcy online. It is no longer just a bankruptcy in-person system.

file bankruptcy in canada

How the coronavirus pandemic pushed bankruptcy online

The bankruptcy law in Canada is a federal statute. So the Canadian government supervises the administration of the insolvency process in Canada through the Office of the Superintendent of Bankruptcy Canada (OSB). On March 13, 2020, as a result of COVID-19, the OSB provided guidance to Trustees about how elements of the process for filing bankruptcy in Canada have changed. The document issued by the OSB is called Temporary Guidance for LITS During the COVID-19 Pandemic.

In that guidance, the OSB pushed the Canadian insolvency system as close to how can you file bankruptcy online. The only thing you still cannot do is file bankruptcy online yourself.

There was great growing concern in Canada about COVID-19. Insolvency practitioners had to take action to reduce in-person meetings. The OSB supported the Trustee community in these initiatives while keeping the stability of Canada’s insolvency system.

The OSB encouraged Trustees to make use of the considerable flexibilities that exist in the OSB’s Directives when determining which measures may be appropriate, in light of the pandemic.

To allow for the necessary social distancing, while still allowing people to file bankruptcy in Canada, the OSB advised the Trustee community:

Assessment of a person’s or company’s financial situation – Trustees are allowed to make use of techniques besides in-person meetings. The OSB recognized the COVID-19 pandemic as a remarkable circumstance.
- Trustees did not need to get separate approval to conduct assessments making use of techniques aside from in-person. Where a video conference is not feasible, evaluations and discussions about a person’s or company’s debt situation may be carried out through a mix of telephone discussion and email.
- In these assessment meetings, we discuss various debt relief options and alternatives to bankruptcy to avoid bankruptcy. We talk about credit counselling sessions, debt consolidation, debt settlement, various financial management techniques. We even discuss is a debt consolidation loan a realistic prospect?
- Then we move on to the insolvency remedies of a consumer proposal for financial reorganization and debt settlement, corporate financial reorganization, personal bankruptcy or corporate bankruptcy. Whatever is appropriate. Then we give the person our recommendations and help them pick the best solution for them. The aim is always to avoid bankruptcy, wherever possible.
Insolvency financial counselling – Trustees and the accredited credit counsellors in their office are allowed to give financial management counselling via video conferencing. The OSB also allowed for credit counseling over the telephone, when video conferencing is not feasible. That is how I have been doing each credit counselling session and it has been working very well.
Meeting of Creditors – The Chair of the meeting is now allowed to hold creditors’ meetings either by video or conference call. The Chair can count on the representations by those in attendance to confirm their identity. It is mainly the unsecured creditors who are interested in the meeting of creditors.
Oaths and Signatures: Filing for bankruptcy and the bankruptcy process, involves bankruptcy forms. We are now urged to trade bankruptcy paperwork using e-mail. Trustees also explain to anyone filing bankruptcy, be it personal bankruptcy or corporate bankruptcy, using video conferencing.
This also the case for a consumer proposal filing. So even though we are not sitting in the same room as the person, we give the debtor the required support to explain the bankruptcy forms by using Zoom, FaceTime or over the phone.

What I do for taking oaths is that I confirm the person’s name and ask them to hold up their birth certificate or driver’s licence to their webcam or mobile phone. I also watch them sign the official bankruptcy documents. Then, I ask them to scan everything, including the identification they used, email it to me right away and then put the originals in the regular Canada Post mail.

So far, this has worked quite well. It has allowed people to file bankruptcy in Canada even during a pandemic. It has worked so well, we are now helping people and entrepreneurs looking for debt relief options who otherwise could not travel to our office. They would not travel to see us in person because although they are in Ontario, they are not in the Great Toronto Area.

Trustees already use an online bankruptcy filing system

Once the Trustee receives the documents by email from the person, they then turn to the electronic online bankruptcy filing system. It is called the E filing system. The Trustee can upload certain computer files into the E filing system, to tell the OSB all the information it needs to issue the Certificate of Appointment.

It is the same system across the country, regardless of what province you are in when someone wants to file bankruptcy in Canada. When the OSB issues the Certificate, that is the moment when a person or company officially becomes bankrupt and the Trustee is appointed.

This same E filing system is used also for all filings. Things like a consumer proposal, corporate receivership and corporate restructuring filings are also uploaded through the same online portal.

***File bankruptcy in Canada*: The rest of the process is the same as before**

Once the type of online bankruptcy or consumer proposal filing is made to help you with the debt solutions you need, the rest of the process is the same. How bankruptcies work in Canada from this point on is not really different, other than as stated above, the two mandatory counselling sessions are done by either video or telephone meeting. Also, the effect on someone’s credit report is the same.

To find out the information on how the overall process works when you file bankruptcy in Canada, take a look at my Brandon’s Blog – HOW TO FILE FOR BANKRUPTCY IN CANADA: PERSONAL BANKRUPTCY MODUS OPERANDI. That will give you a very good read on the entire process.

File bankruptcy in Canada online: A word of warning

A word of caution for you. Bear in mind at the beginning I told you that only a Trustee is licensed to do any insolvency filing in Canada. You should understand that to file bankruptcy in Canada or file a consumer proposal online in Canada with someone that is not licensed by the federal government as a Trustee isn’t a choice.

You must be aware of fake organizations, firms, or service providers that attempt to trick people right into believing they can do any kind of insolvency filing for you. This includes anyone wanting to file bankruptcy in Canada.

Sadly, there are many debt consultant bankruptcy scam artists that state that they can help you do a debt settlement for you for a fee. DO NOT think of them under any circumstances. All they do is charge you for the first bankruptcy assessment of a person’s financial situation that a Trustee will do for you at no cost.

Then they try to offer you more items that the state will certainly help improve your credit score. This may also include giving you a high-interest rate loan but holding back all the cash to make the monthly payments out of until gone. Then when they cannot sell you any more products, they walk you down the block to file with a Trustee either to do a consumer proposal or to file bankruptcy in Canada.

Do not fall for these scammers that make it seem like they can file bankruptcy in Canada for you.

File bankruptcy in Canada summary

I hope you have enjoyed this file bankruptcy in Canada Brandon’s Blog. Do you or your company have too much debt? Are you or your company in need of financial restructuring? The financial restructuring process is complex. The Ira Smith Team understands how to do a complex restructuring. However, more importantly, we understand the needs of the entrepreneur or the person who has too much personal debt.

The stress placed upon you is huge. We understand your pain points. We look at your entire situation and devise a strategy that is as unique as you and your problems; financial and emotional. We know that we can help you the way we take the load off of your shoulders and devise a debt settlement plan.

We know that people facing financial problems need a realistic lifeline. There is no “one solution fits all” approach with the Ira Smith Team. Not everyone has to file bankruptcy in Canada. We help many people and companies avoid bankruptcy.

Call us now for a free consultation.

We will get you or your company back on the road to healthy stress-free operations and recover from the pain points in your life, Starting Over, Starting Now.

We hope that you and your family are safe and healthy.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Brandon Blog Post

CERB REQUIREMENTS: ASTONISHING MIXUP UNDERSTANDING CERB REQUIREMENTS LEADS TO A BAD OUTCOME

Post author By Brandon Smith
Post date December 14, 2020

We hope that you and your family are safe and healthy.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

If you would like to listen to the audio version of this CERB requirements Brandon’s Blog, please scroll to the very bottom and click play on the podcast.

CERB requirements introduction

This year that is soon ending (YAY!!) has certainly been full of new learning experiences because of the COVID-19 pandemic. CERB requirements are just one of them. Since March, I have been writing about different financial issues relating to Canada’s COVID-19 Economic Response Plan, including the Canada Emergency Response Benefit (CERB). My two prior blogs on CERB were:

Even though the CERB program has ended, we now find that a new CERB requirements issue has just arisen concerning self-employed people. I will describe it for you.

A CERB requirements refresher

Just to refresh your memory, I think an overview of the Canadian CERB requirements will nicely set the stage.

To be eligible for the $2,000 CERB payment by applying to the Canada Revenue Agency (CRA), you have to have met particular CERB requirements for each of the CERB periods you were applying for. The Government of Canada specified the eligibility criteria to be:

You did not try to find or get, CERB or Employment Insurance from Service Canada for the specific CERB dates being applied for.
You did not stop your work voluntarily.
You reside in Canada and are at least 15 years of age.
You earned a minimum of $5,000 (before taxes) in the preceding 12 months, or in 2019, from 1 or more of:
- work earnings
- self-employment income
- provincial benefit payments for maternity or parental leave
- 1 of:
  - Your work hours have in fact been decreased as a result of COVID-19.
  - You have actually quit or will quit working because of COVID-19.
  - You are unable to work as a result of COVID-19, for example, due to the fact that you are caring for a person.
  - You have actually been paid EI benefits for at the very least one week of benefits after December 29, 2019, and finished your entitlement to such benefits.
One of:
- If you are applying for the first time: You have actually quit or will stop working, or you are working decreased hours, as a result of the coronavirus. Additionally, you don’t expect to earn over $1,000 in gross employment or self-employment income for at least 14 days straight during the 4-week period.
- If you are applying for a subsequent period: You are still not employed or self-employed, or you are doing lowered hours because of COVID-19. You do not anticipate making over $1,000 in gross employment or self-employment income, and you expect this to continue throughout the whole 4-week duration.

The Canadian CERB program is finished. The CRA accepted and paid retroactive applications until December 2, 2020. Now they are doing audits to see if people who received CERB did not actually qualify. This has uncovered a problem unique to self employed people.

The $5,000 CERB requirements problem

The $5,000 consists of all employment income and self-employment income. This includes among others: gratuities you have declared as earnings; non-eligible dividends; nominal amounts paid to emergency service volunteers; and royalties (e.g., paid to artists). If you are not eligible for Employment Insurance, you might additionally include pregnancy and parental benefits you obtained from the Employment Insurance program and/or comparable advantages paid in Quebec under the Quebec Parental Insurance Plan.

Pensions, student loans and bursaries are ruled out as employment income and must not be included.

So why is the $5,000 threshold of CERB requirements a problem for the self-employed?

Are CERB requirements gross?

The issue that has recently been uncovered for self-employed workers in the calculation of income. The employment and or self employment income does not need to be earned in Canada, but you need to reside in Canada. But the eligibility requirements, rules and eligibility criteria when it comes to self employed income have been misinterpreted.

Self employed Canadians have said that when they reviewed the government of Canada’s CERB website, they read that their business had to have earned (before taxes) a minimum of the $5,000 threshold. The devil is really in the details.

To “earn” $5,000, if you are deducting business expenses, which you should be, then your net income must be the minimum of $5,000 in order for you to earn $5,000. CRA and Service Canada spokespeople have now confirmed this.

Unfortunately, it appears that many self employed individuals misinterpreted this. They believed that if they billed gross income of a minimum of $5,000 (before taxes) in the preceding 12 months, or in 2019, then they met the cerb. They applied for CERB and received their payments totalling some $14,000. If they billed way more than $5,000 and after deducting expenses to earn that income their net income before tax is still above the $5,000 threshold, then there is no problem.

However, if they billed not much more than the $5,000 and after deducting expenses their net income is either minimal or has created a business loss, then they do have a problem because they will not have met the threshold of the CERB requirements.

So the CERB requirements are not gross. They are net.

What is CRA now saying?

CRA has now sent letters to many self employed people. It has been estimated in the media that CRA has identified to date some 200,000 self employed that CRA believes received CERB but did not meet the CERB requirements. The letters advise that, for self-employed Canadians, the qualifying earnings had to be “net pre-tax income,” which means gross income minus the expenses incurred to earn that gross income.

Self employed Canadians who misinterpreted the CERB requirements and requested and received CERB based upon their gross income made a mistake. They are being told by CRA that they will need to pay back up to $14,000 worth of benefits, according to many social media posts and news reports. Sounds simple, right?

It may sound simple, but, the misinterpretation of the CERB requirements has now caused many problems. The money was applied for because Canadians needed help with daily living expenses due to the economic effects of the COVID-19 pandemic. The money has been spent.

If the CERB money is not returned to the government before January 1, 2021, every self employed person in this conundrum will have to pay tax on the CERB amount received in 2020. Hopefully paying income tax on the CERB is not something these Canadians also did not overlook or misinterpret. Even if they pay the income tax when they file their 2020 income tax return, there is no guarantee that CRA will not still continue trying to collect the CERB payments.

There is a simple fix, but, will the Federal Government use it?

In my view, there is a simple fix for anyone who ran their own business as either a sole proprietor or partner and who received such a letter from CRA about their not having met the CERB requirements. It is a simple fix, but it will require what must be considered out of the box thinking for the government.

These people applied for CERB because they were hurting financially. They needed this help to buy food, pay rent, make mortgage payments. It wasn’t used for travel and fancy dinners. The last thing these people need is to repay the money they do not have anymore. So what is the simple fix? Let them keep the money and do not demand repayment. Let these people pay the income tax on that money.

If critics want to make sure that it does not look like these people took from the government in order to merely survive, then you could always deny them business expenses that would otherwise qualify up to the amount of CERB money they received. That way the government will collect additional income tax from them.

Given all the circumstances and the true reason for sending out the CERB money in the first place, it would be an awful ending for these people to be faced with being chased by CRA collection people for repayment.

CERB requirements summary

I hope you have enjoyed this CERB requirements Brandon’s Blog. Do you or your company have too much debt? Are you or your company in need of financial restructuring? The financial restructuring process is complex. The Ira Smith Team understands how to do a complex restructuring. However, more importantly, we understand the needs of the entrepreneur or the person who has too much personal debt.

You are worried because you are facing significant financial challenges. It is not your fault that you are in this situation. You have been only shown the old ways that do not work anymore. The Ira Smith Team uses new modern ways to get you out of your debt troubles while avoiding bankruptcy. We can get you debt relief freedom.

We know that people facing financial problems need a realistic lifeline. There is no “one solution fits all” approach with the Ira Smith Team.

Call us now for a free consultation.

We will get you or your company back on the road to healthy stress-free operations and recover from the pain points in your life, Starting Over, Starting Now.

We hope that you and your family are safe and healthy.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Tags $5000, Bankruptcy, Canada Revenue Agency, cerb, cerb dates, cerb periods, cerb requirements, cerb requirements for self employed, Consumer Proposal, covid-19, CRA, Debt, employment insurance, Ira Smith Trustee, self employed, self employment, Service Canada

Brandon Blog Post

HOLIDAY SPENDING: HOW DO I STOP OVERSPENDING DURING THE HOLIDAYS?

Post author By Brandon Smith
Post date December 9, 2020

We hope that you and your family are safe and healthy.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Holiday spending introduction

The holiday sales days of Black Friday and Cyber Monday holiday retail shopping are over. You may feel you tend to overdo it on your annual holiday spending and that will put you in a poor financial position entering into 2021. On the other hand, COVID-19 has made a lot of people anxious and even depressed. You want to buy something nice this Canadian holiday season for your loved ones and close friends to cheer them up.

So I have created our holiday spending in Canada tips to attempt to help with your holiday shopping. Ideally, by following our suggestions, you will not go into the New Year with more financial debt than you can take care of. You ideally will have avoided the most typical holiday spending mistakes and not end up being one of the miserable holiday shoppers who have awful holiday spending habits.

***Holiday spending*: Tale of two countries?**

The COVID-19 pandemic has devastated the U.S. economy and kept lots of would-be consumers at home this year. Nationwide US consumers are expected to spend much less on gifts and various other holiday-related merchandise than they did last year. So many Americans are hurting because the federal government has not gotten the much-needed relief to people and businesses in the United States.

On the other hand, in Canada, the federal government has distributed relief very quickly. It has come as monetary support for citizens and businesses. It has also come in the form of mortgages and other loan deferrals. By the end of 2019, most, but not all of the Canadian government coronavirus support will end.

As I have written in previous blogs, the combination of government support payments and people staying at home, has resulted in people spending less. They have been able to put money towards paying down debt. Although debt levels are still high, they have been reduced over the last 10 months.

CPA Canada, the association that represents Chartered Professional Accountants of Canada, did a survey on the holiday outlook for this year. According to the CPA Canada survey, most Canadians’ spending will be on gifts: $588 this year versus $583 in 2019. So according to that survey, Canadians will spend, on average, the same this holiday season as last year. Perhaps the only question might be will they do more online shopping this year than in previous years? It will certainly be interesting to see the holiday spending retail sales report early next year.

How will Canadians buy for this year’s holiday spending?

Gifts are only one portion of total holiday spending. Traditionally, travel was always a large part of non-gift holiday spending. The CPA Canada holiday spending survey shows that Canadians have spending plans to spend the same on gifts as they did last year. However, due to the coronavirus pandemic, travel spending will certainly be far less than in prior years. It could even be essentially eliminated. This will create lower total holiday spending in Canada in 2020.

Another major trend sped up by the pandemic is a curbside pick-up. Many Canadians will select this approach for their online purchases. The reality is that Gen Z and Millennials use this approach or get their purchases delivered to them all year round – not just for their holiday spending.

Canadian adults aged 55-plus are traditionally the last to use curbside pickup or delivery. This holiday season may be very different for this group of Canadians. Health concerns may very well drive them to more online shopping this holiday shopping, given the reality of our current environment. holiday spending

Holiday spending budgeting

It is so important that you really think out your holiday spending budget plan before you start spending. I think there are 3 major classifications to your holiday budget: (i) presents; (ii) food and beverage in your home; and (iii) what you might spend in clothing and other amounts because of various holiday parties you would normally be attending. This year I don’t think there will be much spending relating to holiday parties as most, if not all, are cancelled.

To begin setting your holiday spending budget plan, you require to establish 2 different mini-budgets. For gifts, the first thing is to write down the names of everybody you feel you want to get holiday gifts for. Then write down only those who you must buy a gift for. You might not have the ability to afford your “wants”, however just your “needs”.

Check out your regular monthly income and expenses as well as any kind of savings you may have assigned for holiday costs. Also, look at your spending habits to understand what your needs will be over the first few months of the New Year. This will better equip you to understand just how much you can spend overall without going into holiday financial debt.

You also need to then estimate your spending on food and drink for your holiday entertaining this year. That number may very well be less than in previous years as people are being encouraged to not congregate in the same large numbers as they have previously.

Use your holiday spending calculator and take all of this into account, you can set with some degree of confidence your gift and other holiday spending budgets. Then you have to follow them!

My 6 best holiday spending tips

Here are my 6 best holiday spending tips:

Purchase with a purpose – You have now determined just how much you can safely spend on each person. Locate the ideal items that meet your costs goal. You do not have to think of price anymore since you will adhere to your specific gift cost limits. You can now focus only on suitable gifts within your budget restrictions. Purchase gifts that fit within your budget plan.
Only buy with cash money – You will certainly be enticed to get with your credit card. Using plastic will certainly trigger you to spend too much due to the fact that you will not really feel the purchase. To really feel the purchase, just use cash. When you feel it, you don’t spend too much. You will likewise prevent the awful surprise in January due to the fact that you will not receive an out of control charge card statement that you will not be able to settle fully. You will not only feel wonderful in December; you will have that same or even a better feeling in January.
Consider a family present to conserve money – If you feel you won’t have the ability to pay for individual presents, think about the members of the same household and look for a family gift. A gift card for the family may be more affordable than the total of individual presents. Don’t forget to take a look at that choice. Or perhaps one thing for the house that you know all family members will take pleasure in. There are many possibilities for a family present and you will still have an enjoyable shopping experience.
You have many talents so give of yourself, not your money – Don’t assume that the only gift that counts is one that costs money. You can actually do a buy nothing day for someone. You have many abilities and talents. Probably one or more would make a great present. If you cannot consider anything unique you can supply that would make a fantastic present, how about your time as an item? Babysit for nieces or nephews, give an afternoon to an ageing relative that needs help either in the house or getting around for errands. These can all count as important presents that won’t cost you anything or much at all. Your time and theirs spent together are much more precious than any type of present you would get in a shop.
Visualize the decorations – If you don’t currently have a box of ornaments from years past to use, visualize creatively. The accessories bought at a Dollar Store will look just as wonderful on your tree as ones purchased at a much more expensive specialty shop. Or, use your own creative thinking to make your own decors. If you aren’t certain where to begin, search the numerous videos online to teach you how to make terrific looking decorations that do not set you back too much for materials. Your work, certainly, is cost-free and you will get such joy out of seeing your own creations on your tree and in your home. Why not spread such joy to yourself first; you deserve it.
Do you have reward points you either do not see making use of or will quickly expire? – You have been collecting the points. You undoubtedly thought they would certainly give you something extra you may not otherwise be able to afford. Perhaps you might lose them or even otherwise, you don’t see on your own being able to use them in the foreseeable future. So, why not use them for an appropriate gift or gifts for those you need to buy for? You will also save time because more than likely, buying with points means that you are shopping online. You will certainly feel good about using them in this manner due to the fact that you will be making use of the points for someone important in your life. You will also feel good about not having to spend the cash. The people you get the gifts for will cherish your gift, never knowing that you didn’t have to spend cash to get them. It is a win-win.

I wish all of our readers a Happy Chanukah, a Merry Christmas and a healthy, happy and prosperous 2021.

Holiday spending: What if you already have too much debt?

I hope you have enjoyed this holiday spending Brandon’s Blog. Do you or your company have too much debt? Are you or your company in need of financial restructuring? The financial restructuring process is complex. The Ira Smith Team understands how to do a complex restructuring. However, more importantly, we understand the needs of the entrepreneur or the person who has too much personal debt.

We know that people facing financial problems need a realistic lifeline. There is no “one solution fits all” approach with the Ira Smith Team.

Call us now for a free consultation.

We will get you or your company back on the road to healthy stress-free operations and recover from the pain points in your life, Starting Over, Starting Now.

We hope that you and your family are safe and healthy.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Tags budget, Chanukah, Christmas, covid-19 pandemic, CPA Canada, CPA Canada survey, Debt, holiday budget, holiday season, Holiday Shopping, holiday spending, holiday spending habits, holiday spending tips, Ira Smith Trustee, online shopping, retail sales

Declaring bankruptcy in Canada: Introduction

When can you declare bankruptcy in Canada?

What happens when you declare bankruptcy in Canada?

Declaring bankruptcy in Canada: What assets do you lose in bankruptcy?

Declaring bankruptcy in Canada: Does Bankruptcy clear tax debt in Canada?

Declaring bankruptcy in Canada: What debt does bankruptcy not cover?

Declaring bankruptcy in Canada summary

Paying down debt No. 1 financial goal of Canadians for 2021: Poll

How Debt Affects Your Credit Scores

Why Credit Card Debt Is So Dangerous: My paying down debt calculator

How Personal Loans Impact Credit Scores

7 hacks for paying down debt quickly

How to get out of debt on a low income

Paying down debt: Do you want an avalanche of snowballs?

Can I book a meeting with someone who can help?

CPP premiums introduction

The Canada Pension Plan and CPP premiums

CPP premiums and annual maximum pensionable earnings bump-up

Moratorium on CPP premiums increase requested by provinces and business groups

The federal government response for a moratorium on the CPP premiums increase

CPP premiums summary

Brandon’s Blog posts introduction

What are blog posts?

What makes good blog posts?

How do I write my Brandon blog posts?

Top 10 insolvency-related Google searches in 2020 leading people to Brandon Blog posts

The Brandon Blog posts the top 10 insolvency-related Google searches in 2020 lead people to

Blog posts summary

A mortgage with bad credit introduction

Mortgages and the coronavirus

How your credit score impacts your mortgage rate

What kind of bad credit mortgages are available?

What are the advantages of bad credit mortgage loans?

What if I can’t get approved for a mortgage with bad credit loan at an A or B lender?

Mortgage with bad credit summary

I need financial help immediately Canada introduction

I need financial help immediately Canada: A review of 2020 emergency benefits for individuals

Canada Emergency Response Benefit (CERB)

CERB and the self-employed

Employment insurance program

Canada Recovery Sickness Benefit (CRSB)

Canada Recovery Caregiving Benefit (CRCB)

Mortgage payment deferral

I need financial help immediately Canada: A review of 2020 emergency benefits for businesses

Canada Emergency Wage Subsidy (CEWS)

Canada Emergency Business Account (CEBA) interest-free loans

Canada Emergency Commercial Rent Assistance Program (CERC)

Canada Emergency Rent Subsidy (CERS)

Lockdown Support

Loan Guarantee for Small and Medium-Sized Enterprises

Canada United Small Business Relief Fund

I need financial help immediately Canada: 2021 emergency measures for individuals and businesses

I need financial help immediately Canada – Individuals

I need financial help immediately Canada – Small Businesses

I need financial help immediately Canada summary

Consumer proposal versus bankruptcy introduction

Consumer proposal versus bankruptcy: Who qualifies for a consumer proposal?

Consumer proposal versus bankruptcy: What are consumer proposals?

Consumer proposal versus bankruptcy: Is a consumer proposal worth it?

What is the impact on my credit rating if I file a consumer proposal versus bankruptcy?

What are the costs and fees of a consumer proposal versus bankruptcy?

What happens to my assets in a consumer proposal versus bankruptcy?

What happens if I miss payments and default on my consumer proposal versus bankruptcy payments?

When is a meeting of creditors held in a consumer proposal?

Consumer proposal versus bankruptcy: How to file for bankruptcy?

Consumer proposal versus bankruptcy: Get back to a stress-free life

File bankruptcy in Canada online introduction

Can I file bankruptcy in Canada online?

How the coronavirus pandemic pushed bankruptcy online

Trustees already use an online bankruptcy filing system

File bankruptcy in Canada: The rest of the process is the same as before

File bankruptcy in Canada online: A word of warning

File bankruptcy in Canada summary

CERB requirements introduction

A CERB requirements refresher

The $5,000 CERB requirements problem

Are CERB requirements gross?

What is CRA now saying?

There is a simple fix, but, will the Federal Government use it?

CERB requirements summary

***Declaring bankruptcy in Canada*: Introduction**

***Declaring bankruptcy in Canada*: What debt does bankruptcy not cover?**

***Paying down debt*: Do you want an avalanche of snowballs?**

***I need financial help immediately Canada*: A review of 2020 emergency benefits for individuals**

***I need financial help immediately Canada*: A review of 2020 emergency benefits for businesses**

***I need financial help immediately Canada*: 2021 emergency measures for individuals and businesses**

***Consumer proposal versus bankruptcy*: Who qualifies for a consumer proposal?**

***Consumer proposal versus bankruptcy*: What are consumer proposals?**

***Consumer proposal versus bankruptcy*: Is a consumer proposal worth it?**

***Consumer proposal versus bankruptcy*: How to file for bankruptcy?**

***Consumer proposal versus bankruptcy*: Get back to a stress-free life**

***File bankruptcy in Canada*: The rest of the process is the same as before**

***Holiday spending*: Tale of two countries?**