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MORTGAGES FOR SENIORS CANADA: APPARENTLY NOT A PROBLEM

mortgages for seniors canada

Mortgages for seniors Canada: Introduction

TransUnion Canada’s most recent TRANSUNION Q2 2018 INDUSTRY INSIGHTS REPORT found that borrowing for mortgages was reduced in Canada in 2018. A troubling statistic exists for mortgages for seniors Canada. In this Brandon’s Blog, I discuss this and certain other issues arising from the TransUnion Canada report.

Secured home loans for older folks Canada: Home mortgage borrowing decreases throughout Canada

Home mortgage lending has reduced throughout Canada in the first half of 2018. Generally, there was a 3.4% decline in the variety of brand-new home loans in Q1 2018 as compared to Q1 2017; this comes after an 8.8% year-over-year decrease in Q4 2017. This pattern seems to prove that the brand-new home loan guidelines might be affecting customers that are either not qualifying or are not able to obtain the level of home mortgage they want. It is unclear if this decrease in home mortgage demand means that there are fewer people looking for a home mortgage, or if there are more people sitting on the sidelines trying to figure out a way to qualify.

HELOCs for retirees Canada: Seniors bucking the trend

The exception to the decrease in home mortgage originations in Canada in 2018 is older generation Canadians. Canadians in the 73-93-year-old age group saw a substantial year-over-year boost (63%) in the number of home mortgages taken out. Baby Boomers in Canada, those in the 54-72-year-old age group saw an 18% increase. These statistics beg the question, why are Baby Boomers, and those in the Boomers’ parents’ age range, refinancing their mortgages or taking out new mortgages? Although not disclosed in the TransUnion Canada report, presumably a lot of the retirees are taking out reverse mortgages, as they too can’t qualify for a traditional mortgage on their retirement income.

Mortgages for seniors Canada: Seniors use of funds

The TransUnion report does not delve into the uses seniors are putting the new mortgage funds to. However, if I was to speculate, I would think that the funds were being used for:

Baby Boomers –

  1. Seniors debt consolidation
  2. Helping children pay for education.
  3. Giving or loaning their children sufficient funds for the house down payment so they could now qualify for a traditional home mortgage under the new stress test rules.

The 73-93-year-old age group –

  1. Helping children with paying off debts – Baby Boomer’s debt consolidation loans.
  2. .Their own debt consolidation.
  3. Gifts or loans to grandchildren – sufficient funds for the house down payment so they could now qualify for a traditional home mortgage under the new stress test rules.

Real estate loans for baby boomers Canada: Why I believe parents and grandparents are helping children buy their home

The TransUnion Canada report says that the greatest decreases in home mortgage applications were amongst the more youthful generations. There was a year-over-year decrease of greater than 22% amongst Gen Z as well as 19% amongst Millennials.

No doubt some of the decreases is a result of the younger generations’ changing lifestyle habits where homeownership may not be as important as it was to the generations before them. However, I would expect that Millennials as a group would by this point want home ownership, where Gen Z may not see it right now as being important.

Main mortgage changes by location

The biggest downturn in mortgage originations remained in Toronto, with a decrease of 17.6% in Q1 2018 from the previous year. Vancouver stayed reasonably level with an increase of only 0.8% over the previous year. The biggest increase in the home mortgage business was in Ottawa, with a boost of 8.4% over the previous year. Montreal had a 5.2% boost over the previous year.

Mortgages for seniors Canada: Risk distribution

Mortgage originations in the super prime risk tier increased 4.4% year over year in Q1 2018. All other risk tiers combined registered an 8% decrease in originations. TransUnion Canada reported that the decrease has been most significant in the below-prime risk buckets.

It is interesting that the higher risk subprime market mortgages have increased. No doubt private lenders, including the shadow lenders, dominate this market as the borrowers could not qualify for a home mortgage loan from a traditional bank or mortgage lender.

The decrease of new mortgages in the lower risk categories tells me that the new stress test qualifying rules combined with successive increases in mortgage rates have contributed negatively to those who perhaps as recently as last year could have qualified for a traditional mortgage. However, now they can’t be based on affordability.

Do you, your children or your grandchildren have too much debt?

Are your children or grandchildren coming to you for financial help for debt consolidation? Is going into debt the best option for you? Can you afford to carry your new debt in retirement? Is giving away your home equity through a reverse mortgage the right move? Will you need the money you are about to give away for your healthcare?

If debt consolidation is the reason why your children or grandchildren need your financial help, look at other options first. They need the help of a professional trustee. Call the Ira Smith Team. We will listen to your issues and provide you with our thoughts and recommendations for free. That’s right; a free initial consultation. So why not?

We will advise them whether or not we think they are a candidate for either a debt consolidation consumer proposal or bankruptcy. If we feel they can solve their financial problems without an insolvency process, we will tell them straight. Make sure that the money you give for debt consolidation will fix all of their problems. It is possible that with our help, you’ll need to provide just a fraction of what they are asking for.

The Ira Smith Team understands the stress they and you are under and the pain it is causing you and your loved ones. We can eliminate their pain. I guarantee that they and you will start feeling better right away after our free initial consultation. Taking action after that will put you on the right path, Starting Over Starting Now.what does a court appointed receiver do18

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WHAT DOES A COURT APPOINTED RECEIVER DO: REQUIRED CONDITIONS FOR RECEIVERSHIP REAL ESTATE SALE

Bankruptcy

What does a court appointed receiver do: Introduction

Earlier this week I wrote my blog COURT APPOINTED RECEIVER REAL ESTATE: ALL PURCHASE TERMS AREN’T EQUAL. In that blog, I described 5 common conditions that a buyer wants in a real estate agreement of purchase and sale. I also showed why a court appointed receiver cannot agree to those requested conditions. The purpose of today’s Brandon’s Blog is to answer the question what does a court appointed receiver do in setting the vendor’s conditions in a real estate sale.

What does a court appointed receiver do: The 5 most common vendor terms

In the earlier blog this week, I listed the 5 most common seller terms that the court appointed receiver cannot agree to. Here are the five most common terms that the court appointed receiver as seller requires.

  1. Capacity – The court appointed receiver requires the buyer to acknowledge that the vendor is selling solely in its court-appointed role.
  2. Title – Buyer agrees to accept title to the property as will be conveyed by the Court order conveying title which is called a Vesting Order. Also, the buyer must acknowledge that it is accepting title subject to any site plan agreements, restrictions, easements for the supply of utilities, services or otherwise. Also, the buyer will accept title subject to any rights of way, encroachments on or by the subject property onto adjoining properties, leases or licences. This is why it is important for the buyer’s lawyer to do a careful search of title and explain any and all issues to the buyer before the purchaser agrees to accept title.
  3. Inspections – A buyer from a court appointed receiver must be very careful in doing its due diligence. The court appointed receiver will allow for reasonable inspections. The buyer must acknowledge that he/she/it relies entirely upon its own inspection and investigation with respect to quantity, quality and value of the property. The buyer must also agree that it is purchasing and accepts the property on an “as is” basis, as of the date of acceptance and as of the closing date.
  4. Fixtures and chattels – Every buyer obviously wants to get the most possible out of the real estate purchase. It is normal for all buyers to want to confirm that they are receiving good title to all chattels and fixtures. The buyer is also looking for a warranty that they will all be in good working order on the date of closing. This is not possible in a court appointed receiver real estate sale. Rather, in a Court-appointed receivership, the receiver will insist on the condition that notwithstanding anything contained to the contrary in the agreement of purchase and sale, the Buyer acknowledges that the seller does not have title to the chattels or fixtures presently located on or used in connection with the property. The buyer and seller can agree that the chattels and fixtures set out in the schedule to the agreement remain at the property. However the buyer must also agree to take it on an “as is” basis. There is no warranty or representation and the seller won’t provide a bill of sale on closing for any chattels or fixtures. The court appointed receiver probably cannot verify that ownership of the fixtures and chattels are the property of the owner of the real estate. The receiver won’t rely on what is affixed to the premises to to prove or infer title.
  5. Court approval – A court appointed receiver must obtain court approval to the method of offering the property for sale (obtained before the sales process begins) and certainly for a specific sale. The court appointed receiver must seek that approval in order to have the sales process and sale sanctioned. The Court will issue an Approval and Vesting Order. This is the Court order allowing the transfer of title to the buyer. A court appointed receiver will put together its motion material and attend in Court for such approvals once it knows that it has a firm deal, all buyer conditions have been waived and the necessary deposit funds have been received. A Court will not approve a transaction that isn’t firm. The Court will question why the court appointed receiver is wasting resources in making the approval request at that time.

What does a court appointed receiver do: Is your mortgagor in trouble?

I hope this information will help you understand better the most common terms and conditions a court appointed receiver selling real estate requires. A court appointed receiver does this in setting the vendor’s conditions in a real estate sale.

Are you a mortgagor over industrial or commercial realty where the debtor remains in default? There may be reasons that you have to take into consideration for putting in a court appointed receiver.


If yes, call the Ira Smith Team. Our approach for each file is to create an end result where Starting Over, Starting Now takes place. This starts the minute you are in the door. You’re simply one phone call away from taking the necessary steps to get back to leading a healthy, balanced hassle-free life, recover your money and move on to the next investment opportunity.what does a court appointed receiver do

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COURT APPOINTED RECEIVER REAL ESTATE: ALL PURCHASE TERMS AREN’T EQUAL

court appointed receiver real estateCourt appointed receiver real estate: Introduction

Over the last 5 years, (and of course for many years before then), we have taken on many Court appointments for commercial real estate receivership files. In August 2017 we wrote BUYING REAL ESTATE FROM A RECEIVER: READ, REMEMBER AND FOLLOW THE CONTRACT LAW FINE PRINT. In that blog, we described a BC Court of Appeal decision to show how tricky both the sale and purchase of court appointed receiver real estate can be. For this Brandon’s Blog, I list certain purchaser terms normal in an arm’s length non-distress situation. I explain why they can’t always work when purchasing from a receiver.

Court appointed receiver real estate: 558 Dovercourt Road, Toronto

One of our current assignments is the sale of real property with a civic address of 558 Dovercourt Road, Toronto. This is a residential income property (with a commercial storage component). Given the potential for competing claims, the second mortgagee wanted to go the court appointed receiver route, rather than a traditional mortgagee power of sale. This is so the Court is available to sort out any issues of competing claims or other claims.

We have to date received two offers to purchase. Unfortunately, both offers weren’t acceptable. Our sign back of the first offer was not accepted by the potential purchaser. The second offer was not even worthy of a sign back.

It was not only an issue of price. The potential purchasers also included various terms that were unacceptable to any court appointed receiver. This is notwithstanding that they may be fine to a normal vendor.

Court appointed receiver real estate: Unacceptable terms

Below are some common terms that we see potential purchasers include in an offer. I give the reason(s) why a court appointed receiver cannot include them in an acceptable agreement of purchase and sale. Keep in mind that the court appointed receiver is not trying to be difficult or mean. Hopefully, these explanations will help.

  1. The seller – The seller is not just the court appointed receiver’s company name. Rather, the vendor is court appointed receiver’s company name, solely in its capacity as court appointed receiver of [legal name of property owner]. It is only the official court appointed receiver capacity selling the real estate. The court appointed receiver’s power to offer the property for sale and enter into an agreement as seller comes from the court appointment order. The Court also supervises the administration and sale.
  2. All equipment/appliances will be in good working order on closing – A court-appointed receiver cannot give such a warranty. A private receiver or a court-appointed receiver sells assets on an “as is where is” basis, with no warranties. It’s just the way it is.
  3. The court appointed receiver will obtain court approval for the sale before the purchaser has waived all of the purchaser’s conditions – A court appointed receiver can’t and won’t go to Court to obtain approval to a transaction that may not even exist later on because the purchaser won’t waive one or more conditions and the deal goes dead. The court appointed receiver won’t incur the cost of preparing its motion and going to Court before knowing there is a firm deal. This obviously includes the payment of the deposit funds.
  4. Seller will discharge work orders – A court appointed receiver will not do the repairs or upgrades to the property in order to discharge work orders. The court appointed receiver will, of course, give clear title to the property by discharging mortgages or liens. The Court approval Order, called a Vesting Order, does this. The purchaser has the time to have his/her/its lawyer inspect title. The deal ends if proper title can’t be given. If the purchaser does not want to inherit certain work orders, then that should be another condition.
  5. Seller will provide the buyer with keys that work to every exterior and interior door lock – A court appointed receiver will not agree to this. The court appointed receiver will certainly provide any keys in its possession.

These are the most common buyer conditions that a court-appointed receiver real estate sale won’t be able to handle. In my next blog, I will look at common conditions a court appointed receiver seller uses.

Court appointed receiver real estate: Is your mortgagor in trouble?

Are you a mortgagee over a commercial real estate property where the mortgagor is in default? Are there reasons why you need to consider applying to Court for a court appointed receiver + real estate sale?

If yes, contact the Ira Smith Team. Our philosophy for every person and company is to develop an outcome where Starting Over, Starting Now happens, beginning the minute you come in the door. You’re just one call away from taking the essential action steps to get back to leading a healthy and balanced stress-free life.

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DEBT RELIEF IN CANADA: BANKRUPTCY COURT SALUTES CANADIAN MILITARY VETERAN

automatic discharge

Debt relief in Canada: Introduction

I recently read a decision of the Bankruptcy Registrar of the Supreme Court of Nova Scotia in Bankruptcy and Insolvency that really inspired me. It got me thinking about the sacrifices our men and women in the military make for all Canadians. This particular Court decision, also made me think of sometimes they need our help for debt relief in Canada.

Debt relief in Canada: The case

The case I refer to is Durdle (re), 2018 NSSC 206, released August 31, 2018. The first two paragraphs of the Registrar’s decision, I found especially poignant:

“[1] This Court routinely considers situations in which the Bankrupt is indebted to the people of Canada, through tax or other liabilities to the State. As a matter of general policy, these obligations have a higher moral and sometimes legal priority than to private creditors as they are borne by all of us, as citizens and fellows of Society; and because the public generally must bear the share not paid by someone else. The collective public is an involuntary creditor in the result.

[2] What, then, is the situation when that is reversed – when it is the people of Canada who are indebted to the individual? Should compensation paid out as a consequence be considered divisible among creditors in an insolvency?”

Debt relief in Canada: The facts

Master Corporal Durdle was a career soldier. He spent 24 years in the military, retiring at the age of 45 years old. Master Corporal is now 49 years old and suffers from military service induced post-traumatic stress disorder (PTSD). He remains under professional care. He is in need of debt relief.

On November 13, 2013, Master Corporal Durdle filed an assignment in bankruptcy. This was his second bankruptcy and therefore, he was not entitled to an automatic discharge from bankruptcy. The purpose of the Court hearing was for the Court to consider what form of bankruptcy discharge he should be entitled to. In this second bankruptcy, there were minimal non-exempt assets and unsecured creditors totaling $73,476.76.

In 2014 while an undischarged bankrupt, Master Corporal Durdle received taxable income, including:

  1. $16,778 from a wage loss replacement plan;
  2. A rehiring allowance of $28,107.04, including $19,675 in severance pay;
  3. Pension income of $23,594.10;
  4. Disability income of $49,289; and
  5. $3,624 in employment income.

The decision the Court had to make was, as the guidelines existed in 2014, how much if any of this 2014 taxable income should be considered “surplus income”?ira smith bankruptcy trustee vaughan

Debt relief in Canada: The Court’s thinking

The Registrar made a point of saying:

“…I wish to be clear that nothing should be taken as putting military debtors on a different footing than a civilian. The rule of law, including that of civil contract, is one of the core values we hold as Canadians, and which is protected by our men and women in uniform. What is, however, on a different footing is the debt we owe those men And women when they are injured or ill in the discharge of those Duties.”

Debt relief in Canada: The Registrar’s analysis

The Registrar went through a very thoughtful analysis of the law. He considered it in connection with the various types of 2014 taxable income:

  1. Wage loss replacement plan – Wrongful termination awards would normally be included in total income, as would pay in lieu of notice. The Registrar, however, went on to comment that in this case, the wage loss replacement plan was not termination pay or pay in lieu of notice but rather, pay because Master Corporal Durdle’s PTSD prevented him to continue serving. The Registrar concluded that this amount should not be considered as income in accordance with Section 68 of the Bankruptcy and Insolvency Act (BIA). Therefore, the Registrar also concluded that this amount should not be included in the calculation of surplus income.
  1. Rehiring allowance – The Registrar applied the same logic for this payment. He decided that it should not be included in the calculation of surplus income. He decided that this payment was a result of Master Corporal Durdle’s PTSD preventing him from continuing to serve in the military.
  1. Pension income – The Registrar could not determine whether this income was solely a benefit due to Master Corporal Durdle’s PTSD or not. However, it did factor into the Registrar’s ruling.
  1. Disability income – The Registrar considered this income in light of previous Court decisions involving lump sum awards. This included under a Workers’ Compensation Plan. The Registrar went on to review the actual Federal statute under which the payment was made to him, the Veterans Well-being Act (S.C. 2005, c. 21). The Registrar concluded that this amount would not be included in the calculation of surplus income.
  1. Employment income – The Registrar concluded that this amount is included in the surplus income calculation.

Debt relief in Canada: The Court’s decision

The Registrar concluded that if he includes the pension income ($23,594.10) and of course the employment income ($3,624) (less statutory deductions), Accordingly, Master Corporal Durdle’s income falls under the Superintendent of Bankruptcy threshold for 2014. Accordingly, Master Corporal Durdle had no surplus income to pay when considering Section 68 of the BIA.

Since this was Master Corporal Durdle’s second bankruptcy, he was not entitled to an absolute discharge. Therefore, the Registrar did not impose any conditions on his discharge, but rather, suspended his discharge for one day.

Debt relief in Canada: Sometimes understanding and kindness is required

The Registrar was obviously moved by Master Corporal Durdle’s service to Canada. He also considered his current plight brought on by service-related PTSD. The Registrar followed the law and also showed his understanding and kindness of this sad situation.

If you have financial difficulties, whether brought on by a medical cause or for any other reason, you need to seek professional advice from a Firm that will show you the understanding and kindness you deserve. The Ira Smith Trustee Team has seen many cases of personal and corporate financial distress. We understand your pain and we know how to alleviate it; with understanding and kindness.

Our strategy for every single business and person is to develop a result where Starting Over, Starting Now comes true, starting the minute you walk through our door. You’re just one call away from taking the necessary actions to get your debt settlement and back on the road to leading a healthy and stress-free life. Contact the Ira Smith Team today.debt relief in canada

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AVERAGE CANADIAN NET WORTH 2018: MIDLIFE WEALTH SHOCK MAY LEAD TO DEATH

average canadian net worth 2018
average canadian net worth 2018

If you would prefer to listen to the audio version of this average Canadian net worth 2018 blog, please scroll down to the bottom and click on the podcast.

Average Canadian net worth 2018: Introduction

According to the most recent Statistics Canada report published in 2017. The Survey of Financial Security, the median net worth of Canadian families was $295,100. That is the latest federal government official statistic we have in determining the average Canadian net worth 2018.

There’s always been talk about how a financial crisis can adversely affect your health but now a new study published in the Journal of the American Medical Association suggests that wealth shock may actually shorten your life.

Average Canadian net worth 2018: What is wealth shock?

Researchers defined wealth shock as a loss of 75% or more in financial value over two years. The average loss was about $100,000. This catastrophic financial crisis could include a drop in the value of investments or realized losses like home foreclosure. The effect was more marked if the person lost a home as part of the wealth shock, and it was more pronounced for people with fewer assets.

Average Canadian net worth 2018: How does wealth shock affect your life expectancy?

Researchers analyzed 20 years of data from the Health and Retirement Study, which checks in every other year with a group of people in their 50s and 60s and keeps track of who dies.

  • Wealth shock was tied to a 50% greater risk of dying
  • Middle-aged Americans who experienced a sudden, large economic blow were more likely to die during the following years than those who didn’t
  • Women were more likely than men to have a wealth shock
  • Wealth shock crossed socio-economic lines, affecting people no matter how much money they had to startira smith bankruptcy trustee vaughan

Average Canadian net worth 2018: This is really a story about everybody

Although this study was conducted in the U.S., “This is really a story about everybody,” said lead researcher Lindsay Pool of Northwestern University’s medical school. “Stress, delays in health care, substance abuse and suicides may contribute”, she said. North or south of the border, we’re all in equal danger. According to Dr. Alan Garber of Harvard University in an accompanying editorial, the findings suggest a wealth shock is as dangerous as a new diagnosis of heart disease. He also noted that doctors need to recognize how money hardships may affect their patients.

Average Canadian net worth 2018: Don’t wait until you’re a wealth shock statistic

Please don’t wait until you’re a wealth shock statistic. If you’ve experienced wealth shock or are experiencing financial hardship, don’t jeopardize your health. Contact a professional today.

Ira Smith Trustee & Receiver Inc. is full-service insolvency and financial restructuring practise serving companies and individuals throughout the Greater Toronto Area (GTA) facing financial crisis or bankruptcy that need a plan for Starting Over, Starting Now.

We approach every file with the attitude that corporate or personal financial problems can be solved. That is as long as you take immediate action with the right plan. We’re just a phone call away and we can set you back on a path to financial health.

AVERAGE CANADIAN NET WORTH 2018
AVERAGE CANADIAN NET WORTH 2018
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SMALL BUSINESS LOANS CANADA CASE STUDY: LOSING YOUR MONEY IS NOT FUNNY

1st Global Capital

Small business loans Canada: Introduction

Today I am going to be telling you a story about a US corporate bankruptcy, and then a case study of our own. The purpose is to illustrate how you need to understand all the risk factors as a private small investor in making small business loans Canada.

Small business loans Canada: 1st Global Capital bankruptcy

A $283 million corporate US bankruptcy has derailed many retirement plans. It has left many investors in a financial crisis. In one case, a small inheritance was invested. In another, a cash award granted by a Court was invested. These are just two of the investor stories coming out of the US bankruptcy case of 1st Global Capital of Hallandale Beach, Florida.

1st Global Capital describes itself this way:

“1st Global Capital is an industry-leading direct funder with the professionalism, flexibility and fast turnaround you need to maximize your success. We use our years of industry experience, our funding power and our technological expertise to empower Independent Sales Organizations (ISOs) and Partner’s like you to maximize your business opportunities. Behind every 1GC deal is the expert vetting and oversight from our team of funding professionals with over 50 years of combined underwriting experience.”

Small business loans Canada: The “memorandums of indebtedness”

1st Global Capital was created 5 years ago to fund small companies. It funded loans to small businesses throughout many states in the USA. Examples of the types of businesses it funded are dining establishments, retail stores, construction businesses, healthcare, and e-commerce companies.

They raised money by issuing “memorandums of indebtedness” to people who invested with 1st Global Capital. Many used retirement savings accounts to fund their investment. 1st Global Capital used commissioned agents in many states to sell the 1st Global Capital investment opportunity. These short-term deals were supposed to pay back with interest at the end of nine months.

Small business loans Canada: The risky loan products

1st Global Capital was an alternative lender. It’s loan products included:

  • Merchant Cash Advances
  • Specialty Funding Options
  • Asset Based Lending
  • Accounts Receivable Funding

By its very nature, this was risky lending to businesses that could not obtain more traditional bank financing. The investors were wooed by promises of high returns, but I am certain they did not really understand they were making unsecured loans to a company that placed the money into risky loans.

Small business loans Canada: The small investors

Bankruptcy documents indicate greater than 4,000 1st Global Capital accounts existed across the country at the date of bankruptcy. Numerous are individual retirement accounts, each owed in between $621,000 and $922,000.

Court records indicate that 1st Global Capital stated that the cause of its bankruptcy was examinations by the Securities and Exchange Commission as well as the U.S. attorney’s office in southern Florida over alleged securities violations.

As a result, the inflow of money from investors stopped when 1st Global Capital could no longer offer its memorandums. The bankruptcy files show that as a result, the company dealt with an unexpected and intense liquidity situation. The regulatory agencies state that 1st Global Capital was selling securities and the company was subject to government registration with and oversight by government regulatory agencies.

The bankruptcy records do not indicate this but I am certain that eventually, the bankruptcy trustee will report that the investment scheme was a Ponzi scheme. If the inability to take in more loans caused the company’s bankruptcy, it is obvious that they required fresh money in order to honour their existing liabilities. New investors’ money paying back older investors is a classic definition of a Ponzi scheme.

Small business loans Canada: Our very own Canadian case study

Not understanding what you are investing in is not a story unique to the United States. Let me tell you about one of our case studies from last year called Vaughan Crossings Inc (“VCI”). We were appointed by the Court as Receiver of the assets, properties and undertaking of VCI. The main asset of VCI was 5.5 acres of owned development land located at the northwest corner of Dufferin and Centre Streets in the City of Vaughan, ON. In this receivership, our main role was to sell these lands. You can find all the Court records and public information on our webpage that we set up for VCI, so I won’t go through the history of the file in this Brandon’s Blog.

The important point in this file is that the second mortgagee was a group of investors. These investors were found through the use of commissioned agents. These agents were mainly financial advisors and insurance agents. The agents made commissions to raise funds from their clients for investment in this project. Just like in the 1st Global Capital case, the investors were mainly individuals, many of whom used funds in their RRSPs to make the loan.

Small business loans Canada: The dangers of not understanding risk

During the receivership, I had the chance to speak with many investors who called in wanting to know the status of their investments. These unsophisticated people were wooed by the promise of high returns when the project was fully built out. Just like in the 1st Global Capital case, the mortgage syndicator had to cease raising funds as they were being investigated by the Financial Services Commission of Ontario. Ultimately, the mortgage syndicator went into receivership also.

The money put in by this unsophisticated investor group was secured by way of a second mortgage. The developer ran out of cash to develop the property. The mortgage syndicator was shut down. The lands were not be developed. The plan was that the mortgage syndicator was going to do another round of financing to provide construction financing, which would be in priority to the second mortgagee! The mortgage syndicator had the authority, acting as trustee of the second mortgage, to subordinate that mortgage to the construction financing. However, that never happened.

Small business loans Canada: The receivership

Without construction financing, the development project could not continue; hence our appointment as Receiver. There two mortgages against the property and numerous construction liens filed and perfected against the property. We obtained our appraisals and ran a receivership sales process. We sold the property for much more than its appraised value. The sales price repaid the construction liens and the first mortgage. However, there was very little available for the second mortgagee investors.

The promise of a high-interest rate wooed these investors. They may not have been as focussed on the safety of their capital. Unfortunately, these small investors did not understand the risks associated with this type of loan they were making. Shame on their financial advisors who sold them this investment, knowing it was not right for most of them. The financial advisors were hungry for commissions, regardless of what harm may come to their clients.

Small business loans Canada: Is your business at risk?

If your small business is having financial problems, more small business loans alone is not the answer. You must first look at all aspects of your business. First, you should look at the viability of your business.

Are there expenses that need cutting and activities that you must do that can generate more revenue? If so, perhaps we can restructure your business. You may not need a long-term small business loan. Perhaps a short-term loan to get over the immediate financial hurdle you are facing is enough.

If you are looking for ways to restructure your corporate or personal debt call Ira Smith Trustee & Receiver Inc. We understand the stress and pain your financial problems are causing you. We feel your pain and we can end it for you.

Our strategy for every single business and person is to develop a result where Starting Over, Starting Now comes true, starting the minute you walk through our door. You’re just one call away from taking the necessary actions to get your debt settlement and back on the road to leading a healthy and stress-free life. Contact the Ira Smith Team today.small business loans canada

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6 CANADIAN PERSONAL FINANCE MOVES EVERY NEW GRAD SHOULD MAKE

canadian personal financeCanadian personal finance: Introduction

Congratulations Graduates! You’ve done it! And now, at long last, you’re working. Have you been out shopping for a new car? Maybe having a look at the condo market? My advice to you is to slow down. That is why I am providing my 6 Canadian personal finance moves every new grad should make.

As tempting as it is to be making some real money for the first time, finding ways to spend it isn’t as important as finding ways to save it.

Canadian personal finance: Finances 101 for recent grads in a first job

  1. Pay down debt first. This is one of the most important messages that we deliver, especially for high-interest rate debt. So, hold off on the spending sprees and pay off your debts.
  2. Establish a budget. “It is important to set a new budget based on your new income and stick to it”, says Jennifer Auld, a District Vice-President of TD, who suggests using one of the many financial apps available to help track your spending. “You can plug in all of your fixed costs and determine what’s left at the end, for you to spend”. “It’s a critical first step in terms of establishing how much you’re able to save each month and what your discretionary earnings look like.”
  3. Save! Save a portion of each paycheque, even if it isn’t a lot of money. It all adds up. You will establish a pattern of saving which will be a big help down the road.
  4. Take advantage of group RRSP plans with matching contributions at work. It’s free money and will help you save more money, faster.
  5. A tax-free savings account is a great option for someone making less than $50,000 a year. Especially people coming right out of school, according to Michael Allen, senior portfolio manager at Wealthsimple.
  6. Don’t make any drastic changes in lifestyle. Jennifer Auld of TD Canada Trust suggests continuing to live on a student budget for a couple of months while you make a plan, including establishing your short and long-term goals. “What that allows you to do is get comfortable with your new reality before you go out and start changing your lifestyle and changing the way you live day-to-day,” said Auld.

Canadian personal finance: What to do if you are deep in debt

If you’re a recent grad, or a not so recent grad, with a high debt load and getting deeper into debt, reach out to the Ira Smith Team. We help people deal with debt on a daily basis and there is a way out. You need a plan for Starting Over, Starting Now. Give us a call today and get on a path of debt free living.

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BANKRUPTCY TRUSTEE IN TORONTO: BANKRUPTCY TRUSTEE EXPLAINS POVERTY LINE

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Bankruptcy trustee in Toronto: Introduction

As a bankruptcy trustee in Toronto (now called a licensed insolvency trustee), I took great interest in reading a recent poverty line Canada study. A new research project whose results were announced in July 2018, studied poverty in Canada. It finds higher than 25% of respondents feel they have stress over financial matters. Not just a part-time stress; it is a full time feeling. Instead of just analyzing income levels, the survey considers the daily realities of making ends meet and how that can take a toll on people.

Many are unable to spend on simple things like going to the movie theatre, but also on more serious needs, like warm clothes for winter time and dental care. Some are late paying bills or cannot pay them at all and many say they can’t afford better quality food at the grocery store.

Bankruptcy trustee in Toronto: People are struggling

Researchers also found of the people who struggle most, 20% make well above what’s considered low income. However, the study finds that doesn’t always go far particularly in major urban cities. You can be making what many would consider middle-class earnings and still feel stressed. The survey showed many feel on the edge with their ability to have a life with some level of comfort or relaxation.

Bankruptcy trustee in Toronto: 4 major groups

This ARI research identified four groups:

  1. the struggling (16%);
  2. on the edge (11%);
  3. recently comfortable (36%); and
  4. always comfortable (37%).

As expected from these labels, the struggling is dealing with economic difficulties that are adversely influencing their lifestyle. Those on the edge are a stone’s throw behind them.

Bankruptcy trustee in Toronto: The study’s other main findings

The study’s other main findings are:

  • nearly a third (31%) really feel extremely worried about money regularly– either usually or constantly;
  • about half (52%) think hardship has actually been rising;
  • almost ten percent (9%) feel that financial hardship has been decreasing;
  • thirty percent (30%) are downhearted concerning their individual finances over the near future;
  • more think their youngsters’ finances will be worse (43%) compared to those who think their children will be financially better (32%);
  • all 4 state financial anxiety exists, yet there is more for both lower groups; and
  • the anxiety felt by the always comfortable group is a fret about future troubles as opposed to their present life.

Bankruptcy trustee in Toronto: Canada Without Poverty

Canada Without Poverty charitable organization states that roughly 5 million Canadians, or 1 in 7, live in poverty. However, the ARI study shows that the participants in the study estimate that about one third live in poverty. As you can see, their views were shaped by their own feelings of money anxiety.

Bankruptcy trustee in Toronto: Are you are “on the edge”?

Do you feel you are in the “on the edge” or the “recently comfortable” groups? Are you always feeling financially stressed? Are you worried that you may not be able to absorb an unexpected expense of $1,000 or more? If so, why not get a free financial checkup?

Seek professional help immediately. Ira Smith Trustee & Receiver Inc. is a full-service practice serving people just like you and companies throughout the Greater Toronto Area (GTA) who need a plan for Starting Over, Starting Now.

We know your pain and the stress you feel because of your finances. Our Firm has helped many others restructure their debt and return to a financially healthy life. Give us a call today. We can give you peace of mind and set you on a path to debt free living. We are a bankruptcy trustee in Toronto.

(43.807606, -79.534091)bankruptcy trustee in toronto

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CANADIAN CENTRE FOR POLICY ALTERNATIVES SAYS JOB AND ECONOMIC INSECURITY AFFECTING PROFESSIONALS

Canadian Centre for Policy AlternativesCanadian Centre for Policy Alternatives: Introduction

A survey released by the Canadian Centre for Policy Alternatives (CCPA) of one thousand Canadian professionals found that 20% are in precarious jobs. It’s not a surprise that job and economic insecurity is affecting professionals across the country when almost 50% of workers are living paycheque to paycheque (Canadian Payroll Association).

Canadian Centre for Policy Alternatives: Professionals are not immune

We often think that professionals armed with university degrees are immune from the economic woes that plague the rest of working Canadians. However, many professionals now find themselves in a new category of employment – precarious jobs.

A precarious job can be any type of work that is not permanent, has unpredictable income and doesn’t provide a retirement plan or sick days:

  • Freelance
  • Contract work
  • Part-time

Canadian Centre for Policy Alternatives: Survey results

If you think that highly educated professionals are not working in precarious jobs, think again. In today’s economy, the level of education and job security have nothing in common. According to the CCPA survey:

  • 58% of all professionals surveyed reported their job used to be more stable
  • 22% of professionals across Canada are now working in precarious jobs
  • 60% of precarious professionals are women
  • 60% of precarious workers don’t have pension plans or sick days
  • 50% of precarious workers report that their incomes vary significantly
  • 30% of workers in precarious jobs have a post-graduate degree
  • Ageism in the workplace. The highest percentage of precarious professionals fall in the 55+ category. As well, those with 10+ years in their profession are also on edge.
  • Professionals in precarious careers are twice as likely as those in a secure job to make less than $60,000 a year

It’s very difficult for precarious workers to plan ahead and get ahead. With an unstable income, it can be challenging to meet monthly expenses, let alone save for retirement. Many precarious workers are living off credit in between jobs just to stay above water, accumulating massive amounts of high-interest debt. After the credit cards have hit their limit, in desperation some resort to payday loans and a never-ending cycle of debt.

Canadian Centre for Policy Alternatives: Precarious jobs leads to financial stress

If you’re having trouble meeting your monthly expenses I urge you to seek professional help. Accumulating debt is not the answer to your problems. Make a no cost, no obligation appointment with Ira Smith Trustee & Receiver Inc. We’ll review your file and bring value added solutions that fit your unique issues and circumstances. Contact us today and Starting Over, Starting Now you’ll be able to put your financial woes behind you.

 

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DEBT SETTLEMENT VS CONSUMER PROPOSAL CANADA: ENGLISH REALITY STAR NEEDS IT

Debt settlement vs consumer proposal Canada: Introduction

This debt settlement vs consumer proposal Canada Brandon’s Blog is to tell you a story how a once very rich person can run into debt troubles. If you want specific information about the difference between debt settlement and consumer proposal, read our blog “DEBT SETTLEMENT OR CONSUMER PROPOSAL CANADA: NEW CANADIAN GOVERNMENT REPORT EXPOSES DEBT SETTLEMENT COMPANIES HARMING CONSUMERS” published May 3, 2017. You may also wish to read our blog “FAMOUS CELEBRITY BANKRUPTCIES HAPPEN TOO”. Katie Price certainly fits into that crowd.

To find out more about how a consumer proposal works, you can also use the search function in our Brandon’s Blog site for any of the following phrases:

  • is consumer proposal worth it
  • consumer proposals faq
  • disadvantages of consumer proposal
  • consumer proposal vs credit counselling
  • how much does a consumer proposal cost
  • consumer proposal pros and cons
  • what happens after a consumer proposal

This will bring up more of our blogs on this topic.

Debt settlement vs consumer proposal Canada: The Katie Price Story

English former beauty model, reality TV star, and businesswoman, Katie Price, was a self-made success that had scooped ₤45 million after years of brilliant business transactions and plain old hard work. Unfortunately, the former glamour model will not have the ability to delight in the fruits of her work. It is said Katie is on the brink of bankruptcy having spent all her fortune.

Debt settlement vs consumer proposal Canada: Working for a pair of “knickers”

Things seem to be so bad the for the reality TV star mom. She once was paid for a social media post with one pair of slacks. Her ₤2 million Sussex estate has fallen under a state of disrepair. The swimming pool is dirty, yards are thick with growth and the tennis courts are abandoned. Katie, 40, has additionally begun marketing her horses and llamas. The ₤77,000 Audi she purchased for separated hubby Kieran Hayler for his 30th birthday celebration is also for sale.

The modelling jobs have dried up and last month she even admitted staging lewd images in Thailand with toyboy Kris Boyson. She was spotted mowing her own lawn amid claims she’s started laying off staff to stay in the black.

Debt settlement vs consumer proposal Canada: How Katie Price spent her money

Taking to Instagram, she also admitted the bailiffs had visited her house to demand £3,000 for an electricity bill. But what has the mother-of-five spent all her money on? On top of that, she’s said to have spent £120,000 on housekeepers, gardeners, and nannies – one of whom Kieran claimed to have had a year-long affair with.

Katie Price was also visited by bailiffs demanding the £3,000 she failed to pay an electrician. Her monthly heating bill apparently comes to £2,000 because she keeps it on 24-7, and her other monthly outgoings include £1,500 for twice-weekly manicures and pedicures, £1,000 on getting her hair done, £800 on massages every other day, £800 on a makeup artist, £400.

And that’s not to mention the apparent £60,000 a year she’s forking out on farm machinery such as a tractor and milking machine. She also spends on a £25,000 annual cosmetic budget.

Last Christmas she confessed ₤2,000 spent on decorations. She feared it may be her terminally ill mother Amy’s last one.

Debt settlement vs consumer proposal Canada: How Katie Price is now earning money

And while back then she generated millions from her scents, publications, reality TV show as well as x-rated shoots, nowadays her only source of work seems to be her program, My Crazy Life Now. She is determined to make back some money. Katie claimed to be intending to revive her beauty version alter ego Jordan. She also plans a release of a variety of sex playthings.

One source was quoted as saying “Katie told me when all else fails sex sells”. “It’s the way she’s taking things – she’s bringing back Jordan to fix her finances. She said that it was a no-brainer to go back to her old image.”

Debt settlement vs consumer proposal Canada: Are you in need of debt settlement?

If you’re thinking about debt settlement or a consumer proposal or are looking for ways to end your financial debt call Ira Smith Trustee & Receiver Inc. We understand the stress and pain your financial problems are causing you. We feel your pain and we can end it for you.

Our strategy for every single person is to develop a result we’re Starting Over, Starting Now comes true, starting the minute you walk through our door. You’re just one call away from taking the necessary actions to get you your debt settlement and back on the road to leading a healthy and stress-free life.debt settlement vs consumer proposal canada

Call a Trustee Now!