Tag: personal bankruptcy

Categories
Brandon Blog Post

#VIDEO – HOW MUCH DO YOU HAVE TO OWE TO FILE BANKRUPTCY?#

HOW MUCH DO YOU HAVE TO OWE TO FILE BANKRUPTCY –

NOT MUCH!

We are always asked, how much do you have to owe to file bankruptcy? The real question is, here are my assets and my debts, what are my options? In Canada, the Bankruptcy and Insolvency Act (Canada) (“BIA”) states that you must owe at least $1,000 of unsecured debt to file for bankruptcy. The same holds true if someone owes you money. They must owe you at least $1,000 on an unsecured basis to apply to the Court to make an Order judging a person or company into bankruptcy. As you can see, the threshold is not very high.

HOW MUCH DO YOU HAVE TO OWE TO FILE BANKRUPTCY –

ARE YOU INSOLVENT?

Facing serious financial difficulties is devastating, especially if you believe that personal bankruptcy is your only option. In fact many people mistakenly believe that dire financial problems automatically mean personal bankruptcy. If you are having problems meeting your financial obligations or have stopped meeting those financial obligations as they come due you are actually insolvent, not bankrupt. Insolvent is a financial condition; bankruptcy is a legal state.

Bаnkruрtсу is a legal рrосеѕѕ under the BIA that helps you to resolve уоur debts if they have become unmanageable. If you have relatively few assets and low іnсоmе and dесіdе to file for bаnkruрtсу, you will probably fіlе under the shortened Summary Administration part of the BIA. If you have realizable assets that will produce a value greater than $10,000, then your bankruptcy would be administered under the general administration provisions. Don’t worry about these distinctions now. For now, just know that the streamlined summary administration rules is a simpler process, and the Superintendent of Bankruptcy sets the cost of the bankruptcy administration.

HOW MUCH DO YOU HAVE TO OWE TO FILE BANKRUPTCY –

THE BANKRUPTCY PROCESS

In either case, you will turn over to your Licensed Insolvency Trustee (“LIT”) all of уоur рrореrtу that is not exempt (protected) by law. The LIT will sell your property and the proceeds used to рау for the bankruptcy administration and then to distribute to уоur сrеdіtоrѕ.

If you have very little property, all of it might be рrоtесtеd so that you will not lose it. How much уоur сrеdіtоrѕ will get in this process dереndѕ on how much уоur unрrоtесtеd property sells fоr and whether you must pay “surplus income” to your LIT.

The last step of your bankruptcy process, will be to get your discharge from your debts, meaning that you will not have to рау them all (with certain exceptions).

HOW MUCH DO YOU HAVE TO OWE TO FILE BANKRUPTCY –

SEE A TRUSTEE EVEN IF YOU DO NOT WANT TO GO BANKRUPT!

People think that they should only see a LIT if they need to file for bankruptcy. Every LIT will give you a free 1 hour consultation, to go over your situation and offer you your available options. The topics the LIT will discuss with you are:

As you can see, bankruptcy is only one of many topics discussed, in determining what your options are, allowing you to choose the one that makes the most sense to you. No other professional can discuss this full range of topics with you, and especially not for free!

WHAT SHOULD YOU DO IF YOU OR YOUR COMPANY HAS TOO MUCH DEBT?

If you’re dealing with serious financial issues, contact a trustee, who is the Canadian bankruptcy expert. For the reasons already given, you should do this whether or not you’re contemplating bankruptcy. The reason is very simple: the licensed insolvency trustee will assess your situation, offer you all of your available options and will do this for you for free! You can’t find a better deal anywhere.

We’re not only bankruptcy experts; we’re experts in dealing with debt. Contact Ira Smith Trustee & Receiver Inc. today for a free consultation and you will be well on your way to regaining your former quality of life Starting Over, Starting Now.

THIS VLOG WAS INSPIRED IN PART BY OUR eBOOK – PERSONAL BANKRUPTCY CANADA: Not because you are a dummy, because you need to get your life back on track

hoyes, david sklar, a farber, Alexis Neely,Eyes Wide Open Life, Ali Shanti, Financial Liberation, bankruptcy, bankruptcy blog series, bankruptcy blog, bankruptcy Q&A, Q&A, how much in debt to file bankruptcy, how much do you have to owe to file bankruptcy, how much to file bankruptcy, do I have enough debt to file bankruptcy, ira smith trustee, how much do you have to owe to file bankruptcy, what happens if i file bankruptcy and still owe money for child support?, queens bankruptcy attorney, queens bankruptcy help, queens legal help, matthew benson, matt benson, attorney at law, f lee bailey

Categories
Brandon Blog Post

GREY DIVORCE: BABY BOOMERS ARE SPLITTING UP

Grey divorce is a growing trend

Some are calling it grey divorce. Baby boomers divorcing after many years of marriage. People think they will be married forever but many times, it isn’t meant to be. People have their families, and increasingly, they then find after decades of marriage that they just can’t relate to each other anymore. Ultimately, they have to accept things are as they are not as they wish them to be.

We have previously written on this topic:

The trend is not stopping

Since 1990 the divorce rate has doubled for couples over age 50 and researchers found after age 40 its often the wife who wants the divorce. People are no longer willing to compromise to live in unhappy circumstances. Longevity is a key factor. We are all living longer, and spending four or more decades with the same person is becoming more difficult.

Nowadays, people in their forties and fifties and sixties feel very youthful and if you’re in a marriage that your needs aren’t being met, we have choices. Financial independence is more prevalent among seniors and baby boomers put an emphasis on individual happiness. Should you live unhappily or as roommates under the same roof?

It can be financially complicated

Financial advisors caution that splitting up later can be complicated. Timing is critically important because people that are in their late fifties or early sixties may have planned for retirement to be right around the corner, and the financial ramifications of your marriage ending in your senior years may substantially alter those plans for both spouses.

According to the Investors Group:

  • 80% of those people who divorced at the age of 50 or older say they will delay retirement because they need to work longer than planned
  • 62% say their post-breakup savings and investments will no longer be adequate to fund their retirement
  • 54% of those who divorced at or past the age of 50 found it difficult to make financial decisions surrounding their splitting up
  • 53% had to adjust their retirement plans
  • 47% will have to scale back on their anticipated retirement lifestyle
  • 26% no longer have enough retirement savings

What should you do if your life is financially complicated?

If you are experiencing financial problems, instead of going deeper into debt and just putting your head in the sand like an ostrich, contact us today. Seek the help from a professional trustee, even if you’re not considering bankruptcy at this stage.

A licensed insolvency trustee will evaluate your situation and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counseling, debt consolidation or a consumer proposal or even bankruptcy. With immediate action and the right plan, the Ira Smith Team can solve your financial problems Starting Over, Starting Now. We’re just a phone call away.

This vlog was inspired by our eBook – PERSONAL BANKRUPTCY CANADA: Not Because You Are A Dummy, Because You Need To Get Your Life Back On Track

 

grey divorce

Categories
Brandon Blog Post

STUDENT LOANS DEBT: WILL BANKRUPTCY ELIMINATE IT IF YOU ARE NOT THE STUDENT?

student loans, student loan, student loan debt, ira smith trustee, amazon.ca, starting over starting now, licensed insolvency trustee, bankruptcy, bankruptcy alternatives, credit counselling, consumer proposals, debt consolidation, Bankruptcy and Insolvency Act, BIA, student loans, debt, debts, personal bankruptcy, declare personal bankruptcy, student debt, student debt bankruptcy, Bankruptcy Reform Act, Bankruptcy Code, Code, toronto bankruptcy, vaughan bankruptcy, bankruptcy toronto, bankruptcy vaughan, consumer proposal toronto, consumer proposal vaughan, vaughan consumer proposal, toronto consumer proposal, personal bankruptcy vaughan, personal bankruptcy toronto, toronto personal bankruptcy, vaughan personal bankruptcy, ccaa, corporate bankruptcy;

An interesting American case about student loans debt

Student loans debt is nearly impossible to get rid of in bankruptcy. A case winding its way through the US court system has piqued our intellectual interest. A father, who is a discharged bankrupt, is taking the lender who HE borrowed funds from for his child’s education to Court. The lender is continuing to pursue collection efforts against the father on the basis that the provisions of the Bankruptcy Reform Act of 1978, as amended, codified in Title 11 of the United States Code and commonly called the “Bankruptcy Code” (“Code”), does not release the father from what is in reality student loans debt. The father is taking the lender to Court for a ruling that by virtue of his discharge, he is released from that debt like all his other debts. It has raised the question whether the same student loans debt rules should apply in that case.

The Canadian perspective

We are not qualified to express any opinion on the US legal case before the US Court, but we are qualified to discuss the issue from the Canadian perspective. We started thinking whether this same situation could arise in Canada for student loans.

Last week we discussed student debt bankruptcy from the perspective of the student. Previously, we have written blogs and created a vlog about student loan debt, including:

So this week, we’re discussing student loan debt and bankruptcy from a very different and interesting angle. Could a Canadian lender take the position against a Canadian parent borrower who on the loan application described the purpose of the loans for the funding of his or her child’s Canadian post-secondary education, that the loans qualify as student loans under the applicable Canadian statutes, including, the Bankruptcy and Insolvency Act (Canada) (BIA). Stated otherwise, are such loans the same as student loans under Canadian law and can bankruptcy cut such loans if you’re not the student?

Are student loans necessary?

Many young Canadians need student loans to get a post-secondary education. To qualify as Canadian student loan debt, the loans must be issued under a specific Canadian student loan statute: the (i) Canada Student Loans Act; (ii) Canada Student Financial Assistance Act; (iii) Apprentice Loans Act; or (iv) any enactment of a province that provides for loans or guarantees of loans to students.

All students need financial help to be full-time university students. The only real places that such assistance can come from is either the parents, if they are willing and able to do so, student loans, or both. Many Canadian parents pay a hefty part of students’ tuition fees, even if it means sacrificing their financial stability, to help their children avoid a post-graduation life burdened by tens of thousands of dollars of student debt. Others may wish to, but they cannot afford to do so.

So are student loans and the resultant debt necessary? In most cases, yes.

Can a parent co-sign for or guarantee their child’s student loans?

The short answer is no. As I have already stated, to qualify as a student loan, the loan has to be made under the provisions of one of the Federal loan statutes mentioned above, or any such similar Provincial legislation. Nowhere in those student loans statutes is there a place for either a guarantor or cosigner. In fact, the Federal statutes all have similar language stating that upon the death of the borrower, the Federal government will repay the outstanding part of the loan. In addition to there not being any sections that allow for a guarantor or cosigner, the specific section dealing with the death of the borrower does not limit the government’s guarantee by using words like “….and if the lender is unable to collect in full from any guarantor or cosigner”. The reason is simple, student loans cannot be guaranteed or otherwise borrowed by anyone other than the student.

Will bankruptcy eliminate student loans debt?

Student loans are nearly impossible to get rid of in bankruptcy. Section 178(1) of the BIA states:

“(g) any debt or obligation in respect of a loan made under the Canada Student Loans Act, the Canada Student Financial Assistance Act or any enactment of a province that provides for loans or guarantees of loans to students where the date of bankruptcy of the bankrupt occurred:

(i) before the date on which the bankrupt ceased to be a full- or part-time student, as the case may be, under the applicable Act or enactment, or

(ii) within seven years after the date on which the bankrupt ceased to be a full- or part-time student;

(g.1) any debt or obligation in respect of a loan made under the Apprentice Loans Act where the date of bankruptcy of the bankrupt occurred

(i) before the date on which the bankrupt ceased, under that Act, to be an eligible apprentice within the meaning of that Act, or

(ii) within seven years after the date on which the bankrupt ceased to be an eligible apprentice;”

So if you’re a student, bankruptcy will only end student loans if you’ve ceased to be a full or part-time student for more than seven years and either declare personal bankruptcy or make a debt proposal to your creditors, most likely through a consumer proposal. The only other option is to attempt to seek from the Court relief because of undue hardship, but this is very difficult, if not impossible.

What is required to meet the burden of undue hardship?

If the Court is satisfied that you meet the two-pronged test, you’ll be discharged from your student loans obligations in bankruptcy only if the :

  • acted in good faith in connection with your obligation to repay your student loan debt; and (emphasis added)
  • have experienced, and will continue to experience, financial difficulty that will prevent you from repaying this debt

It’s then up to the bankruptcy court to decide whether they forgive your loans, either in full or in part. One of the difficulties in trying to prove undue hardship is that there is no clear definition for what makes up hardship; each bankruptcy court across Canada may use a slightly different interpretation. The only thing that’s clear is that you must prove that having to continue to pay the student loans after bankruptcy would be a financial hardship for you. If you try this route, the Court will look at ALL of your income and expenses.

The Court may decide you are not trying hard enough, or, may look at things like your small car you use to get to work, which you purchased used (instead of taking public transit), your cell phone and your internet expenses, and decide that these are luxuries you do not need. If you are a smoker, the Court may very well decide that if you were not addicted to tobacco, you could start to repay some part of your student loans.

If you think my examples are picayune or silly, just look up the case of Fournier (Re), 2009 CanLII 31606 (ON SC).

Will bankruptcy eliminate student loan debt if you are not the student?

I don’t know what the eventual disposition of the US case which I mentioned at the beginning of this blog will be, but based on all the above, in my view in the Canadian context, a parent, relative or friend cannot guarantee, cosign or borrow for a loan that qualifies as a Canadian student loan. If you borrow to fund your child’s education, then you are borrowing under an ordinary commercial transaction and the applicable student loan sections of the BIA do not apply.

So if you have borrowed for this purpose, only the normal provisions of the BIA apply, and you will get a discharge from that and your other debts upon your discharge from bankruptcy. However, if you pledged any of your assets in support of such borrowings, such as your home, the lender does have the right to enforce its security against such assets if you cannot repay, whether you are bankrupt or not.

What should you do if you have too much debt?

If you’re drowning because of your finances, we know we can help you. Although many people believe that bankruptcy is the only way of out serious debt, that’s not always the case. Ira Smith Trustee & Receiver Inc.can discuss other bankruptcy alternatives with you which include credit counselling, debt consolidation and consumer proposals.

If we get to see you early enough, at the first sign of trouble, you can use and carry out one of the bankruptcy alternatives, to free you from the burden of your financial challenges to go on to be a productive, contributing member of society and not be plagued by debt problems.

Bankruptcy law is very complicated and requires the expertise of a professional licensed insolvency trustee. Ira Smith Trustee & Receiver Inc. is here to help. With a cumulative 50+ years of experience dealing with diverse issues and complex files, we can get you back on your feet Starting Over, Starting Now. We can help. Call us today.


People consider us bankruptcy experts because we wrote the eBook which is sold on Amazon.ca, explaining the Canadian personal insolvency and bankruptcy system, specifically directed to the person stressed out with too much debt.

 

Categories
Brandon Blog Post

CREDIT REPAIR TORONTO: HOW TO USE IT TO NOT RUIN YOUR LIFE

Credit Repair Toronto: Why Not?

Many people think it’s best to try a credit repair Toronto company before they investigate the Canadian insolvency process. I’m here to tell you that many of these companies are not acting in your best interest.

What do Dave Ramsey and Gail Vaz-Oxlade have to say?

Many are paid – and in some cases managed – by credit card companies. According to an article by financial guru Dave Ramsey:

“Some of these ‘counselling’ companies withhold credit card payments until the account is three to six months past due. Then, they contact the lender and negotiate to settle the bad debt…That’s how they get negotiated discounts on credit card debt. Card companies don’t settle on your debts when your payments are on time. These services are always a bad idea, and sometimes they’re a complete scam.”

Dave Ramsey isn’t the only one leery of credit repair Toronto companies. Gail Vaz-Oxlade writes:

“One of the big drawbacks of using a debt counselling or debt management company is that they don’t come with any serious advice, so people often fulfill their commitment and then go right back out and rack up their debt again.”

Does the Ontario government like credit repair Toronto companies?

The provincial governments have their own opinion. Most provinces have enacted legislation to try to thwart many of their shady practices. Stay away from credit repair Toronto companies. Do not be afraid to go to a Licensed Insolvency Trustee for a free consultation at the first sign of financial trouble. (See the picture at the bottom of this page for a special offer).

We have previously written blogs on the credit repair Toronto industry who have been preying on consumers for far too long. We’ve warned you about them in previous blogs:

In 2010, after a decade of massive growth in the U.S. debt settlement industry, the FTC brought in new regulations that effectively banned debt settlement companies and forced many of them to migrate north of the border. This resulted in 18 companies and 34 credit counselling providers offering debt settlement services in Ontario.

With ever-mounting numbers of complaints about unsuspecting consumers being taken advantage of by unscrupulous credit repair companies, the Ontario government has finally taken action and passed Bill 55.

What will Bill 55 do? It creates new standards of conduct for credit repair Toronto companies by:

  • Banning them from charging upfront fees
  • Limiting the number of fees consumers are charged and prohibiting the payment of fees before services are provided
  • Requiring clear, transparent, and detailed contracts that include information about the effect of the contract on the consumer’s credit rating
  • Requiring credit counsellors to disclose information to the consumer about how the organization is funded
  • Establishing a 0-day cooling-off period, providing consumers more time to consider their agreements with companies
  • Allowing the licenses of non-compliant companies to be revoked

If not credit repair Toronto companies, then what should YOU do?

Please stay away from credit repair Toronto companies! Rather, obtain a free consultation from a licensed insolvency trustee to understand the options available to you either as an alternative to bankruptcy or of bankruptcy itself. We are professionals, federally regulated, licensed and subject to a strict code of ethics. Our fees are regulated by the Federal Government and are usually much less than credit repair companies who make unsubstantiated claims. We can help; Starting Over, Starting Now you can live a debt-free life.

We have been able to help many individuals carry out a successful debt settlement program. It all began with debt counselling. The first step is a realistic household budget.
Successful completion of such a program will free you from the burden of your financial challenges to go on to live a productive, stress-free, financially sound life.

Call us today so you can get on the road to financial recovery immediately.

The first part of this vlog is from our newly released book:

Toronto,Vaughan,credit repair toronto,credit fix toronto,credit counseling toronto,tips on how to repair bad credit,canada credit fix reviews,how to improve your credit score canada,credit repair loans canada,canada credit fix inc toronto on,credit repair,credit repair how to,how to improve credit score,how to repair your credit,fix credit score,credit repair lawyers,credit repair letters,sample credit repair letters,fast credit repair,debt,ira smith trustee, personal bankruptcy toronto, bankruptcy, consumer proposal, toronto, vaughanI said above that there would be a special offer and here it is. If you would like to receive a complimentary, totally free copy of our eBook, please sign up as a subscriber to our blog. You can do so by filling in the subscription pop-up box on this page. If you are already a subscriber, thank you, and just shoot me an email asking for your complimentary copy.

If the subscription box on this page has gone away, you can click on the picture of our eBook in this article which will take you to our main blog page, and you should soon see the pop-up subscription box again. As a side bonus, you will also receive notice of all of our new blogs and vlogs, with a link directly to them.

Early next week,you will receive an email with an invitation to download a complimentary copy of our new eBook – PERSONAL BANKRUPTCY CANADA: Not Because You Are A Dummy, Because You Need To Get Your Life Back On Track.

Categories
Brandon Blog Post

Gambling and Consumer Proposals Ontario: 6 Differences With Bankruptcy

Gambling and Consumer Proposals Ontario: Introduction

Gambling and Consumer Proposals Ontario are treated very differently than in a Bankruptcy in Ontario. One of the most common questions that people in difficult financial situations ask is: what’s the difference between a consumer proposal and bankruptcy?

Personal bankruptcies and consumer proposals are two of the most common solutions available for personal financial issues. While both are designed to help people resolve debt issues and give users the necessary protection from creditors, learning what’s the difference between a consumer proposal and bankruptcy can help people make more informed decisions in the future.

  1. Gambling and Consumer Proposals Ontario: Consumer Proposal debt limitation

With a consumer proposal, it is only possible for you to claim it if your total debt does not exceed $250,000, excluding the debt owing on the mortgage(s) on your home. Additionally, you must be able to repay a part of those debts to apply.

  1. Gambling and Consumer Proposals Ontario: Creditor acceptance

However, your creditors must accept your proposal, as you do not automatically earn it upon signing up for the option. With bankruptcy, however, any person who owes their creditors more than $1,000 in debt is eligible to file without the need for creditor approval.

The ideal candidates for this situation are those who need some type of immediate financial relief and whose income and budget do not allow them to pay off the reduced amount agreed to in a consumer proposal, on a monthly basis, up to a maximum of 60 months.

  1. Gambling and Consumer Proposals Ontario: Fixed consumer proposal monthly payment vs. potential variable surplus income bankruptcy payment

In order to resolve the financial issues, you and your creditors need to agree to a proposed amount with a consumer proposal, hence the name of the program. This is a monthly amount that you need to pay consistently, but it stays the same for as long as the proposal is in effect. With bankruptcy, however, monthly payments may vary based on the amount of money that you make. The more that you regularly earn, the more you need to pay per month.

  1. Gambling and Consumer Proposals Ontario: Surrendering of your assets in a bankruptcy

With a consumer proposal, you do not need to surrender your assets. With bankruptcy, however, with only certain minor exceptions, you will have to surrender your assets to your licensed insolvency trustee. The Trustee sells them and will use the money to pay for the cost of administration. The Trustee might also pay a dividend to your unsecured creditors.

  1. Gambling and Consumer Proposals Ontario: Credit rating

With a consumer proposal, your credit rating will receive an R7. This indicates you have undergone such an agreement. It will remain for up to 3 years after paying off your loans. With bankruptcy, you earn an R9 rating. That is the worst that you can have. It can stay on your report for a period of 7 years.

  1. Gambling and Consumer Proposals Ontario: Debts from an addiction

The Bankruptcy and Insolvency Act and the Superintendent of Bankruptcy, are very concerned about debts that have arisen as a result of addiction. The Licensed Insolvency Trustee must ask questions to decide if any debts have arisen as a result of addiction.

Once so determined, in a bankruptcy, the licensed insolvency trustee must oppose the bankrupt’s discharge. In order to hope to get an absolute discharge from the Court, the bankrupt will have to go into a rehabilitation program. They will need to prove they have completed a recognized program and continue to seek help. The person will also need to show they are no longer spending money on such addiction.

These are all good things for the total rehabilitation of the individual. It differs from the treatment under a consumer proposal. The licensed insolvency trustee will still want to make sure that the individual is seeking help for their addiction. If you complete your consumer proposal payments there will never be a bankruptcy. Your consumer proposal is successfully completed. You also avoid the onerous issues of discharge from bankruptcy. The treatment of gambling and consumer proposals Ontario as compared to bankruptcy is huge for the individual.

Gambling and Consumer Proposals Ontario
Gambling and Consumer Proposals Ontario

Gambling and Consumer Proposals Ontario: Are you suffering from too much debt?

If you are an individual or company who needs to free themselves from the stress and strain of too much debt, and especially if you have been told your situation is hopeless because of an addiction, Ira Smith Trustee & Receiver Inc. can prepare and carry out the plan made just for you, to free you from the burden of your financial challenges to go on to live a productive, stress-free, financially sound life.

If you’re experiencing serious debt issues for any reason, contact a professional trustee for a free, no-obligation consultation. The Ira Smith Team does not try to write new insolvency laws or tax laws. Rather, we will evaluate your situation within the existing statutes, and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counselling, debt consolidation or a consumer proposal or bankruptcy. Starting Over, Starting Now you can be debt-free with the help of a professional, licensed insolvency trustee. Contact us today.

gambling and consumer proposals Ontario, what’s the difference between a consumer proposal and bankruptcy, consumer proposal, debt, debts, creditors, financial relief, surplus income, credit rating. Bankruptcy and Insolvency Act, Superintendent of Bankruptcy, gambling, alcoholism, drugs, addiction, bankruptcy, licensed insolvency trustee, debt issues, ira smith trustee, debt talk, financial advice, credit counselling, bankruptcy, credit (industry), personal bankruptcy, insolvency, mnp ltd.,
gambling and consumer proposals Ontario
Categories
Brandon Blog Post

#VIDEO: DOES SURPLUS INCOME IN BANKRUPTCY SOMETIMES MAKE YOU FEEL STUPID?#

If you don’t know what surplus income in bankruptcy is don’t feel that you aren’t as smart as the next person because most people don’t know what it means or how it is even possible. We hope this short video will explain things easier for you.

We have previously written about surplus income in bankruptcy in our blogs:

On the list of items that generally seems to be difficult for many individuals to understand is how there can be surplus income in bankruptcy. The reason for the confusion is because it has nothing to do with the normal usage of the word “surplus”, being “more than what is needed or used; excess”.

What is surplus income in bankruptcy?

Within a personal bankruptcy, the context is a measure of what a bankrupt has to pay to the Trustee month-to-month. It is one of the aims of the Canadian bankruptcy system to balance the discharge of one’s personal debt with the expectation of the creditors that they should be paid.

To allow Canadians to keep a basic standard of living during the personal bankruptcy procedure, the government features collection thresholds on income (after income tax as well as certain deductions) meant to enable the bankrupt to keep a basic standard of living while contributing an amount to the Trustee for the benefit of his or her creditors.

Exactly how is the surplus income in bankruptcy payment determined?

The surplus income payment is determined according to a prescribed surplus income calculation mandated by the federal government, without any distinction for the area somebody lives in. To learn exactly what your surplus income in bankruptcy obligation would be, if any, you need to speak to a Trustee.

Surplus income in bankruptcy thresholds are structured based on national “poverty line” stats and the thresholds are set regardless of what part of the country or city that you live in. Surplus income in bankruptcy has nothing to do with what you have left over in funds every month. It is a federal solution which takes your monthly after-tax wages or salary, allows for a specific number of non-discretionary expenses, and takes into account your family size. Your Trustee then inputs this information into the government mandated formula, to calculate your surplus income in bankruptcy obligation.

If you have too much debt, contact us

If you are an individual or company who needs to free themselves from the stress and strain of too much debt, and especially if you have been told your situation is hopeless, Ira Smith Trustee & Receiver Inc. can prepare and carry out the plan made just for you, to free you from the burden of your financial challenges to go on to live a productive, stress-free, financially sound life.

If you’re experiencing serious debt issues with the CRA, or for any reason, contact a professional trustee for a free, no obligation consultation. The Ira Smith Team does not try to write new insolvency law or tax law. Rather, we will evaluate your situation within the existing statutes, and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counselling, debt consolidation or a consumer proposal. Starting Over, Starting Now you can be debt free with the help of a professional, licensed trustee in bankruptcy. Contact us today.

surplus income in bankruptcy, ira smith trustee, starting over starting now, debt, consumer proposal, bankruptcy, credit counselling, debt consolidation, bankruptcy alternative, surplus income payment, surplus income calculation

Categories
Brandon Blog Post

# VIDEO – DIFFERENCE BETWEEN CONSUMER PROPOSAL AND BANKRUPTCY: LIST OF 5 DIFFERENCES TO KNOW ABOUT #

Difference between consumer proposal and bankruptcy

This short video explains the difference between a consumer proposal and bankruptcy. A consumer proposal is a deal to end your debts. A consumer proposal is a legally binding process that is administered by a licensed trustee.

5 things that make the difference between consumer proposal and bankruptcy

  1. In a bankruptcy, if your income goes up, the amount you have to pay to your Trustee may very well go up. In a consumer proposal, your payment is fixed.
  2. In a bankruptcy, you will lose your income tax refund, contributions to your RRSP in the last 12 months, RESP for your children and other assets. In a consumer proposal that is accepted by your creditors, you get to keep your assets.
  3. There is less reporting in a consumer proposal. You do not have to show proof of your income every month as long as you are keeping your consumer proposal payments current.
  4. In a bankruptcy, if there is opposition to your discharge from bankruptcy, then you must attend for a Court hearing.There is no Court process at the end of the administration or a discharge hearing in a consumer proposal.
  5. You stay in control of your assets and affairs in a consumer proposal that is accepted by your creditors and that you are performing.

These are the main things that create a difference between consumer proposal and bankruptcy.

If you have too much debt, call us now!

We offer personal bankruptcy and consumer proposal services, as well as corporate restructuring and corporate receivership and bankruptcy services to residents of the Greater Toronto Area. We explain the differences between a consumer proposal vs. personal bankruptcy. In most cases we can get a consumer proposal done and it usually results in a substantial reduction in the amount you have to repay. The amount you are required to pay when you file a consumer proposal depends on a number of factors as explained in this short video.

So now that you know the 5 major items that makes up the difference between consumer proposal and bankruptcy and if you are experiencing financial problems, or you know that you are insolvent and are considering a consumer proposal vs. personal bankruptcy, or looking at all of your realistic options, including all alternatives to bankruptcy, contact Ira Smith Trustee & Receiver Inc. Ira Smith Trustee & Receiver Inc. is a Vaughan (Toronto) bankruptcy trustee and consumer proposal administrator. We offer sound advice, a free consultation and a solid plan for Starting Over, Starting Now so that you’ll be well on your way to a debt free life in no time.

difference between consumer proposal and bankruptcy

 

Categories
Brandon Blog Post

#VIDEO – CONSUMER PROPOSAL FAQS: SECRETS FOR FENDING OFF BANKRUPTCY #

Consumer proposal faqs

We have made this video to answer the Consumer Proposal FAQs that we are normally asked. This information will hopefully help you understand better how it can help you clear your debts and AVOID bankruptcy.

In addition to this video, you can also check out other blogs and vlogs we have written on Proposals:

The most asked FAQs

The most asked of the FAQs is – What are the advantages? The main ones are:

  • You keep all of your assets
  • Actions against you by unsecured creditors, such as wage garnishments will be stopped
  • Unlike informal debt settlement, the proposal process is a forum where all of your creditors must deal with your restructuring
  • You don’t have to declare bankruptcy

Too much debt? Get the help you need now!

We hope you enjoy this video about consumer proposal FAQs. Click on this link to find out more. You can also have many of your questions about personal bankruptcy answered by clicking on our Bankruptcy FAQs link.

Instead of going deeper into debt and just putting your head in the sand like an ostrich, heed the advice of your grey divorce support groups and contact us today. Seek the help from a professional trustee, even if you’re not considering bankruptcy at this stage.

A trustee in bankruptcy will evaluate your situation and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counselling, debt consolidation or a consumer proposal or bankruptcy. With immediate action and the right plan, the Ira Smith Team can solve your financial problems Starting Over, Starting Now. We’re just a phone call away.

consumer proposal faqs

Categories
Brandon Blog Post

ADVANTAGES OF CONSUMER PROPOSALS VIDEO FOR YOU

Introduction

We have written many blogs on the advantages of consumer proposals, including:

We thought it would be good to now put together a short video on the topic.

The best alternative to personal bankruptcy in Canada

Of the various alternatives to bankruptcy, this government approved debt settlement plan is the one option with the most predictable and certain results for the insolvent person in dealing with their debt. You may have heard a proposal being called other names such as consumer credit proposal, debt proposal or debt settlement.

The main difference is that the only formal legal mechanism to be able to stop your creditors from continuing to harass and sue you is with a formal consumer proposal through a licensed trustee in bankruptcy. Unlike the other options, the consumer proposal is codified in the Canadian Bankruptcy and Insolvency Act which provides the trustee with certain weapons that can be used for your protection.

That is why we say that of all the bankruptcy alternatives, the consumer proposal is the best one. There are many bankruptcy options, but the consumer proposal also allows you to rebuild your credit thereby increasing your credit score.

Keep away from bankruptcy with the advantages of consumer proposals

If you are insolvent and are considering bankruptcy, contact Ira Smith Trustee & Receiver Inc. We offer sound advice, will check all of your bankruptcy options with you and then with you, formulate a solid plan for Starting Over, Starting Now so that you’ll be well on your way to a debt-free life in no time.

advantages of consumer proposals

Categories
Brandon Blog Post

CONSUMER PROPOSAL VS DEBT SETTLEMENT

consumer proposal vs debt settlement
consumer proposal vs debt settlement

Consumer proposal vs debt settlement vs. debt settlement companies

If you have serious financial problems, there is an option available to you to avoid debt settlement companies and bankruptcy. In fact, more Canadians are now choosing consumer proposals instead of declaring personal bankruptcy. The purpose of this Brandon’s Blog is to explain the benefit of consumer proposal vs. debt settlement companies.

The advantages of consumer proposals with a Trustee can save you from debt settlement companies. Here’s how. Unlike a trustee in bankruptcy, debt settlement
companies have long been a hot-button issue and as a result, we’ve posted several blogs on the subject:

How successful is consumer proposal vs. debt settlement companies?

One of the advantages of consumer proposals vs. debt settlement companies is a high chance of success. Consumer proposals filed by a trustee have an excellent chance of being accepted by creditors. The consumer proposals our office files have experienced almost 100% acceptance by creditors. We know of other trustees who say their success rate with consumer proposals is in the high 90% range.

According to the Canadian Bankers Association, only 10% of offers received from debt settlement companies are accepted and it’s estimated that only 3% are successfully completed. As you can see, consumer proposals vs. debt settlement win hands down!

Advantages of using a licensed trustee in a consumer proposal vs debt settlement company

The reason for the advantages of consumer proposals is because a licensed trustee understands the behaviour of your creditors, is obligated to check all options with you and explain why a consumer proposal is a better option than other ones available, including personal bankruptcy. A trustee can recommend you properly on how to reach a mutually satisfactory compromise on your debt that you can actually complete it successfully, taking your family income and situation into consideration.

If you are considering consumer proposal vs. debt settlement companies

The advantages of consumer proposal vs. debt settlement companies are simple; a trained, educated, licensed financial services professional delivers results. Contact Ira Smith Trustee & Receiver Inc. for sound, professional advice and a solid financial plan for Starting Over, Starting Now.

Call a Trustee Now!