Over-indebtedness is driving many people to risky behavior in hopes of improving their situation. Whether it’s borrowing from private lenders or an overcrowded credit card, quick fixes are never real and that’s why it’s essential to turn to realistic recovery methods that have proven themselves.
So for the people of Sherbrooke and the Estrie region, we present you the real options that are available to you if you are among a large number of Warren struggling with money problems. You will soon notice that your situation is more common than you think and that sometimes simple solutions exist. Speaking of simple solutions, let’s talk a little about debt relief and settlement, would you?
Quick debt relief and settlement
Stop praying for a quick fix and regain control of your finances! You have just seen several realistic and often very beneficial ways of settling your debts quickly!
That’s why we offer you to use https://paydayloan-consolidation.com/ here to be put in touch with a debt expert who can listen to your needs. We will recommend the right professional help according to your situation.
Debt consolidation, good and bad!
Consolidate your debts means borrowing money from a financial institution to settle all or only part of your debts. Consolidation can take the form of a loan or a line of credit from which you will deduct an amount by repaying the terms and conditions.
This is a very simple solution that has the advantage of saving you a lot of money. Indeed, the consolidation loan is granted at a rate lower than that of your existing debts, you save money with each monthly payment. This is, of course, conditional on you being approved by the bank and getting a loan at a lower rate than your debts!
How does the bank determine your eligibility? This one analyzes:
-The total amount of your debts.
-The stability of your job and the amount of your income.
-Your credit report
However, debt consolidation does not reduce the total amount of debt to be repaid. Since the bank will pay the debt for you, you will have to repay it yourself. The real benefit of consolidation is that you save money by stopping paying exaggerated interest rates!
However, there are some notorious disadvantages that should be mentioned that could affect your decision to consolidate or not your debts, for example:
-The consolidation does not reduce the total debt
-The process of obtaining a loan can generate costs
-It is the bank that decides who is eligible for a loan according to sometimes demanding criteria
-The debts on a real estate mortgage are not included in a consolidation loan
However, if you are able to overcome these hurdles, this method of financial recovery will simplify the management of your finances and avoid resorting to a consumer proposal or even bankruptcy.
Bankruptcy, is it the end of the world?
From the outset, it is important to say no! Although it presents itself as an undesirable avenue, bankruptcy is also a way to put an end to a dead-end financial situation. The idea of declaring bankruptcy is that your creditors lose their right to exercise recourse against you (including seizing your assets), since your seizable assets will fall into the hands of the insolvent trustee. Your creditors will now have to contact him to obtain their payment, which will be done according to the order of creditors established by law.
This means that by putting all of your seizable property in the hands of the trustee, you are released from what is known as “releasable” debts, that is, debts that you will not have to repay. But what debts fall into this category and what debts are qualified as non-releasable?
The complete list of non-transferable debts is provided for in sections 178 et seq. Of the Bankruptcy and Insolvency Act and lists the receivables that are not affected by the fact that you are declaring bankruptcy.
-The debts related to the payment of alimony.
– Fines for an offense, which includes contraventions of the Highway Safety Code.
-Some other debts related to fraud or misrepresentation.
Releasable debts include the most common debts – credit cards and lines of credit, personal loans and overdue bills. Briefly, the Liberal debts are those that are not provided for in section 178 of the Bankruptcy and Insolvency Act. You will not have to repay them once you are out of bankruptcy.
As mentioned, bankruptcy involves the seizure of your “seizable property”. If this is an option that you seriously consider, it would be important to know which of your belongings will lift the markers when the time comes and which ones will stay in place!
-The furniture of the house that is used for the normal use of the occupants. However, the law provides for a maximum value of $ 7,000.
-The essential goods for the exercise of your profession or profession.
– RRSPs (but not in all cases).
-Alimony paid for the benefit of the children.
Are seizable all property that is not necessary to support you or your families, such as luxury items, equipment for recreational activity and even your motor vehicles if they are not essential to the accomplishment of your work.
For some other property, such as RRSPs and your property (if you own a home), you need to discuss with a trustee in bankruptcy the various possibilities as to their fate.
In addition, the bankruptcy process begins and ends with the intervention of an authorized insolvency trustee who undertakes the steps and files the necessary documents with the Superintendent of Bankruptcy.
Consumer proposal, a way to avoid bankruptcy?
In overindebtedness situations, the Bankruptcy and Insolvency Act can really be your friend! Indeed, it is this law that provides for the consumer proposal as a solution to get you out of debt! Moreover, this option entails the same suspension of procedures as the bankruptcy, so finished the calls of collection agencies!
The proposal boils down to offering creditors only a percentage of the debt you owe them. They will have the opportunity to vote for or against the acceptance of your proposal and will even be entitled to demand a meeting where you must be present!
What motivates the acceptance of a consumer proposal is the adverse impact of personal bankruptcy on your creditors. When the contest between them begins, the secured creditors seize all they can and leave only the crumbs to the ordinary creditors.
But under what conditions can I make a consumer proposal?
The main requirement is to have less than $ 250,000 in total debt. This does not include the mortgage on your house, however. The repayment period must also not exceed 5 years.
How to know if the proposal has been accepted?
If the creditors do not require a meeting, the proposal is presumed to have been accepted under the law. However, in the event that a meeting is required, a vote in favor of acceptance requiring a majority is necessary. On the other hand, each creditor does not have a vote of the same value; those to whom you have greater debt have a stronger voice when voting!
In addition, it is possible that a consumer proposal will be rejected on the first try! That does not mean, however, that bankruptcy will fall on you automatically, on the contrary. It is possible to submit a new consumer proposal to your creditors by modulating the submitted offer.
The beauty of the consumer proposal is that unlike debt consolidation, it has the effect of erasing part of your total amount to be repaid!