Bankruptcy isn’t really talked about much in casual conversation since it isn’t a light subject by any means. You’re probably not going to approach your coworkers any time soon and ask them if anyone has ever declared bankruptcy. The truth in the numbers, however, shows that bankruptcy affects between 130,00 to 150,000 Canadians a year. Debt and lack of debt management leads to the bankruptcy rates in Canada and recent trends show that debt is going up among the population.

Debt can be managed, but if you’re struggling to make payments, don’t know how much debt you actually have, hiding debt from family and friends, using cash advances, paying off loans with other loans, or simply can’t make minimum payments, then it’s time to accept your debt situation is unhealthy. Bankruptcy might feel like the only option, but a consultation with a licensed insolvency trustee at David Sklar & Associates will tell you that there are financial options instead of bankruptcy and that there is hope.

What Can You Do?

When you’re struggling with the money you owe then you have to be willing to put your trust into a trustee. Bankruptcy is a major step and it might seem like what you have to do out of desperation, but a Licensed Insolvency Trustee(also known as a bankruptcy trustee) can help you navigate your options and come up with the best solution for you and your creditors.

Working with a Licensed Insolvency Trustee

To partner with a bankruptcy trustee and get the most informed and helpful solution to your debt problems, it’s important to be completely honest. You must:

  • Tell your trustee about all of your debt
  • Tell your trustee about all that you own
  • Be honest about your living situation (income, how many in the house)
  • Tell your trustee about all of your income

You also cannot make last-minute efforts to minimize the damage by suddenly transferring ownership of things you own or maxing out your lines of credit right before seeking help. If you’re considering any of this, stop right away and call the licensed insolvency trustees at David Sklar & Associates and they can help you come up with a plan to pay your creditors.

Consumer Proposals

The federal government created consumer proposals as an alternative for individuals who would otherwise declare bankruptcy. There are many rules and regulations to consumer proposals based on your assets, region, and type of debt, but typically if your debt is less than $250,000 (not including the mortgage of your principal residence) then a consumer proposal might be the best way to protect your assets.

A consumer proposal is an agreement between you and your creditors administered by a Licensed Insolvency Trustee) to pay back a reduced amount of your debt. It can stop interest from building on your credit and put a stop to collection calls and wage garnishment. You must be able to make regular monthly payments to your creditors so you should have a steady income. When things feel bleak, bankruptcy might seem like the only option but a consumer proposal might just be the solution you need to get out of debt and get back on track.