Making the decision to file for bankruptcy is
never an easy one for anyone involved. Often the persons involved will make
every effort to repay their creditors, with bankruptcy being their last option.
If you are considering filing for bankruptcy and debt consolidation this page
from Pickering bankruptcy trustee James R. Yanch has information that can help
you in the process.
In Canada, as an alternative to
bankruptcy a person can write a consumer proposal, it is a negation between
themselves and their creditors. If the consumer proposal is agreed on the debtor
would bake monthly payments to their creditors, up to a maximum of 5 years. The
creditors have up to 45 days to decide if they will accept the proposal, often
they will as it is a way that they will get more of their money back, instead of
when the person files for bankruptcy.
There are some benefits and
drawback when deciding whether to file for personal bankruptcy. In the plus
side, it is a very quick and effective way to protect you from wage garnishes,
collection agencies and legal proceedings. It is first most a way to get rid of
some unsecured debt. On the negative side, you may have to relinquish some of
your possessions when the bankruptcy is completed, in other words it is unlikely
that you will be able to keep all that you have. One of the biggest negatives is
that it resets your credit history to zero, so applying for a loan or a credit
card may not be possible for a long time. There is a lot of
paperwork involved, with you being required to file monthly statements of your
income and expenses. You are often required to make payments from your income
which will depend on your family size.
A good trustee can help you
better understand the laws where you are living. There are certain circumstances
which will allow you to keep the house that you live in and the car that you
drive. There are also specific laws regarding the keeping of your retirement
investments as well as declaring bankruptcy on your student loans. It is not a
decision to be taken lightly, however if you have decided that it may be the
best course for you and your family, make sure you understand all the logistics
before you proceed, as this decision will affect you and your money for numerous
years to come. Make sure it is the right one.
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