Last week on February 14, 2011 the Superintendant of Bankruptcy (OSB) issued their monthly report on insolvencies in Canada.
While insolvencies are down 10.5 % in Canada as a whole over the last 12 months ending in November 2010, insolvencies are still 21.4% higher than the 12 months (Oct 2007 – Sept 2008) before the great recession started.
In Canada the total number of consumer bankruptcies has decreased by 19.5% during the 12 month period ending November 2010, while the total number of consumer proposals filed increased by 22.4% during the same 12 month period.
The increase in people filing consumer proposals could be that people are taking advantage of the changes that were made to the Bankruptcy & Insolvency Act and was implemented on September 18, 2009. These changes allowed for more flexibility for people to file consumer proposals.
A consumer proposal is a deal that you and your consumer proposal administrator negotiate with your creditors to pay a portion of your debt at a monthly rate that you can afford, it’s a great option If you want to avoid bankruptcy. Here is a quick example of how a consumer proposal works;
Say you have $50,000 in unsecured debt owed to various (credit cards, bank loans, lines of credit, payday loans, and income taxes). You are working and can afford to make some of your payments, but can’t afford to make all of your payments including interest. You contact us at Hoyes Michalos & Associates and we assist you in filing a consumer proposal to your creditors, you agree to pay $400 per month over the next 4 years for a total of $19,200. Your creditors have 45 days to vote on your consumer proposal and once they accept it you simply pay $400 per month for the next 4 years and after it’s paid the rest of your debts are gone.
So if you are struggling paying your debts every month and you want to avoid bankruptcy, why don’t you give us a call @ 310-PLAN and we can go over all of your options with you. You can also fill out our free online evaluation.
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