Solve debt trouble
Kids, job, health, elderly parents, addictions… anything can become the unexpected speed bump that throws your budget out of balance.
When the bills are growing faster than your budget, it does not take long before you feel that debt rules.
Goldhar helps you get out of debt fast.
There are two ways to legally stop creditors cold:
- Proposal (Consumer or Division 1)
Only a licensed insolvency trustee (LIT) can help you exercise either of these options. That’s where Goldhar & Associates comes in.
As soon as Goldhar & Associates files your proposal or bankruptcy, all creditor action to collect on unsecured debts halts immediately, including wage or bank account garnishments, collection calls and harassment from creditors or collection agencies, sheriff executions, suspension of essential utilities, and other collection actions.
Goldhar then works with you to present your creditors with an offer to settle your unsecured debts for a fraction of the amounts owed. This permits you to erase your debts through one affordable monthly payment over a period of time.
What is a consumer proposal and how does it work?
A consumer proposal allows you to reduce and settle your unsecured debts – including what you owe to the Canada Revenue Agency – for an affordable amount, to be repaid in one manageable monthly payment to the trustee for up to 60 months. You retain control of your assets, and the amount you need to pay to your creditors does not change if you get a better job, receive property or cash as a gift or an inheritance, or win the lottery.
The amount of your settlement offer to your creditors must be more than would be realized in a bankruptcy. And you must be able to demonstrate that you can meet that monthly payment without fail. Usually that means having a steady income.
As soon as your proposal is filed by a trustee, the legal protection kicks in and all garnishments, executions, and legal actions by creditors are stopped, and public utilities may not discontinue service for non-payment. Interest on your balances owed also is immediately stopped.
Only a licensed insolvency trustee (LIT) can prepare and file your consumer proposal.
Goldhar prepares your consumer proposal based on what you demonstrate you can afford to pay, presents it to your creditors on your behalf in a meeting that you attend, and assists in negotiations until there is an agreement between you and the creditors on the amount you propose to pay.
Once the proposal is accepted by your creditors, Goldhar administers the fulfillment (meaning the payout) of your proposal until it is paid off in full. You have the option of paying your proposal out over whatever time-frame you proposed to your creditors, or you may pay off the balance in full at any earlier time you choose. In the event that your proposal is not accepted by creditors, you may choose to file an assignment in bankruptcy, make a fresh proposal to your creditors, or seek a solution that does not require insolvency proceedings.
Advantages of a consumer proposal
- you retain control of your assets
- your obligation is limited to payment of the settlement amount as accepted by your creditors
- you can pay off the remainder of your proposal at any time you choose
- for unsecured debts (including any type of arrears to the Canada Revenue Agency) totalling $250,000 or less.
- Other proposal and insolvency options exist if debts are over $250,000, or if the debts are those of an incorporated business. Goldhar can help you explore these options.
When is bankruptcy the best way to shed the debt® ?
Determining whether bankruptcy is the best way for you to shed the debt is not something you can decide alone. It’s best to work with a licensed insolvency professional like Goldhar to review your entire financial situation. As a licensed insolvency trustee, Goldhar is qualified to review your financial situation and advise you on the debt relief options best suited to your situation.
Heavy debt loads do not always mean you’re bankrupt.
You are eligible to file for bankruptcy only if you are truly insolvent to the point that the total of all your unsecured debts exceeds the combined value of all your assets. Your cash flow may not be enough on a month to month basis to keep up with the cost of servicing your debts. However, if the equity built up in your home, or the value of your unincorporated business, or the tools and equipment you use to run your business, or other personal effects such as artwork, jewellery, or valuable collections, add up to more than the sum of your unsecured debts, technically you are not bankrupt. In this situation, a consumer proposal may be a more suitable option.
Goldhar will help you assess if bankruptcy is the most desirable way, or the only way, for you to realistically discharge your debts.
If you are truly unable to pay your bills and make debt payments when they are due, and you cannot afford to make an offer to your creditors through a consumer proposal or Division 1 proposal, or your proposal has been rejected by your creditors, bankruptcy may be the only remaining option to discharge your debts.
Bankruptcy is a significant financial decision, with consequences that will affect your credit rating, and may limit your ability to qualify for credit cards, loans and mortgages. However, when your debt load consumes all your cash flow, and it is apparent that you are unlikely to ever pay off your debts, bankruptcy is a responsible way to clear away your debt and make a fresh financial start.
There is no shame in filing for bankruptcy. No one needs to know. Your family and friends, your employer and your co-workers will only see your smile – a smile that comes from knowing your finances are in balance and you’re back on track to build a solid financial future.
To make an assignment in bankruptcy, you work with Goldhar to determine what assets you have that can be liquidated as payment to your creditors, and how much of your income you will be required for monthly payments to your creditors during the months until you are discharged. Many people who file for bankruptcy have no assets to be liquidated, and make little or no monthly payments to creditors.
Once you make your assignment in bankruptcy, all garnishments, executions, and legal actions by creditors are stopped.
In a first time bankruptcy, you will most likely be discharged in 9 months or 21 months, depending on the total of your debts. In second or third bankruptcies, the time before discharge will be longer.
Will you lose your home in a bankruptcy?
In most cases your family home is not required to be sold to pay your creditors. Your equity in your home, however, is considered an asset and you may be required to seek financing equal to the equity and then pay this amount to the creditors. Alternatively, Goldhar may be able to accept payout of the equity amount over time. In the event that only one spouse(or homeowner) goes bankrupt, Goldhar will, in most cases, permit the other spouse or homeowner(s) to buy out the bankrupt’s equity share.
- the amount of your settlement is determined by the Trustee based upon the value of your assets and your income
- you are required to fulfill certain obligations to the Trustee, including a monthly reporting of your income and expenditures
- if you have income in excess of the thresholds set by the Superintendent of Bankruptcy, up to 50% of your deemed “surplus” is payable to the Trustee until you are discharged from bankruptcy
- items such as household furniture, clothing and your personal effects are exempt in most cases
- typically you may keep a car/vehicle, the savings in an RRSP (less any contributions made in the last 12 months), your personal computer, and cellphone, etc.
- the debts of a sole proprietorship business would be included in your personal bankruptcy
- the debts of an incorporated business will be addressed if/when the corporation files a Division 1 proposal or bankruptcy
- directors of a corporation may be assessed personally for the corporation’s tax arrears related to HST and to the employee portions for CPP/EI and income tax deductions at source.
- you may not hold the position of Director of a corporation while you are personally an undischarged bankrupt.
Call Goldhar today to arrange a free, confidential financial review.
After reviewing your personal financial situation, Goldhar will discuss the opportunities available to help you shed the debt®
and come back to life. Call 1-855-541-5114 or fast dial #debt (#3328).