Division I Proposal: A formal procedure available to individuals and businesses. A debtor works with a trustee in bankruptcy to offer to pay your creditors a percentage of what you owe them over a period of time, extend the time you have to pay off the debt or a combination of these options. There is no limit with respect to how much money is owed-this differs from Consumer Proposal. Consumer Proposals are only available to individuals and do not exceed $250 000. It is important to note here that you retain all of your assets with both Division I and Consumer proposals.
First Steps:
1. Contact a trustee in bankruptcy
2. The trustee files the proposal and you stop making payments to your creditors
3. Creditors then vote to accept or reject the proposal. Rejection means bankruptcy only in a Division I Proposal.
Contact Rumanek & Company Ltd. for more information on bankruptcy and debt solutions. Or please fill out the free bankruptcy evaluation form. To learn more please visit our YouTube Channel. Rumanek & Company have been helping individuals and families overcome debt for more than 25 years.
When Nick opened his first business he did not realize that he could get a small business loan from the bank. Instead he applied for and received a personal loan, and used his personal credit cards, to fund the start-up. Unfortunately, the business was not successful, and now he owes $70,000, all in his name. Collection letters became daily phone calls, and the threats were getting worse, and no offer of monthly payments would satisfy them. Nick’s wife is afraid that if he files for bankruptcy, they will lose their home, which is finally showing some equity, and that they will not be able to leave the country to visit her family overseas. Nick saw no other alternative..
After many sleepless nights Nick and his wife came to see us. We explained that their house was not in jeopardy, and that out-of-country travel is not restricted by bankruptcy. Fortunately, Nick and his wife were frugal, and their combined income was enough that bankruptcy could be avoided. We helped Nick propose a settlement to his creditors to repay less than half of what he owed, interest-free, over five years. Nick was surprised that there was an alternative to bankruptcy that allowed him to satisfy his creditors. He completed his payments two years early and is now debt-free.
Contact Rumanek & Company Ltd. for more information on bankruptcy and debt solutions. Or please fill out the free bankruptcy evaluation form. To learn more please visit our YouTube Channel. Rumanek & Company have been helping individuals and families overcome debt for more than 25 years.
There is much information that people hear concerning bankruptcy, some of it good, some bad. This article will focus on the bad bankruptcy information.
Bankruptcy clears your credit rating
No it does not. Both Equifax and Trans Union of Canada keep a record of your bankruptcy for six (6) years. The six (6) years starts at the end of your bankruptcy. A first time bankrupt with no surplus income or other problems will take nine (9) months to be completed. Once your bankruptcy is over
(i.e. – after 9 months), you must be pro active in rebuilding your credit score. If you do nothing, than nothing will happen.
You can never get credit again
This might have been true 30 years ago but it is certainly not true today. With proper guidance from your trustee at either of the two (2) counselling sessions that take place during the bankruptcy, there is no reason why you should not be able to get credit within a few months after being discharged from your bankruptcy.
Nobody will give me a loan
Banks and financial institutions are in business to make money. They seem to make a lot of money. They can only make money by loaning money to buy a car or house, special loans for education or medical or other personal needs. And yes, also for credit cards, which are really a short-term loan at an interest rate from 18% to 29%. The banks need to loan out money almost as much as you need to borrow it. The key is for you to give them the information that will result in the bank approving your loan.
Bankruptcy will affect your job
As long as you are not in a job that requires you to be bonded or requires a high security clearance, bankruptcy will have no effect on your employment. Most employers (e.g. banks for bank tellers) will simply transfer you to a non-cash function while you are bankrupt. Once you are discharged from bankruptcy and back on your feet, you should meet with Human Resources about getting your old position back. I have not heard of any loss of seniority or reduction in income in this situation. Your trustee will not notify your employer that you are bankrupt unless requested to do so to stop a payroll garnishee.
Bankruptcy will affect your relationship with family and friends
Never has, never will. There is no stigma about filing an assignment in bankruptcy. It is a practical business matter that you have to deal with when you are over your head in debt and need to make a fresh start in your life. As part of the bankruptcy process, you must turn in your credit cards and re-establish your credit and get new credit cards. You will also be given information on budgeting and finance by your trustee. This is all being done to improve your financial health. Your relationship with other people can only improve.
If you are not sure, discuss your concerns with your Trustee.
Contact Rumanek & Company Ltd. for more information. Or please fill out the form on the contact us page for additional information. Or if you would like a free evaluation please fill out the FRRE Evaluation Form.
To learn more please visit our YouTube Channel. Rumanek & Company have been helping individuals and families overcome debt for more than 25 years.
If you are overwhelmed by debt you must stop the stress before it affects your health. Debt problems will often result in lack of sleep, fights with your spouse, poor job performance at work all of which contribute to your stress level. When the collection companies phone and you are afraid to answer the phone or open your mail, your blood pressure will rise and this also contributes to your stress. Before all of this causes health problems like depression please call a professional to help you. When you file a Consumer Proposal, an Assignment in Bankruptcy or other Debt Consolidation Arrangement with your creditors the result is the creditors stop calling and sending you letters, pay garnishees stop, and you will finally get a good night sleep.
It does not cost anything to call as the initial consultation is free. You will feel much better when you are in control of your debts.
Contact Rumanek & Company Ltd. for more information on bankruptcy and debt solutions. Or please fill out the free bankruptcy evaluation form. To learn more please visit our YouTube Channel. Rumanek & Company have been helping individuals and families overcome debt for more than 25 years.
Bad Bankruptcy Information