Secured Creditors

Secured creditors are creditors who hold a mortgage, charge, lien, or pledge against an asset as collateral security to ensure payment. In the event of a bankruptcy or proposal, most secured creditors are permitted by law to seize the asset pledged as security and apply the proceeds from the sale of the asset against the debt. If the proceeds from the sale of the asset are not sufficient to pay the debt in full, that creditor becomes an unsecured creditor for the balance. In many cases, arrangements can be made between the bankrupt and the secured creditor to continue payments on the debt so that possession of the asset can be maintained by the bankrupt/debtor.. However, if arrangements are made to continue payments and the debtor later defaults on the arrangement, the remaining debt will not be discharged by the previous bankruptcy proceedings. If you require any additional information, please contact one the MNP office conveniently located near you. A listing of our offices can be found athttp://www.mnpdebt.ca/contact/ontario/default.aspx