Insolvency is a formal term from bankruptcy law. If you are insolvent, it means your liabilities or debts exceed the value of your assets. You would also be considered insolvent if you are unable to pay your debts on time.

My wages are being garnished to pay for my outstanding debts. I am afraid to answer the phone because it may be a debt collector calling. My creditors are threatening to sue me, repossess my personal property or hire a collection agency to recover their money. I have been borrowing money for household expenses from friends and family to make it from one pay cheque to the next. I am paying one creditor one month and another...

A secured debt is directly tied to an asset which may be seized by a lender if you fail to make your required payments on it. For example, a mortgage is considered a secured loan, with your home as the related asset. If you fail to make your mortgage payments, your secured mortgage lender has the right to foreclose on (i.e. seize) your home and sell it to pay off your debt. If the proceeds from the sale of an asset don’t entirely cover your debt,...

Bankruptcy isn’t the only option. Numerous solutions including a Consumer Proposal and other options may be available. Contact an MNP office today to discuss your options with a Licensed Trustee.

The first step in combating debt is to analyze where you are spending your money. If you see a clear way to stop incurring more debt and take action immediately to consistently spend less, you may be able to regain control on your own. However, if your financial troubles persist, an MNP Licensed Insolvency Trustee can discuss different options with you such as Consumer Proposals, Bankruptcy or put you in contact with a Credit Counselling organization...

A Consumer Proposal is for individuals who are able to make payments to creditors (either monthly or as a lump sum), but need to change the current arrangement of their payments. A Consumer Proposal can change the payment terms (up to a maximum term of 5 years) and the overall amount you are required to pay. A Bankruptcy is a formal process to relieve an individual of their debts to unsecured creditors. A Bankruptcy lowers your credit rating to the...

There are other options for you to resolve your financial issues. These include a Consumer Proposal or Bankruptcy. It is always best to talk to a Licensed Insolvency Trustee to find out which solution is right for you.

Depending on the amount of debt and number of creditors you have, it may be possible for you to directly contact your creditors and negotiate a lower interest rate or a repayment schedule that works for you. With informal proposals, each of your creditors will expect you to present them with a plan outlining how you can pay them back. You may also be required to submit a sworn statutory declaration outlining all of your assets, debts and income....

There shouldn’t be an initial setup cost for an informal debt settlement. The purpose of an informal debt settlement is to lower the interest rate on your payments and potentially extend the payment period. Additional costs typically result from the accumulated interest charges over a longer repayment period.

Whether you qualify completely depends on the creditor you are contacting and the plan you present to them. Important factors such as the length of the repayment term and the amount of debt you have will impact their decision to accept or decline your proposal.