There are many organizations that present ‘debt management programs’ as a solution to your debt challenges. In reality, these organizations essentially attempt to negotiate an informal debt settlement on your behalf for a fee. You would sign a contract with a debt consultant who will then work with your unsecured creditors on reducing your interest rate and how much you owe while extending the time period you have to pay back debts. You will then...

Many Canadians use credit cards on a regular basis — but have you ever considered what a credit card actually is? Essentially you are borrowing money from your financial institution, with the intent of paying it back within a specific timeframe. Failure to pay off your entire balance results in high interest rates (around 19% or more) on the remaining balance, while a failure to make your minimum payments may hurt your credit score, increase...

A payday loan is a short-term loan designed to provide you with some extra money until your next paycheque. Typically speaking, a payday loan is limited to 30% of your take-home pay. You are expected to pay back this loan once your next paycheque arrives by providing the payday loan provider with a post-dated cheque. While a payday loan doesn’t require credit approval, it is one of the most expensive ways to borrow money, with interest rates...

The tax refund relating to the year of your bankruptcy will be sent to the Trustee for the benefit of your creditors. Subsequent tax refunds should be sent to you. The Trustee has a right to apply your GST credits towards the costs of administering your bankruptcy (up to a maximum of $1800). Once the Trustee’s costs are covered, the GST credits will again revert to you.

The Licensed Insolvency Trustee will advise the Office of the Superintendent of Bankruptcy and all the proven creditors of a debtor, of the debtor completing the terms of their bankruptcy or consumer proposal, but it is the obligation of the debtor to advise the credit bureaus.

Refer these creditors to your Trustee. If the creditors are persistent provide them with a copy of your Discharge Certificate or Order and a copy of your Statement of Affairs showing that the creditor was included in your bankruptcy and that your debt to them is now discharged. If the creditor is harassing you or collecting in an unethical manner you can report them to the Office of Consumer Affairs in your Province.

If your Trustee hasn’t been discharged yet, simply tell the creditor to contact your Trustee and participate in your bankruptcy. If your Trustee has been discharged then the creditor is entitled to be paid the same dividend (% of debt) your other creditors received from your bankruptcy. You will have to pay this amount. Contact your Trustee to discuss this. If you deliberately omitted the creditor from your bankruptcy (the onus is...

Alimony or child support payments. Student loans (if you stopped being a student less than seven years ago). Debts arising from fraud. There are other debts as well, but it is best to speak with a Licensed Insolvency Trustee to discuss your exact situation.

Having financial goals is very important, and starting with savings is a great plan. We recommend starting with a savings account for emergencies. Once you’ve built up an emergency fund you can start savings for other goals like retirement, major purchases or travel! Use a financial goal calculator to help you get started.

Speak to your Licensed Insolvency Trustee to determine a course of action.