Welcome to Bankruptcy Mississauga Ontario

New rules coming into force

Finally after years of delay new regulations regarding the administration of bankruptcies and proposals in Canada will come into force September 18 2009.
I could go into details regarding the reasons for the delay of coming into force for these new rules, but it’s not really relevant to someone considering making a proposal to their creditors or filing for bankruptcy. The fact is, after September 18, the way bankruptcy laws will apply to situations will change.
In general there are aspects of the rules that simplify the trustee’s job and should make the whole system simpler and less costly to administer, but again, that does not really matter to someone thinking of filing bankruptcy. What does matter is how the new rules will affect persons who file after September 18 2009.
In General many people who file after September 18 will see the term of bankruptcy extended beyond the current minimum 9 month period out to 21, 24 or 36 months. Automatic discharges will apply for the majority of cases of personal bankruptcy . The number of cases that will need to be heard in court will reduce dramatically. What this means is we can more reliably predict the outcome of a bankruptcy filing at the outset allowing people to make better informed decisions about filing.
After September 18, the only people who will see their bankruptcy finished within 9 months are persons or households with minimal income. Individuals or households with greater means will be required to pay for a longer period but will still qualify for an automatic discharge after a stipulated period. For someone who has never been bankrupt before but has income above a set threshold ($1870.00 net income per month for one person , more for larger households) they will be discharged automatically after 21 months of bankruptcy. For persons filing for a second time, with minimal income, they will be discharged after 24 months, and if they have income above the threshold, after 36 months. In all cases no court appearance will be required unless requested by their creditors.
These changes may make proposals to creditors much more attractive to persons having debt problems. There are some changes to proposals as well. The most significant change is the limit of debt allowed to be managed under a consumer proposal has been increased from $75000.00 per person to $250 000.00 ( not including a mortgage on their principal residence ) Meaning that the more complex and expensive “Division 1″ proposal process will not apply for the vast majority of individuals facing debt problems for which a proposal is their only viable option.
From these changes it’s clear that the direction of law changes are designed to favor consumer proposals as the typically chosen remedy to debt problems.

If you are having debt problems call us today at 310-PLAN. We can review your options and show you how these new rules may affect you.

Every day I meet with people who are stressed out about debt. I think it’s fair to say that people are stressed out about debt today more than any other time in the recent past.

But is it the debt that is the problem?

Maybe you have recently lost your job, maybe you were laid off a few months ago now and it’s looking like you won’t be called back soon or at all. I know for certain that I meet with people every day in my Mississauga and Brampton offices that are in this situation. When we sit down and review their budget we find in many cases that there is a lot more money going out than coming in. In many cases people stopped paying their debts some time ago, but still they are hundreds ( and in some cases ) thousands of dollars short each and every month.
The result of this shortfall is ballooning debt. The shortfall gets shuttled onto credit cards and lines of credit until there is no more credit to consume. Everyone is “hoping” things will turn around soon, then their household economy hits the wall. With no more credit and a running deficit in the budget the problem can no longer be ignored.

The problem feels like there is too much debt, because that’s who is making all the noise, creditors are calling and everyone wants paid. You feel like, “if only I could get rid of this debt everything would be ok” but really.. it won’t . The problem remains, not enough money coming in and too much going out.
If this is the case, then changes have to made to deal with the deficit, expenses have to be reduced and belts tightened, this could mean big changes. You may have to sell your home ( or surrender it to the mortgager if its value has dropped below what you owe on it ) you may have to give up a car, you may even have to take up a second job or take 2 part time jobs to replace a lost full time job. Every possible solution has to be considered and reviewed.
Bankruptcy or a Proposal to creditors is for many people a viable solution for debt, but it won’t solve a budget deficit if you have already stopped paying your creditors and still can’t make ends meet.
Once you have your budget under control, then it’s time to deal with your debts. A proposal to your creditors or a filing of personal bankruptcy could be your first step back to financial recovery.

Every recession ends and financial recovery will happen, personal financial recover will happen as well. If you need some help to get there Hoyes Michalos & Associates Inc. can help you.

Call 310-PLAN today and let’s get started.

“Economic downturn” seems to be on the tip of everyone’s tongues today. Practically every news report is talking about job losses and “tough times ahead” . People are frightened, jobs are on the line and many people have seen their pay cheques shrinking due to the loss of overtime or short term lay offs.

It’s fair to say that everyone is feeling the effects of this recession, but the question remains, what can you do?

In a word.. plan.

Do a budget, reduce unnecessary expenses, cut back on spending and dig in. Reducing your debt should be your first priority. Build up a contingency fund of savings ( the new tax free savings account may be a good place to tuck away this money). Everyone needs to have a plan to carry them through lean times, It’s a mistake to think “it won’t happen to me”.

Practically everyone I see in my Mississauga and Brampton offices never thought they would need the help of a Trustee to resolve their financial problems but the fact is that for many people facing rising debt and dropping income, bankruptcy or a proposal to creditors is the only viable way through the downturn.
What is certain is that there are options to dealing with debt that suddenly becomes unmanageable. Part of you plan to survive the recession should be to ensure that you know all your options.

If you are facing a lay off, if you have seen your income shrink and your debt become too much to deal with its time to take action now. Make a plan, Hoyes Michalos & Associates Inc. can help you. A phone call and a free consultation can get you on the path to being debt free.

Call 310-PLAN and lets get started.

It has for some people struggling under student debt load.

Recently the government made changes in the Bankruptcy and Insolvency Act that reduces the waiting period for the discharge of student loan debt from 10 year to 7 years.

For many people who have been burdened with crushing student loans this is very welcome news. No one accepts students loans thinking that they will still be struggling to pay then off many years later but it is a fact that many people are faced with exactly this problem. Life can throw curves and for many people their higher education simply did not pay off as hoped. This can result in overwhelming debt that can lead to wage garnishments, collection actions and deepening stress levels.

Finally for some people who have been waiting for their loans to become dischargable in personal bankruptcy, the wait has been shortened dramatically. In some cases loans only 5 years old can qualify to be discharged with the approval of the court.

If you have student loan debt that you can’t get on top of you owe it to yourself to find out what your options are.
Call 310-PLAN or email us and make an appointment to see me at our Brampton or Mississauga offices, It costs nothing to find out your options.

Well it is the end of another year busy year for most of us and the holiday season and all its festivities are almost done. For most, we are a few pounds heavier and our pockets are a few dollars lighter. Now it is time to look forward to a new year and all it brings with it.

One thing I recommend to the people I meet with in Mississauga and Brampton is to sit down and spend some time doing up a plan or budget for the new year. A budget is important as it will help you set goals for such things as a holiday or new sofa that you need.

To start, review what has happened in the past year or at least the past 3 months to determine what you make in a month, that is your take home pay after taxes and how you spend it on food, car payments etc. For most of this information does not change and can be put into a new budget for the new year. Then we add the new things and the increases that are required for things like rent, food and gas for the car. Yes, it is expected that gas prices will once again increase in the summer months so don’t forget to make an allowance for this extra cost. If it does not happen then that is a good thing but at least you have tried to budget for it.

I like to do my budget based on my monthly income and expenses. It’s just easier to organize and see how much is left over each month or not. Also don’t forget to put money aside each month for the one time expenditures. For instance some people pay their car insurance only one a year. Thus you need to set aside funds each month so that you will be able to make that payment in the month it is required.

Once you have done this budget for each month in the new year you will be able to see if there is a trend toward savings or are you behind each month. If it looks like you will be behind you may want to determine why. Is it because you have credit card payments that are charging a lot of interest and you cannot make the payments and need to decide each month which one will be paid and the ones that will not? Do you have payday loans that you being taken out for at least one pay per month and you never seem to catch up on the payment? Are you borrowing from friends and family to get to the end of each month?

If this sounds like you then these are some red flags that may mean you have some financial difficulties to deal with. This is where we at Hoyes Michalos & Associates will be able to assist you. We can provide you with all the options available for dealing with your debts. Personal bankruptcy may not be the only option. You may be able to do a consumer proposal. Or you may be able to see your bank about a debt consolidation loan. To understand all your options and have as many as possible available to you, usually means starting as early as possible. So give us a call at 310-PLAN or in Mississauga at (905) 848-3649 and we can set up an appointment for you to see one of our trustees at a location that is convenient for you. This meeting is a free consultation and we will review all the options and allow you to make the choice that’s right for you.

My husband and I filed bankruptcy about a year and a half ago. It was discharged in July 2005. We included our car loans, however we continued to make payments. About two months ago my husband decided to buy a new truck and the dealership told him that his current truck was discharged and that he didn’t need to trade it in, all he had to do was walk away from it. The debt showed as discharged on our credit report. However, Toyota Finance Corp sent a confusing letter saying they we either owe 2K to get the truck back or they will sell it & we owe the defficiency. Can this really happen if the debt was discharged in the bankruptcy? Help I don’t know where to turn for answers.

Often when I meet with clients at our Brampton and Mississauga offices we end up discussing “what went wrong”. In many cases some unforeseen event has caused financial trouble to become unbearable. Divorce, job loss, injury or illness can all cause our finances for come apart.
Sometimes I meet people who run into trouble just because they don’t have a plan. Keeping tabs on expenses is not exciting, certainly not as much fun as going shopping, or going out, but it is a necessary part of financial health.

If you think that your finances may be a little out of control. If you don’t seem to have enough money to pay all your bills on time. Its time to make a plan, if you take control early enough you can get back to financial health by sticking to your plan. If things seem to be out of your hands then you may need some help. Give us a call we can help you to make a plan that can get you a financial reset and get you debt free, often without bankruptcy. Call 310-PLAN today and take control of your future!