What is the Real Weight of Debt in The Bankruptcy and Insolvency Act?

Mar 20, 2014 by

There has been a rise in personal bankruptcies in the last decade; this has been made worse by the economic downturn we all felt in 2008. Experts put the numbers at over 80% and increasing. There are a lot of reasons why people find themselves in a situation where they have so much debt, there is absolutely no way of getting out of it until just giving in and screaming for help. Life happens, people lose their jobs, people get sick to such an extent they cannot create an income and when the income dries out, there’s nothing left to take care of the mounting and unrelenting debt.

The Bankruptcy Insolvency act was created to help anyone who find themselves in a financial hole they cannot see a way out of. The Act buys us time to tackle issues, get our feet from under us and go on repairing what left is of our lives. It protects debtors from being intimidated by creditors who can make life virtually difficult. This is an act that give you room to have a fresh start and rehabilitate your financial situation as best as you can.

Bankruptcy is not the only option you have according to the law. There are two other options you can consider:

1. Consumer Proposals to Creditors

This involves the debtor, an officer at the Office of the Superintendent of Bankruptcy (OSB) who will act as a trustee and the creditor. What a Consumer Proposal is a contract between the debtor and creditor on one hand and the trustee on the other. The contract could entail extending repayment period or freezing interest for a particular duration. It works well in cases where the creditor is a bank or financial institution where the debt is related to loans of no less than $250,000.

2. A Commercial Proposal

A commercial proposal is meant to help businesses and business owners in need. This kind of proposal does not have a limit on the amount owed.

How Bankruptcies work

If you do decide to file for bankruptcy, the office of the Superintendent of Bankruptcy will appoint a trustee who will investigate the debtor’s financial affairs in order to work out and execute a plan to get creditors paid and to give debtors a chance to start afresh without having the weight of debt crushing them. The trustee can help the debtor work out debt payment plans to creditors and actually manage the process as all payments will be left to the trustee to co-ordinate. The trustee does more than that, he can offer advice to the debtor on how to manage whatever money they have.

The thing that scares a lot of people is that: when you file for Bankruptcy you cede ownership of any property you might have. This property might be sold off for the trustee to initiate payments to creditors. Once a Bankruptcy order has been issued creditors cannot initiate any collections directly from the debtor but they have to go through the appointed trustee. This does not come free or easy, to get financial freedom through bankruptcy will be require the debtor to pay a fee. In addition to the fees, your trustee will expect to get monthly contributions from you the debtor to honor the contracts and arrangements that were made to keep creditors away from your door.

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Montrealers and The Debt Conundrum: Understanding Your Options

Aug 23, 2013 by

In today’s world, most people find it hard to stay debt-free for various reasons; this, however, is not to say that it is an impossible feat. There really is no problem with having debt as long as you can comfortably manage it. This is not the case for quite a number of people in Toronto. After years of borrowing and living on credit, they eventually come to the realization that their debt has spiraled out of control. While it is unsettling to be in such a situation, all hope is not lost; you still have options.

Credit counselling is vital because it helps you find solutions to your debt problem regardless of how critical it might be. You should seek credit counselling from a certified credit counsellor and not just family and friends. A credit counsellor will help you find paths with the least resistance as far as dealing with your debt problem is concerned. He or she will sign you up to the most appropriate debt management program.

On the other hand, a great tool for debt counselling is the consumer proposal. It is one of the most popular debt management options. In this case, you will need a bankruptcy trustee to help you with the nitty-gritty of the process. First and foremost, the trustee will file the proposal which must be approved by those to whom you owe the most money. A fee of 750 dollars will be required in order to facilitate this first step. After the creditors agree to your proposal, a similar amount will be charged in order to get things going.

The trustee will also negotiate with your creditors in an attempt to find the most suitable arrangement under which you can pay off what you owe. It is important to note that under a consumer proposal, you will be required to clear your debt within 5 years. If you fail thrice to make the necessary payments, your creditors could take you to court. If this ever comes to pass, you might be forced to file for bankruptcy so as to prevent creditors from coming at you full swing.

If you file for bankruptcy, you’ll still need the services of a bankruptcy trustee. You will hand over your assets to the trustee who will then proceed to sell them so as to pay off some of the money you owe. By signing for bankruptcy, your creditors will no longer deal directly with you; all engagements will be between them and the trustee.

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Retirement Fund for a Safe and Secure Future

Aug 7, 2013 by

The Teachers Retirement System of the State of Illinois, also known as TRS, was created in 1939 by the General Assembly of the State of Illinois. The Illinois TRS has close to 40 billion in net assets and is the country’s largest public pension fund. The Illinois TRS is funded by public school teachers, administrators and personnel and employers and the State.

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Image courtesy of freedigitalphotos.net – by Stuart Miles

Every state has its own teacher retirement fund. The retirement benefits, survivor benefits and disability benefits it offers its members is helping millions of teachers across the country. This system provides a series of benefits to active members, retirees and employers.

The members of this system consist of full-time, part time and substitute teachers employed in Public Schools. The State Board of Education certificate is required to enjoy the benefits this system offers. Some of the benefits a member is entitled to include retirement annuity, disability benefits, health insurance after retirement and death benefits.

A member or an annuitant qualifies for the various Teachers retirement help benefits based on specific qualifications and requirements. The TRS is one of the few State funded retirement systems and is helping teachers across the country plan their lives well and live their lives with confidence after their retirement. The benefits a member receives when alive will be passed onto a beneficiary. The beneficiary will continue to receive the benefits until his death.

Teachers Retirement System websites are well maintained and constantly updated and provide Teachers with retirement help and all the latest information and details that a member would need. There are a range of articles that members can read to lean about the benefits they can enjoy. The well written Teachers retirement help articles allow them to be aware of their rights and benefits.

By logging in with their individual account number, active and retired members can find out the latest benefits, regulations and other information. The TRS manages the retirement accounts of its members. A member is able to calculate his pension amount and plan his income accordingly. The benefits each individual is entitled to are based on the number of years of service they have put in and their salary.

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Borrowing Options for Today’s Businesses

Jul 20, 2013 by

One of the most common ways people borrow money is through an unsecured loan.  An unsecured loan can be obtained strictly based on a borrower’s credit score, as opposed to secure loans that require a type of collateral. Hence, the borrower has no obligation to use any of their property as collateral in order to acquire a loan.  The only prerequisite to receive the loan is for the borrower to have a reputable credit rating.  These types of loans can be a greater risk for lenders, so, typically, lenders will charge a higher rate of interest.  Moreover, the interest is not tax deductible.

Another popular medium through which people can borrow money is an unsecured line of credit.  An unsecured line of credit is very similar to the aforementioned loan.  Borrowers do not have to worry about securing their line of credit with collateral, such as a home.  The interest rates can be variable and are usually higher than secure lines of credit.  Before the line of credit is approved, the borrower must exhibit a high credit rating.  Most banks that offer this form of credit will require you to have proof of an annual income, details of employment, SSN and at least some time as a customer for the lending enterprise.

Finally, business loans are granted by banks or lender for the use of a corporation.  It can be tough to procure business loans, especially when lenders administer rigorous review practices.  Lenders usually want to see that the business they are lending to has sufficient assets to act as collateral in case the enterprise were to fail.  A business will have to provide proof of regular cash-flow, as well as evidence of expertise in the specific endeavor being pursued with the loan.  Although the process may seem taxing, being able to prove creditworthiness can be achieved with preparation and planning.

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