Debt and debt problems come in many shapes and sizes. From tax debt to credit cards to wage garnishments, bankruptcy trustees, now known as Licensed Insolvency Trustees, can help you with unsecured debt of all types. These are just 5 types of debt and debt-related problems where a bankruptcy trustee can help. Whatever your unique situation, bankruptcy trustees may be able to help with unsecured credit.
Debt Consolidation Loans
If you qualify for a good interest rate, a debt consolidation loan may make sense, but if you have a poor credit score, you may only qualify for high-interest debt consolidation loans. Many people who come to David Sklar & Associates first tried debt consolidation loans, only to discover that they still couldn’t afford to keep up with payments. Only bankruptcy trustees can provide debt relief that forgives a portion of your debt.
Credit Card Debt & Bank Loans
Credit card debt and bank loans are some of the most common debt problems we see at David Sklar & Associates. When you have used up your line of credit with the bank or pushed multiple credit cards to their limit, minimum payments can get out of hand while interest rates keep you from making any progress.
Tax & CRA Debt
Do you owe back taxes such as income tax or HST from a small business or self-employment? Taxes and HST aren’t a simple process when you run your own business and it’s easy to miscalculate what you owe or come up short at the end of the year if you weren’t fully informed. An audit can quickly turn up back taxes, as well as late penalties and interest charges you weren’t prepared to pay. Tax and CRA debt can become part of your consumer proposal in Ontario, easing the process for getting out of debt.
Student loans are a unique type of debt and consumer proposals and bankruptcy may only be able to help you stop collection efforts while in the process. Student loans come with a waiting period before they can be discharged fully in a bankruptcy or a consumer proposal. In Ontario, there is a seven-year waiting period before you can have a student loan discharged and forgiven in full in a consumer proposal or bankruptcy. There are some circumstances in which you can include student debt after five years if you prove financial hardship to the court. If you completed your studies more than seven years before you file a proposal or bankruptcy, the student loan debt will be discharged and forgiven.
Creditors and debt collectors can take legal action to garnish your wages. How much of your wages are garnished and whether they are taken before or after taxes depends on the provincial law. In Ontario, creditors can garnish up to 20% of your after-tax paycheque. Nevertheless, that can be a disruptive amount to lose when you have other bills and debt payments like mortgages to keep up with.
Talk to us at David Sklar & Associates right away if you’re facing a wage garnishment. Filing a consumer proposal puts a stay of proceedings on any attempts by individual creditors to collect from you, including a wage garnishment. A stay of proceedings prevents any one creditor from “skipping the line” to collect.
If you’re facing any of these debt problems, learn how a consumer proposal can benefit you and give us a call. A bankruptcy trustee can help you with debt consolidation loans, credit card debt, wage garnishments, student loans, and tax debt.