Don & Maria: A Bankruptcy & Consumer Proposal Solution

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Messy Family Finances – One Toronto Family’s Solution

 

Despite the clarity that we try to present our case histories with – finances can be messy.

And for some young families, that have been struggling to get a solid start – finances can be extremely messy.

A case in point is Don and Maria (not their real names).

Originally from the Maritimes, this determined couple in their early 30s have two small children and a dream of financial security.

However, when they first came to David Sklar & Associates, what they had was:

    • $40,000 of debt,
    • no way to repay it, and
    • creditors threatening legal action.

Some of the debt came from Don’s 12 year-old student loans, but much of it came from their decisions to move in hopes of finding work. There were many moves, from the East coast to Alberta to Ontario – as well as moves within each of the provinces they moved to.

Without strong marketable skills, neither Don or Maria were able to find good paying, long lasting jobs. And each move put them further into debt.

Of the two, Don had been the most successful at finding work, and as a result, most of their debts were in his name.

Their last move to a small townhome, in an older Toronto neighbourhood, brought additional stress. Don was accepted to a vocational training course that was subsidized, but brought in only $1,200/month. Maria was unable to find a job and daycare for her two toddlers that would net her more than the child subsidy she was getting of $960/month. This meant that they would have to live on $2,160/month while Don was taking his one-year course.

At this point in time, some of their creditors had had enough and began to put extreme pressure on Don and Maria for payment – threatening to put garnishees on their incomes.

Don and Maria realized that they had to deal with their financial mess quickly – or risk ending up in even more trouble. They decided to try a free consultation with David Sklar & Associates.

*** ***

During their initial appointment, they met with Serena Peksa, a Certified Insolvency Counsellor, who reviewed their finances and options with them in detail. Personable and professional, Serena put them at ease and helped them to focus on their financial issues with a clarity they had not previously had.

As they were both insolvent, with no assets, they could both file for bankruptcy – however Don and Maria though it would be better for one of them to file for bankruptcy and one of them file a consumer proposal. That way, they would be able to repay at least some of their debt.

After meeting with the trustee and reviewing their situation, it was agreed that Don should be the one to declare bankruptcy, since the debt in his name was the largest at approximately $33,000. His debts included student loans (which were old enough to be removed in a bankruptcy), utility bills, back rent to previous landlords, and moving expenses.

As he was a first-time bankrupt and had no surplus income, Don’s bankruptcy would last for 9 months with monthly fees of $200. This would coincide with the completion of his vocational training – and provide a timely fresh start.

Maria would file a consumer proposal on the approximately $7,000 of debt that was in her name. Her proposal was accepted by her unsecured creditors with monthly payments of $80 to run for 60 months – after which, she would be freed from those debts.

Both Don and Maria, as part of their bankruptcy and consumer proposal agreements, were required to attend credit counselling. During their first session they were able to use their new found financial clarity to begin work on a plan for moving their family towards the financial security they had only dreamed of in the past.

To protect our clients’ privacy, aspects of this case study have been altered

Take Your First Step Towards A Debt Free Life

If you are overwhelmed by debt, call us at 1-844-962-9200 to book a FREE, confidential appointment. We will review your financial situation in detail and discuss all of your options with you. Alternatively, you can fill out the form below and our team will reach out to you. 

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Very knowledgeable, helpful and fast service
Anthony Mcfeat
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I am so delighted to have found this company. They are the best. Everyone in the office is very nice never to busy to assist you. Thank you David Sklar and Shirley and associates for being you. 😊🌺😊
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Trina was amazing and quick. No judgement was made and they all made me feel I made the right decision. Would highly recommend them
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Trina was very easy to work with. Any questions I had were answered promptly. What seemed like a complicated process was explained in a clear manner that wasn't at all intimidating. It made for a more comfortable experience during a turbulent time.
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Jackie is very professional...I would recommend David Sklar to anybody especially knowing how understanding they are.
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I had Shirley and Kim take care of my finances. From the very first moment I spoke with Shirley I could sense how caring, professional and patient she was. She was also very understanding with my lack of financial knowledge and never made me feel dumb as some other companies have.Her and Kim were always very quick to respond to emails, always available if I called and answered my abundance of questions in such detail that I now believe I have a thorough understanding of how finances work. I am hopeful about my fresh financial start and very grateful I had the privilege of meeting and working with these two beautiful women.I also spoke briefly with Richard over zoom and he to was extremely friendly, patient and made sure I was well taken care of.I could not recommend David Sklar and Associates more. Thank you again.
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Good professional team! Jennifer is the best, helped me through everything and answered all my questions. Made the process easy! Would recommend Jennifer and the team at David Skylar.
gary round
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Christine and her team are amazing and professionals. I called for help and she responded right away to help me.thank you and I really appreciated for everything you do.
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Thank you so much for the helpYou took away the most stressful things in our lives which was our dept you guys are amazing and would recommend you to everyone
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The staff here are fantastic (Cori handled my visit) and are willing to go above and beyond to help people who need help, I recommend them 100% for people who are looking to move on in good standing.
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