Loss and Recovery with a Consumer Proposal
In her mid-50s, Pamela (not her real name) suffered a severe emotional loss.
During the next few years, she tried to fill her emptiness with shopping, expensive gifts for family, and travel. Pamela earned a reasonable income. But her out-of-control spending began to put her into serious debt.
She and her husband took out a second mortgage against their home to pay off her debts. But she continued to spend. Eventually, she cashed in her RRSPs to pay off her debts. But her spending still didn’t stop, resulting in debt piling up again.
And then, over a three-month period:
- Pamela’s husband’s health failed, and he could no longer contribute to the household income.
- Pamela, who had wanted to work past 65, was facing imminent retirement due to her poor health.
With nothing left to cash in and debts continuing to pile up, Pamela became desperate. Finally, after accepting how serious her situation was, she got in touch with a grief counsellor and David Sklar & Associates.
The grief counsellor helped Pamela to begin her emotional recovery and David Sklar & Associates helped her begin her financial recovery.
Here's how David Sklar & Associates was able to help Pamela resolve her debts
Pamela met with a Licensed Insolvency Trustee at David Sklar & Associates to discuss her situation and review her options. At the time of their meeting, Pamela owed the following unsecured debts, all of which were in her name only:
Credit Cards | $38,000 |
Bank and Other Loans | $3,700 |
Revenue Canada Tax Debt | $2,000 |
Total Unsecured Debts | $43,700 |
Here's how much Pamela was able to save by filing a consumer proposal
Pamela’s proposal offered to pay $15,300 of the existing $43,700 owed.
Her creditors accepted the proposal, and she would pay $255 per month for 60 months.
Pamela will only repay debts totalling $15,300 – a reduction of 65% of the original amount.
After completing her consumer proposal, she’ll be released from her unsecured debts. In the meantime, her creditors cannot contact her for extra payments nor charge interest on the negotiated debt.
Pamela knows her journey toward emotional and financial recovery will take time and effort. But she’s confident in her abilities and knows that it’s doable. And if her early efforts at recovery are any indication, we don’t doubt that she’ll achieve her goals.
To protect our client’s privacy, aspects of this case study have been altered.
Photo by Polina Tankilevitch, Photo by Karolina Grabowska, Photo by Anastasia Shuraeva
Calculate savings
Consumer Proposal - 0% Interest
Debt Consolidation Loan - 30% Interest
Do Nothing - 19% Interest
* Calculations above are made over a 5 year period at a rate of 80% savings. This calculator provides an estimate of the total savings you may receive when filing a consumer proposal. Actual results may vary. Your payments will depend on your income, assets, and debts.
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Learn how we can help you find debt relief with a consumer proposal or personal bankruptcy. Our passionate and experienced team at David Sklar and Associates has helped thousands of individuals break free from crippling debt payments. Our experts can answer any questions about your debts and recommend a solution based on your unique needs and goals.
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