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407 ETR SUPREME COURT OF CANADA DECISION STILL PENDING
It seems that the Supreme Court is really moving slowly on resolving this issue. The question at hand for the Supreme Court is largely the supremacy of legislation and whether or not the Federal Bankruptcy & Insolvency Act effectively trumps Provincial Statutes such as the Ontario Highway Traffic Act. But there is a far more […]
Read moreARE YOU A HIGH TAX DEBTOR?
If you have high tax debts here are some things you need to know. High tax debts are personal taxes over a value of $200,000 that constitute 75% or more of the debtor’s total unsecured debts. So for example if you owed Revenue Canada $300,000 for income taxes and only owed $100,000 on other debts […]
Read moreCOULD YOU SURVIVE A RATE INCREASE?
If you have a $200,000.00 mortgage at 3% interest amortized over 25 years with a five year term, your monthly payments would be about $946.00. During the five year term you will pay about $27,739.00 in interest. If you had to pay the same mortgage at the rate of 6% over the same term, you […]
Read moreDO YOU OWN YOUR HOME OR DO YOU RENT IT FROM THE MORTGAGEE?
You might not like the answer. The fact is that more Canadians (69% of households) have their names on title on their homes than ever before – but they also own far less of the value of the property than ever before. There are more mortgages, institutional and private than ever in history. According to […]
Read moreCONSUMER PROPOSAL ACCEPTANCE:
A question I am frequently asked is: “what are the chances that my consumer proposal will be accepted by my creditors?” The answer in a nutshell is “very good!” The reason is that a basic premise underlying all consumer proposal filings is that they must provide the creditors with a better return than they would […]
Read moreCASH STORES vs FIRST TIER LENDERS
This is an excellent article by Doug Hoyes on the perils of payday loans and borrowing money from Cash Advance outlets, whether on the Main Street or found online. Interestingly, toward the end of the article, Doug turns his attention to a problem that I have frequently blogged about “irresponsible top tier lending”. Unfortunately he […]
Read moreIS BANKRUPTCY STILL TOO CUMBERSOME TO BE PRACTICAL?
The bankruptcy provisions under the Bankruptcy & Insolvency Act (“BIA”) were streamlined several decades ago to make it easier for consumers to get out of debt, but at that time it was still harder for people to acquire debt. Bank deregulation and lack of viable consumer protection has created a very predatory lending environment over […]
Read moreCANADA REVENUE AGENCY AND PROPOSALS
Is the CRA too aggressive and adversarial with consumer debtors? The Canada Revenue Agency is notorious for asking for additional (enforcement) clauses to be added to proposals to “require” debtors to stay on top of current filing and remittances throughout the life of the proposal. They have even taken this notion a step further at […]
Read moreThe reason for getting out of debt
It may seem obvious why people want to get out of debt, but the reason is may not be what you expect. Yes, people are stressed, frustrated, wasting money on trying to maintain impossible minimum monthly payments, moving debt from one form of credit to another, they need relief, they want to break free from […]
Read moreIMAGINE WINNING MILLIONS OF DOLLARS – WHAT WOULD YOU DO?
Like most people, I have often dreamed of what it would be like to have a lot of money, to become suddenly rich either by developing that great new widget or winning the lottery. And I, probably like you, have sometimes wondered how much would be enough. Throughout my life I have encountered, in various […]
Read moreWHO HAS THE HIGHEST DEBT TO INCOME RATIO?
Your knee jerk reaction to that question may be way off the mark. Many people still seem to stigmatize the less advantaged. When talking about debt problems the people who are in denial are the ones who are in fact most vulnerable to excessive debt. The common notion is that poor, less educated people or […]
Read moreARE CANADIAN BANKS AND THE CRA IN A COMPETITION
To see which can take the most of your money! Tax Freedom Day was on June 26th this year – that means that every single penny you earned up until that date went to the government in some form of taxation. With that knowledge and some other government statistics let have some fun with numbers. […]
Read moreAverage London (Ontario) Home Buyer
The average home price in the London area is $329,000 – which begs the question “who can afford to buy?” Assuming the home buyer has the requisite 5% down payment and the 4% for CMHC insurance as well as the roughly $1,500 for legal fees and disbursements (totalling $30,452) all that remains is to qualify […]
Read moreWHAT HAPPENS IF MY TRUSTEE IS IN A DIFFERENT CITY?
Trustees are licenced Federally to act in Provincial jurisdictions. Many trustee firms have centralized processing centres as a means of cost and quality control. There are good and bad things about such a system. The best is that staff are specialized to deal with specific aspects of each file and can do so cost effectively […]
Read moreBANKS AND THE RIGHT OF OFFSET (OR “SET OFF”)
Talk to your trustee about the treatment of your bank account before you file a bankruptcy or proposal. In Ontario the Limitation Act prevents legal action being taken against you for debts, except mortgage debts, that are more than two years past payment. In other words if you have ceased making payments for a period […]
Read moreJESUS HAD NOTHING ON THE BANKS
Jesus was able to feed 5,000 people with nothing more than 5 loaves of bread and 2 small fish. Through the miracle of credit and fractional reserve banking, banks make Jesus’ miracles seem insignificant. Using complex calculations of loss expectations and by creating their own rules, banks have been able to loan thousands of trillions of […]
Read moreRESOLVE TO SOLVE YOUR DEBT PROBLEMS
Each year we all make resolutions appertaining to lifestyle changes we know we should make, by mid-year most of us have forgotten them. Servicing debt has tremendous economic and social consequences. Economically it means that every purchase made using credit will cost more than if we saved up and simply paid in full at the […]
Read moreTHE GIFT OF UNDERSTATEMENT
I enjoy reading Don Pettis’ articles on the CBC news website but find that sometimes he has a penchant for the understatement. Canadian consumer debt is so entrenched in our social consciousness there may never be any escape from the black hole of debt. Yesterday, I was at a breakfast meeting listening to a tax […]
Read moreHOW MUCH WILL MY HOUSE COST
Think about the term, amrtization and the frequency of debt consolidation. Banks have actively encouraged consumers to use their homes like ATMs – every three to five years as the mortgage comes up for renewal consumers would be encouraged by banks to consolidate their unsecured debts into their mortgages. This would eat up any equity […]
Read moreHOW MANY MORTGAGES ARE THERE IN CANADA?
Search google for “how many private mortgages in Canada” and you’ll get 52,000,000 hits. Search for “how many bankruptcy trustees in Canada?” and you’ll get 5,590,000 hits. In neither case does the answer readily pop up. In Canada there are about 900 or so licensed and practicing trustees in bankruptcy – there are several […]
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