Don`t know what to do!!!

Posted on Wednesday, June 4, 2008

Email Us
Contact: (email or phone)
Message:

My wife and I are having difficulties. Between us we make $120,000 per year but our debt simply is not maneagable and we don`t know what to do. Right now we have approximately $45,000 in lines of credit which have been fully drawn on. We have mountains of credit card debt (a total of roughly $64,000) which we are only making monthly payments on. We have two vehicles, both leased and the total payments on vehicles comes to $1,500 a month. We have no proprety (we rent) and don`t know where to turn. The creditors have been calling, I think we have a garnishee that has been sent or is about to be sent to my work and are very stressed. If we file for bankruptcy can we keep our vehicles (we need them to get to work as we live out of town). Will someone come into our house and take everything we own? Do you think there is any other solutions (We looked into a consolidation loan, but we couldn`t qualify)?

Thanks for your help!

Filed under: Money Management and Consumer Proposals and Bankruptcy
 posted by Questions @ 7:33 am
1 Expert Comment:

 At June 9, 2008 | 2:48 pm , Barton Goth GCO Bankruptcy Trustees Said...

If you file for bankruptcy typically as long as you are current on your lease payments, can afford to continue making those payments and your leasing company is willing to cooperate, then you are able to keep the vehicles. You will see that car loans and leases are considered secured creditors and therefore operate outside of the bankruptcy process. As such your trustee really doesn’t have control of what will happen it is all in the hands of the leasing agen and typically they are more than happy to see you continue to pay on the leased vehicle.

As well, when you file for a bankruptcy normally people don’t loose a great deal. For instance in Alberta you are permitted to have up to $5000 in household furnishings and another $4000 in clothing. When looking at these dollar amounts it is important to recognize they are based on a liquidation or quick sale basis and as a result we rarely find people have a major issue.

As for other solutions, I would encourage you to contact a local trustee and discuss the possibility of making a Division I Proposal. I think you might find it is a good way to avoid bankruptcy but still allows you to deal with your debt in a reasonable fashion.

Please type your comment below:

You must be logged in to post a comment.