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Printer friendlyFour key reasons why you might want to speak to Mark Silverthorn before you see a bankruptcy trustee
Mark Silverthorn might be able to help you avoid bankruptcy.
1.A bankruptcy trustee has only 2 tools in his toolbox
If you are experiencing money problems you may have as many as 8 options for dealing with your unsecured debts. A bankruptcy trustee can help you with two of these eight options, filing for personal bankruptcy and making a consumer proposal, a formal proposal under which you offer to repay approximately 30% of your debts to all your unsecured creditors over several years. Your unsecured creditors may or may not accept a consumer proposal. A bankruptcy trustee may not be in a position to assist you with your financial situation other than these two options out of a potential 8 options for dealing with your unsecured debts.
Some bankruptcy trustees may have a preference for recommending personal bankruptcy over making a consumer proposal
A bankruptcy trustee receives his compensation more quickly when a consumer files for personal bankruptcy than under a consumer proposal. In addition, a consumer proposal usually involves more time, energy and expense on the part of a bankruptcy trustee compared with filing for personal bankruptcy. Consequently, some trustees, particularly older trustees operating smaller practices, may have a preference for recommending personal bankruptcies over consumer proposals.
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Your financial situation might not be as bleak as you think
A trustee might not explain to you why your financial situation is not as bleak as you might think. The trustee will ask you to provide him with a list of your outstanding debts. You should not expect the trustee to advise you that you will likely never have to pay a particular debt because collection agencies sue relatively few files, you are judgment proof or the limitation period on your consumer debt has expired or will expire at some future date. This means that a consumer could conceivably file for personal bankruptcy in circumstances where he might have been able to avoid paying all of his debts. Please note that your failure to pay a debt will likely have negative consequences for you in the future.
A bankruptcy trustee will likely discuss with you the respective merits of filing for personal bankruptcy and making a consumer proposal. Your list of unsecured debts is not an accurate picture of your true financial situation because, as a practical matter, you might never have to pay some of these debts or you may be able to settle some of these debts for significantly less than 100 cents on the dollar.
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You might be able to deal with your debt situation without resorting to either a consumer proposal or personal bankruptcy
Depending upon your particular circumstances there might be a number of very effective strategies you can employ to improve your debt situation without resorting to either a consumer proposal or personal bankruptcy.
Legitimate debt avoidance: You might be able to take advantage of limitation periods to avoid paying some of your consumer debts. Depending on your situation you might be able to benefit from the reluctance of both of your creditor and its collection agent to sue you. Your failure to pay a debt will likely have negative consequences for you in the future.
Debt elimination: The most effective way you can eliminate debt is to settle certain types of unsecured debts for less than 100 cents on the dollar, and the greater your debt is 'discounted' the better. You might be able to eliminate a significant amount of your debt for major savings by using proven debt elimination strategies. You can eliminate certain types of debt utilizing settlements for anywhere between 5% and 85% of the amount a collection agency claims is owing.
To learn more about bankruptcy alternatives and alternatives to consumer proposals
You can speak to Mark Silverthorn or you may want to buy a copy of Mark Silverthorn's e-book titled A How-to Guide for Dealing with Collection Agencies in Canada .