Bankruptsy or not

October 6th, 2009 by Questions

First off let me say THANKS… in advance for any advise offered here. I am forced retired, and living on a meager disability pension.
I have just recently been gutted by a $10,000 Lawyer fee for a long and rough divorce after 31 years of marrage, What I got away with left me just enough to move away, and try to start a new life, but then I got a back tax bill for $10,000 and have been taxed for the past year at 40% or $550 a month paid in full now, out of a $1800 pension after tax, which left me behind and in arrears with all my other bills and medical expenses, I ended up stealing from Paul to pay Peter which left me currently with about another $40,000 in debt, from credit cards that I used to live on over the past year.
Question is should I try to get a proposal from creditors or go bankrupt, sorry for the long windedness, but I felt a little history might show that I have at least tried to stay responsible and afloat.

Posted from: Nova Scotia

Questions

One Response to “Bankruptsy or not”


, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:

For me, the two things that need to be considered when making this sort of decision are a) your cash flow and b) your stage of live vs. the benefits of a proposal.

In terms of cash-flow, while I haven’t looked at your monthly living costs, I can only assume that based on your net income that there isn’t a great deal of money left after you cover your monthly living cost, so it is questionable whether or not would be able to the payments that would be necessary with a consumer proposal.

The next thing you have to consider would be the benefits of filing a consumer proposal? Well the major one is protecting your credit rating. However, at your stage of life I doubt very much whether or not you are planning any major purchases (i.e. house etc.), so the question becomes how valuable is it to you to protect this credit rating. Most people find when they are retired this is not really something that will benefit them at all and as a result end up looking more at the bankruptcy route.

So at the end of the day the choice is yours, and before you make a decision I would encourage you to meet with a local trustee, but overall the most important thing is that you feel comfortable with the direction you choose.

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