What happens with the monies while waiting for the 6 month payout to creditors
December 16th, 2010 by Questions
For the consumer proposal my trustee will pay my creditors every 6 months. So what happens with this money that I am paying in during that time. Is it sitting in some account? Is it invested? Do the lower amount creditors get paid off sooner than the others or are the payments divided and everyone is paid their share for the same amount of time?
Posted from: Ontario
One Response to “What happens with the monies while waiting for the 6 month payout to creditors”
Please post a follow up comment below:
(Note: comments are reviewed by moderators and then posted after approval. In addition, due to high volume some of the comments might not be posted.)
You must be logged in to post a comment.
December 17, 2010 at 9:35 am, A licensed trustee said:
Your money sits in a trust account – that’s one of the reasons we are called “trustees in bankrupcy” because we hold assets in trust. The money held in trust earns interest and that interest is added to your payments and is distributed to your creditors.
Unless the terms of your proposal specifically require the smaller dollar amount creditors to be paid first, they won’t be. Every creditor receives a proportional share of the dividends when they are paid.