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so i filed a Consumer proposal in may 2010 and its in good standing..Im trying to re finance my mortage and the lawyer has advised theres a judgement against me filed on the 9dec2009 and its active and unless i pay it off he cant continue with the refinancing. This is with RBC and if I check my consumer proposal document RBC was part of the proposal! so what do i do now?im confused if RBC was part of the proposal then why theres a judgement? keep in mind the judgement date is before i filed the proposal. Do I somehow have to pay this? please help..tks

Posted from: Ontario


A licensed trustee said...

This is not an uncommon problem. By filing the proposal you stopped any/all collection action on the part of the bank – their Judgment against you is “stayed”. That doesn’t mean the Judgment is cancelled – until the proposal has been completed the debt still exists and the Judgment remains in place. They do this in case you don’t complete the proposal…

Here are a couple of suggestions:
1) contact your trustee and explain t them what you are trying to do – at the very least they could have answered your questions
2) your trustee may be willing to ask RBC to remove the Judgment long enough for your to arrange for new financing, then put it back – if they do you should expect to pay whatever legal fees RBC incurs to do this
3) if they won’t co-operate (and they do not have to) then here’s how the law works if you still refinance. The new money has to be paid to the Sherriff to deal with the Judgment. The Sherriff is required to forward the money to your trustee, not to RBC. As you are in a proposal your trustee is required to return the funds to you… This may take a few weeks if the Sherriff’s office wants to take their time…