My leased car was returned but I owe $1.00
I recently completed a consumer proposal where I returned my leased car as part of the proposal, when I go through the list of creditors I repaid, Ford Motor company is listed but for the amount of $1.00? Is this correct of did the trustee make an error?
Posted from: Ontario
This is the correct way to list the creditor on the Statement of Affairs. At the time of filing your proposal to your creditors the car has not yet been disposed of by Ford Motor Company. As a result the trustee has no way of knowing exactly how much that debt is going to be once the car is sold. The trustee then lists the claim as “contingent” and values it at a dollar. A contingent claim is a claim that can be made after a certain outcome has been completed. In other words, this signals to the other creditors and to Ford that there is going to be a debt owing to Ford Motor Company that will form part of the proposal after the vehicle has been sold or disposed.
Once the car is sold, Ford will determine how much is owed to them after subtracting any amounts received from the sale of your leased vehicle and will file the appropriate paperwork.
Depending on the amount of the debt it can have an effect on your proposal. More than likely the Administrator of your proposal already took that into consideration when helping you determine what your required payments are in your proposal. It may be a good idea to ask them if your proposal payments will change depending on the value of the debt to Ford Motor Company once the car has sold.