Waiting Not to go bankrupt!
I am currently unemployed and on EI benefits till September. I have unsecured debts of $50,000.No other assets except I have RRSP of about $8000 (contributed over 2 – 5 years ago). if i wait till after June 30 this RRSP will be exempted. My 2 questions are:
1) what is the likelyhood that the creditors will accept this in a consumer proposal as in a bankruptcy they wouldn’t get much?
2) How is the dividend calculated – my understanding is that 20% is trustee fees plus $1500 filing fees. are the taxes taken out first (tax bracket 20% plus additional 30% as money is in labor sponsored fund) and then the remaining offered as dividend.
Whether or not the creditors will accept a consumer proposal depends on the amount of money offered in the proposal, the more you offer, the more likely it will be accepted. I don’t think you will have to much difficulty finding a margin that is acceptable to both you and the creditors.
As for the administration tariff, there are 2 one time draws of $1500.00 that are taken first and then the 20% is paid as the dividends are. There are some other small costs (counseling sessions, GST, court fees…) but they are marginal. While I can’t comment on every trustee’s office, we include all these fees in the total amount we offer up so that everyone has a clear idea of what it will cost them out of pocket each month, but it would be a good point to clarify with your licensed trustee.