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Lender encouraging me to do something which is probably illegal

I had borrowed money from a very well known , high profile lender who advertises heavily and who deals primarily with high risk borrowers. When I got into financial trouble and called their loan specialist to negotiate a payment plan , this person encouraged me to lie about my income to my insurance company so that I could get the money to pay the minimum amount due on the loan. He also suggested that I not pay the other creditors while I pay him since the other creditors are “a big bank , they won’t care so much about your loan”. He also warned me against making any consumer proposal stating that they WILL oppose it and make my life tough. He also warned me that if I declare bankruptcy he WILL oppose my discharge. He also said that they are powerful and have attorneys who can drag me through the courts and waste my time and contact my employer and make me lose my job.

Can they do that if I declare bankruptcy? Should I call him again and try to record the conversation?

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One Response to “Lender encouraging me to do something which is probably illegal”

Barton Goth GCO Bankruptcy Trustees said...

The first indication that this person should not be trusted is the encouraged you to lie about your income, this is fraud and will get you into more trouble than simply telling the truth. While there is a nugget of truth to his comments (i.e. a creditor can oppose a consumer proposal or a discharge), he is not really telling you the full story.

In a consumer proposal the decision is not made by one individual creditor, you need a majority of the creditors to vote in favor, so if one creditor votes against but others vote in favor, there is nothing the individual creditor can do.

In a bankruptcy, it is true that a creditor can oppose a discharge, but they have to have grounds to do so. As a result we find relatively few situations do creditors oppose.

Instead of wasting time discussing these things with the lender in question you would be much better of to contact a licensed trustee, describe the situation to them and get a qualified opinion as to what may or may not take place.