Last year a number of changes were made to the Bankruptcy and Insolvency Act in Canada. Some of these changes make it much less attractive for a consumer to choose bankruptcy as a means to achieve debt relief.
This is because the surplus income allowance was reduced and the rules about surplus income have changed. In bankruptcy, there is a maximum amount of money you are allowed to earn before surplus income will be assessed. Previously, even if you had surplus income, if you were a first time bankruptcy filer you would still qualify to be discharged after 9 months. Now if you have surplus income you will not qualify to be discharged for up to 21 months.
Bankruptcy is a onerous process where the bankrupt is obliged to disclose income and other personal information to their trustee on a month basis. The idea of being an undischarged bankrupt for 21 months and committed to a Bankruptcy Trustee for that length of time, is a scary proposition for many people.
These changes in the Bankruptcy and Insolvency Act have turned the tides on the public's opinion on bankruptcy, resulting in more Canadians choosing Consumer Proposals as an option for debt relief [http://www.trueassess.com/debt.php]. A consumer proposal is administered by a trustee and involves making a settlement to your creditors that is repaid over 4-5 years. Once the proposal is accepted, it is bound and so the consumer does not have an ongoing obligation to the Trustee in Bankruptcy. They do not have to report income and other information to the Bankruptcy Trustee, they do not have to be "discharged" and the Consumer Proposal can be paid in full at any time. Once paid in full the Consumer Proposal is removed from the consumer's credit report [http://www.trueassess.com/financialreportcard.php] 3 years from the date it is paid in full.
The benefits outlined are showing in Federal Government reports on Bankruptcy and Consumer Proposal filings in Canada. In 12 months preceding Jan 2010 there were 115,435 bankruptcies filed in Canada and 37,385 Consumer Proposals filed. In the 12 months preceding Jan 2011 there were 91,568 bankruptcy filings (a reduction of 21%) and 43,758 Consumer Proposal filings (an increase of 16%).
These numbers indicate two things:
3. There is a clear decrease in Bankruptcy Filings in Canada and an increase in Proposal filings
4. It appears over all, there were less (down 5%) total filings which is a sign that economy is showing some signs of improvement.
For more information about the decrease in bankruptcy filings and increase in proposal filings visit [http://www.trueassess.com]
This is because the surplus income allowance was reduced and the rules about surplus income have changed. In bankruptcy, there is a maximum amount of money you are allowed to earn before surplus income will be assessed. Previously, even if you had surplus income, if you were a first time bankruptcy filer you would still qualify to be discharged after 9 months. Now if you have surplus income you will not qualify to be discharged for up to 21 months.
Bankruptcy is a onerous process where the bankrupt is obliged to disclose income and other personal information to their trustee on a month basis. The idea of being an undischarged bankrupt for 21 months and committed to a Bankruptcy Trustee for that length of time, is a scary proposition for many people.
These changes in the Bankruptcy and Insolvency Act have turned the tides on the public's opinion on bankruptcy, resulting in more Canadians choosing Consumer Proposals as an option for debt relief [http://www.trueassess.com/debt.php]. A consumer proposal is administered by a trustee and involves making a settlement to your creditors that is repaid over 4-5 years. Once the proposal is accepted, it is bound and so the consumer does not have an ongoing obligation to the Trustee in Bankruptcy. They do not have to report income and other information to the Bankruptcy Trustee, they do not have to be "discharged" and the Consumer Proposal can be paid in full at any time. Once paid in full the Consumer Proposal is removed from the consumer's credit report [http://www.trueassess.com/financialreportcard.php] 3 years from the date it is paid in full.
The benefits outlined are showing in Federal Government reports on Bankruptcy and Consumer Proposal filings in Canada. In 12 months preceding Jan 2010 there were 115,435 bankruptcies filed in Canada and 37,385 Consumer Proposals filed. In the 12 months preceding Jan 2011 there were 91,568 bankruptcy filings (a reduction of 21%) and 43,758 Consumer Proposal filings (an increase of 16%).
These numbers indicate two things:
3. There is a clear decrease in Bankruptcy Filings in Canada and an increase in Proposal filings
4. It appears over all, there were less (down 5%) total filings which is a sign that economy is showing some signs of improvement.
For more information about the decrease in bankruptcy filings and increase in proposal filings visit [http://www.trueassess.com]
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