Meet Stephanie,
the mother of a young son, James, who is just about
to enter primary school. Recently, Stephanie has
overextended her credit and, despite her best efforts,
is unable to pay her bills. Realizing that she needed
to speak to an expert, Stephanie found a
Licensed Insolvency Trustee located in her area and
has gone to meet with her. After speaking to the trustee,
Stephanie has determined bankruptcy was the most
appropriate option for her. After explaining the bankruptcy
process and looking more closely at her income, the trustee told
Stephanie that she will have to make what are called
“surplus income payments.” These payments ensure that
people who declare bankruptcy and have sufficient income,
contribute to paying off a portion of their debt. In simple terms, surplus income
is the amount of income a person who has declared bankruptcy
has that is over and above what they need to maintain a
reasonable standard of living. The amount they have to pay
is calculated according to standards established by the
Office of the Superintendent of Bankruptcy Canada. Stephanie will have to make
these surplus-income payments for a total of 21 months because
this is her first bankruptcy. If this were her
second bankruptcy, the payments would
have to be made over a longer period of time. Stephanie was also told that if
her income changes at all during bankruptcy, she must inform the
Licensed Insolvency Trustee, as this may affect the
amount of her payments. Stephanie knows she has some
work to do but feels a weight has been lifted just knowing
she is starting to deal with her financial issues. Are YOU in financial trouble? Not sure where to turn? Visit our website and use our
searchable database to find a Licensed Insolvency Trustee
in your area who can help. Licensed by the Office of the
Superintendent of Bankruptcy Canada, Licensed Insolvency
Trustees are the only professionals who can file a
consumer proposal or bankruptcy application in your name. While visiting our site, you may
want to view other videos that help explain the options that
might be available to you.