Difference between revisions of "I Don't Have Enough Money to Pay My Debts"

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== First steps ==
 
== First steps ==
 
If you cannot pay your debts:
 
If you cannot pay your debts:
# Contact the creditors. If necessary, see if you can negotiate a different repayment plan with each of them. For example, they may give you more time.
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#<span class="noglossary">Contact</span> your creditors. If necessary, see if you can negotiate a different repayment plan with each of them. For example, they may give you more time.
# If the creditors won’t agree, see if you can get a '''consolidation loan''' from your bank or credit union to put all the debts together at a lower interest rate than you are now paying. Seek the assistance of a not-for-profit credit counselling agency that can assist you in planning and applying for such a loan. See [[Credit Counselling Society of BC]] in the [[Resource List]].
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#If the creditors won’t agree, see if you can get a ''consolidation loan'' from your bank or credit union to put all the debts together at a lower interest rate than you are now paying. Seek the assistance of a not-for-profit credit counselling agency that can assist you in planning and applying for such a loan. See [[Credit Counselling Society of BC]] in the [[Resource List for Legal Help for British Columbians|Resource List]].
# If you cannot negotiate a repayment plan or arrange a consolidation loan, you should speak with a credit counsellor about some of the options under the ''Bankruptcy and Insolvency Act'', including:
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#If you cannot negotiate a repayment plan or arrange a consolidation loan, you should speak with a credit counsellor about some of the options under the ''Bankruptcy and Insolvency Act'', including ''proposals'' and ''bankruptcy''.
#* '''proposals''', and
 
#* '''bankruptcy'''.
 
  
== What happens next? ==
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== What happens next ==
If you pursue a formal '''proposal''' or '''bankruptcy''' itself, you must have a Trustee in Bankruptcy to assist you. Try the Yellow pages of your phone book under "Bankruptcy" or see [[Bankruptcy BC]] in the [[Resource List]] for contact information for Trustees in Bankruptcy. Most of your creditors will have to agree to a formal proposal. In a bankruptcy, your assets (except for necessities like clothing, medical aids, furniture, appliances, work tools, an inexpensive vehicle and sometimes your residence) are turned over to your trustee, who will use them to pay off some of your debts. Once you are "discharged" from bankruptcy (usually after nine months) the bankruptcy debts will be cancelled. It will take some time after the bankruptcy for you to re-establish your credit.
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If you pursue a formal proposal or bankruptcy itself, you must have a trustee in bankruptcy to assist you. To locate a trustee, the website of the Superintendent of Bankruptcy has a [http://www.ic.gc.ca/app/osb/tds/search.html?lang=eng lookup registry of all trustees in Canada]. You can also try the Yellow Pages of your phone book under "bankruptcy". Most of your creditors <span class="noglossary">will</span> have to agree to a formal proposal. In a bankruptcy, your assets (except for necessities like clothing, medical aids, work tools, $4,000 worth of furniture and appliances, an inexpensive vehicle, and sometimes your <span class="noglossary">residence</span>) are turned over to your trustee, who <span class="noglossary">will</span> use them to pay off some of your debts.  
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Once you are "discharged" from bankruptcy (usually after nine months) the bankruptcy debts <span class="noglossary">will</span> be cancelled. There are some debts, such as support payments, court fines and some student loans, that won’t go away after a bankruptcy. It <span class="noglossary">will</span> take some time after the bankruptcy for you to re-establish your credit.
  
 
== Where to get help ==
 
== Where to get help ==
See the [[Resource List]] for a list of helpful resources. Your best bets are:
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See the [[Resource List for Legal Help for British Columbians|Resource List]] for a list of helpful resources. Your best bets are:
* [[Credit Counselling Society of BC]].
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*[[Credit Counselling Society of BC]].
* [[Bankruptcy BC]].
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*[[Access Pro Bono]], [[Lawyer Referral Service]], and [[Private Bar Lawyers|private bar lawyers]].
* [[PovNet]].
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*The ''Law Students' Legal Advice Program Manual'' chapter "[http://www.clicklaw.bc.ca/resource/1727 Creditors' Remedies and Debtors' Assistance]," which has useful information on getting out of debt.
* [[Access Pro Bono]], [[Lawyer Referral Service]], [[Salvation Army Pro Bono Lawyer Consultation Program]], [[Private Bar Lawyers]].
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*The Clicklaw common question "[http://www.clicklaw.bc.ca/question/commonquestion/1014 I'm thinking about declaring bankruptcy]" for a few more resources on bankruptcy.
* Law Students’ Legal Advice Program Manual, see Chapter 10- [http://www.clicklaw.bc.ca/resource/1727 “Creditors’ Remedies and Debtors’ Assistance] for useful information on “Getting Out of Debt”.)
 
* See the Clicklaw common question [http://www.clicklaw.bc.ca/question/commonquestion/1014 "I’m thinking about declaring bankruptcy"] for a few more resources on bankruptcy.
 
  
 
Before meeting with a lawyer or advocate, complete the form [[Preparing for Your Interview]] included in this Guide. Make sure you bring copies of all documents relating to your case.
 
Before meeting with a lawyer or advocate, complete the form [[Preparing for Your Interview]] included in this Guide. Make sure you bring copies of all documents relating to your case.
  
{{Template:Legal Help Guide Disclaimer}}
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{{REVIEWED | reviewer = [[Drew Jackson]], March 2017}}
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{{Creative Commons for Legal Help Guide}}

Latest revision as of 20:14, 1 May 2017

Debt is one of the most common sources of legal problems. The problem is made worse when you try to ignore the debt and your creditors (the people trying to collect from you).

First steps[edit]

If you cannot pay your debts:

  1. Contact your creditors. If necessary, see if you can negotiate a different repayment plan with each of them. For example, they may give you more time.
  2. If the creditors won’t agree, see if you can get a consolidation loan from your bank or credit union to put all the debts together at a lower interest rate than you are now paying. Seek the assistance of a not-for-profit credit counselling agency that can assist you in planning and applying for such a loan. See Credit Counselling Society of BC in the Resource List.
  3. If you cannot negotiate a repayment plan or arrange a consolidation loan, you should speak with a credit counsellor about some of the options under the Bankruptcy and Insolvency Act, including proposals and bankruptcy.

What happens next[edit]

If you pursue a formal proposal or bankruptcy itself, you must have a trustee in bankruptcy to assist you. To locate a trustee, the website of the Superintendent of Bankruptcy has a lookup registry of all trustees in Canada. You can also try the Yellow Pages of your phone book under "bankruptcy". Most of your creditors will have to agree to a formal proposal. In a bankruptcy, your assets (except for necessities like clothing, medical aids, work tools, $4,000 worth of furniture and appliances, an inexpensive vehicle, and sometimes your residence) are turned over to your trustee, who will use them to pay off some of your debts.

Once you are "discharged" from bankruptcy (usually after nine months) the bankruptcy debts will be cancelled. There are some debts, such as support payments, court fines and some student loans, that won’t go away after a bankruptcy. It will take some time after the bankruptcy for you to re-establish your credit.

Where to get help[edit]

See the Resource List for a list of helpful resources. Your best bets are:

Before meeting with a lawyer or advocate, complete the form Preparing for Your Interview included in this Guide. Make sure you bring copies of all documents relating to your case.

This information applies to British Columbia, Canada. Last reviewed for legal accuracy by Drew Jackson, March 2017.


Creative Commons Attribution-NonCommercial-ShareAlike 2.5 Canada Licence Legal Help for British Columbians © Cliff Thorstenson and Courthouse Libraries BC is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 2.5 Canada Licence.