Category: Debt Consolidation


How Will my Credit Rating be Affected by Filing a Bankruptcy or a Proposal (‘Consolidation’)?

A common question Licensed Insolvency Trustees field is “How is my credit rating affected if I file a bankruptcy or a proposal?” Generally by ‘debt consolidation’ they are referring to a Consumer Proposal, which is a form of that. But let’s deal with bankruptcy first.







Can I Settle My taxes Owing to CRA in a Consolidation?

Absolutely you can. About 58,000 people did just that in 2015 in Canada. Income tax arrears are eligible to settle with Canada Revenue Agency (CRA) as a consolidation solution (along with all other unsecured debts such as credit cards and lines of credit) in the form of a proposal. CRA are not only just a likely to reduce the principle (and ALL of the interest) as other creditors, but in most cases they are even MORE likely to participate, since this acts as a form of collection for them in their overworked portfolio.



407 ETR Debt Now Dischargable in Bankruptcy or Proposals

A recent ruling in the Ontario Court of Appeal means that 407 ETR highway debts can now be included in a bankruptcy or a consumer proposal under the Bankruptcy and Insolvency Act (BIA). In the past, people filing either a bankruptcy or a proposal were discharged from all their unsecured debts, but the MTO would withhold a new vehicle permit (“sticker”) when it came time for the person to renew unless payment of 407 debt was made in full. Effectively, this meant that that particular debt had not really been discharged.