Ep. 47 - Gambling Debt Help: Consumer Proposals and Bankruptcy
For some, gambling leads to a situation where they are unable to pay bills and debts when due. This is incredibly stressful. There are options for addressing this, but many people don’t have the full information about these options. Listen to this episode and keep reading to find out more.
In episode 47 of our podcast, Fold em: Help for Gambling Problems, hear from Blair Mantin, a Licensed Insolvency Trustee and President of Sands and Associates in Vancouver.
Tune in to episode 47 and learn about:
What is a Licensed insolvency trustees and how do they help with unmanageable debt?
What are consumer proposals and personal bankruptcy - Who is eligible? What is involved?
Answers to common questions about consumer proposals and bankrtupcy - Will it impact my credit rating? Do I have to get rid of my car, home and/or RRSP? Is tax debt included? How will it impact my spouse?
Differences with bankruptcy proceedings in Canada and the United States
How do I find a Licensed Insolvency Trustee?
Listen now to episode 47 of Fold em by clicking on the green play button at the top of the blog.
If you prefer to tune in directly from Apple Podcasts or Google Podcasts, click on the red “Listen and Subscribe” button below.
If you are unable to pay your bills and debts when they are due, there are options available
A first step is a free consultation with a Licensed Insolvency Trustee
What is a Licensed Insolvency Trustee? How Do They Help With Unmanageable Debt?
In this episode of Fold em, you hear from Blair Mantin, a Licensed Insolvency Trustee and President of Sands and Associates in Vancouver.
What is a Licensed Insolvency Trustee (LIT)?
professionals in Canada who are regulated by the federal government and provide advice and services to individuals and businesses with debt problems. Up to 2016, they were called bankruptcy trustees.
LITs have to go through a course of study and certification to be licensed.
there are about 1, 066 Licensed Insolvency Trustees and 218 different Insolvency Trustee firms in Canada.
How does a Licensed Insolvency Trustee help with unmanageable debt?
LITs offer free consultations to review your financial situation and provide advice on options for addressing debt
Only LITs are licensed to administer consumer proposals and personal bankruptcy
What is a Consumer Proposal? What is Bankruptcy?
Blair Mantin explains that Licensed Insolvency Trustees (LIT) are able to offer two options to assist people who are insolvent (unable to pay their debts when these are due). These options are: a consumer proposal or personal bankruptcy. There are other options available through a Credit Counselling Society and through dealing directly with your bank and/or creditors. For more information on these, see the blog for episode 46 of Fold em.
Consumer Proposal
A formal, legal process that is administered by a LIT. A proposal is developed and presented to creditors with an offer to pay a proportion of what is owed to them, or extend the amount of time to pay it back, or both.
Once the proposal is accepted by the creditors, the debt is consolidated and one equal payment is made to the LIT each month until it is paid off, up to a maximum of 5-years. Interest on the debt is not paid, nor does it continue to build. There are no more phone calls from creditors or collection agencies.
85% of people who consult with a LIT, go the route of a consumer proposal
There are no fees outside of the monthly payments to an LIT. 80% of the monthly payment goes to the creditors and 20% goes to the LIT for administering the consumer proposal
Personal Bankruptcy
A formal, legal process for people facing overwhelming financial difficulties to clear their debts. In Canada, it is available to those who owe more than $1000 and insolvent (e.g. unable to pay their debts whe due)
The bankruptcy process is typically 9-months, but can be longer for those with surplus income or if it’s not their first bankruptcy.
Those involved in bankruptcy are required to prove their income on a monthly basis, keep a budget, and participate in at least two financial counselling sessions through their LIT.
There is a monthly fee while involved in bankruptcy which is based on your income. For someone assessed to be low-income, the fee would likely be $2300 spread out over 9-months.
Frequently Asked Questions
Blair Mantin, answered many common questions about consumer proposals and bankruptcy. Here’s some of the key points:
Will a consumer proposal or bankruptcy impact my credit rating?
Yes, when a consumer proposal or bankruptcy is filed, your credit rating resets to zero and it will show on your credit report for 6-years after discharge
However, the LIT will tell you about ways to rebuild your credit rating. For most people who take these steps, within 2-3 years they have rebuilt their credit enough to be able to qualify for a mortgage, car loan and credit card.
Will I qualify for a consumer proposal or bankruptcy if I have a car, home and/or registered retirement savings?
If you owe more to your creditors than the value of what you own in a home or car, then you are considered to be insolvent and would qualify for a consumer proposal or bankruptcy.
In Canada, registered retirement savings and pensions are protected if someone is involved in a consumer proposal or bankruptcy proceeding.
The best option is to consult with a LIT about your particular financial situation
Can tax debt and student loans be dealt with in a consumer proposal or personal bankruptcy?
Yes, in Canada (not in the United States)
If you owe more than $200,000 in tax debt and the amount owing is more than 3/4 of your debt, you would be eligible for bankruptcy, but can’t complete the bankruptcy without appearing in Court to discuss the situation that gave rise to the tax debt
How will my spouse be impacted if I’m involved in a consumer proposal or bankruptcy?
If there is no joint debt, your spouse will not be impacted
If there is joint debt, there are options such as a joint consumer proposal.
What are differences in Canada and the United States with consumer proposals and bankruptcy?
In Canada, these proceedings are administered by a Licensed Insolvency Trustee. In the United States, they are administered by a lawyer
In the United States, tax debt and students loans can not be dealt with through a consumer proposal or bankruptcy
How Do I Find a Licensed Insolvency Trustee Near Me?
In Canada, the Federal Government has a searchable database of active Licensed Insolvency Trustees.
Blair Mantin encourages people to look at online reviews of Trustees and pay attention to how you feel at the first appointment. It’s ok to consult with more than one LIT to help find a trustee that is a good fit for you.
Want More Information on Consumer Proposals and Bankruptcy?
If you would like to hear more from Blair Mantin about consumer proposals and bankruptcy, listen to episode 47 of Fold em. He talks about options for spouses to protect their financial security when there are gambling problems - whether they remain in the relationship or pursue separation.
Listen now by clicking on the green play button at the top of this blog or the red “Listen and Subscribe to Fold em” button below.
You can also learn more about credit counselling, consumer proposals and bankruptcy by listening to episode 1 of Fold em and reading the blog.
Finally, Blair Mantin is the co-host of a weekly radio show on CKNW 980 AM in Vancouver. It’s called “The Dollars and Sense Show” and is from 5-6 pm every Sunday evening. He takes questions from listeners and provides useful information about managing money and handling debt. The show is also available as a podcast, so you can listen on your own time.
If you would like to contact Blair Mantin, Licensed Insolvency Trustee with Sands and Associates, reach out to him at: info@sands-trustee.com or through the Sands and Associates website.
Check out other episodes of Fold em and be sure to subscribe so you don’t miss out when new ones are released.
Want to Connect With Support and Counselling in British Columbia?
If you live in British Columbia and would like to learn more about free, confidential support and counselling services from Gambling Support BC, click on the red “Connect with Support in BC” button below. Or, go to the Gambling Support BC website. You can also access our services through the Gambling Support Line. It is available 24/7 at 1-888-795-6111.
Gambling Support BC services are available to any British Columbia resident experiencing problems from gambling. You don’t need to stop or quit gambling or be self-excluded to access these free supports.
Our counselling and outreach services can help you figure out how to manage gambling concerns, including how to control or stop gambling. You decide what will work for you.
You can talk to an outreach support person about next steps for yourself if you aren’t wanting counselling. They can help you find self-help resources or local community resources and make a plan that meets you where you are at.
Want to Connect With Support and Counselling in the Rest of Canada and the United States?
For a list of gambling help services in Canada, visit www.gamblingguidelines.ca/getting-help
To find gambling help resources in the United States, visit the National Council on Problem Gambling
Fold em is a podcast hosted by Adrienne Cossom and her colleagues at Gambling Support BC. Whether you are looking at stopping or scaling back your own gambling or supporting a family member with a problem, this podcast will help you take back control. Hear from gamblers who have been through it and get tips from counsellors. Fold em is funded by Gambling Support BC.
To learn more about gambling concerns and how to access resources and support, go to the home page of this website, click on the red “Learn More” button below, or connect with us through Facebook.