It is not always simple to assess the financial status of Canadian citizens, particularly if the information are mixed. Data are more mixed in some provinces than in others, which makes such evaluation extremely hard. Prince Edward Island is one such province.
Economists show several favorable indications for PEI residents ‘ financial status. In recent years, for instance, a trend has seen individuals living in PEI cut their household annual expenditure. The average quantity spent by PEI families on commodities and non-essential goods, for instance, in 2011 was around $500 lower than the past year. This is positive, because Canada as a whole has effectively risen its mean household expenditure rate.
Average debt in PEI
However, there are some negative indicators that more and more PEI residents are seeking assistance to repay their debt to the consumer. Those who are truly desperate may even consider making a bankruptcy filing. In 2012, PEI had its average total consumer debt in the third largest increase in the country, with an increase that remains below the PEI average, a reason for concern. PEI is also at the forefront.
For a wide range of reasons, PEI citizens can boost consumers ‘ expenses and some of them achieve a point where the minimum payments for their consumer debt are no longer available. You should know how it is before you join bankruptcy proceedings if you fall into this category and consider a debt alternative such as bankruptcy.
Bankruptcy process in the PEI
The bankruptcy process was established by the Canadian law for persons who can not pay their monthly bills for whatever reason. PEI bankruptcy is the last choice for debtors, and most individuals will not file until other debt alternatives have been tested, such as debt settlement programmes. In any event, insolvency does not only affect people who owe their creditors hundreds of thousands of dollars.
Can I file for bankruptcy?
Residents can enter bankruptcy if they owe at least $1,000 in unsecured debt, although alternative debt programs are nearly always a better choice in this stage.
What does a licensed insolvency trustee do?
A licensed insolvency trustee will file for bankruptcy. Your trustee will evaluate your position to see if you are entitled to insolvency protection. If you fulfill the requirements, the trustee creates a confidence in which your estate is deposited except for certain exemptions.
This confidence will pay your creditors and at least obtain some of what you owe when your property’s value naturally exceeds your exemption. As with the rest of Canada’s regions, PEI sets its own bankruptcy exemption level, which can be found below.
PEI bankruptcy filings should not be made before the adverse consequences for your economic position can be considered. In general, creditors are reluctant to give you cash seven years after your bankruptcy. However, PEI citizens who have been released from bankruptcy sometimes discover creditors who lend them elevated interest rates for the cash.
Pros of bankruptcy in Prince Edward Island
The positive effects of bankruptcy in your scenario, on the other side, might outweigh these negatives. Almost all of your debt will be eliminated if your bankruptcy discharges itself, although some debts, for example food payments, stay.
You’ll also be given financial advice, which will assist you handle your cash more effectively. This is one of the greatest sections of bankruptcy and it has been discovered highly useful by many to teach them how to lay a stronger basis for the future.
Exemptions from PEI Bankruptcy
You can hold the following when you file for bankruptcy in PEI:
- A vehicle with a value of $3,000 or lower,
- clothing needed for your family and you
- food and household items with a value of $2, 000 or lower
Note that all provinces are subject to exemption from contributions from registered pension plans. You will have to pay the bankruptcy trustee for the last 12 months but maintain all the other money presently saved on your pension account.
Bankruptcy is good, but it is best to find other methods to resolve your debt issues in the long term. For further data on other alternatives to relieve debt before retreating into bankruptcy, see if you qualify with our free online calculator.
CONSUMER PROPOSAL EXAMPLE
Example Unsecured Debts
|2||Credit card 1||$6,812|
Your Monthly Repayments Would Be
a Consumer proposal $748
(total contractual repayments)
a Consumer proposal $295
(total contractual repayments)
* Subject to creditor acceptance
* Payment subject to individual circumstances
* Credit rating may be affected
* Fees apply, subject to individual's circumstances.