With its announcement that Canadian borrowing habits were slowing down, the Bank of Canada produced news in early 2013. The main indicator of this was the exceptionally small growth in the overall quantity of debt that Canadian families were carrying on average.
For example, the average Canadian household has added only $0.27 in the last three months of 2012 to the amount of debt it bore per $100 of after-tax, disposable income. With the borrowing rate slowing down, most Canadians seem to make an effort to both decrease their unsecured and guaranteed loans.
On average, that’s excellent news for Canadians. Since it is an average number, however, this means that some residents have added much more than $0.27 to the amount of debt they carry for every $100 of disposable income.
Struggling Yukon residents
Some Canadians are even struggling to pay on their debt the minimum payments right now. If you are one of those Canadians living in the Yukon, it may be helpful to look into a debt solution such as debt consolidation, debt settlement, loan counseling, a consumer proposal, or bankruptcy.
Bankruptcy Financial Impact on Yukon
Bankruptcy is the last resort debt option reserved for those who have no sensible opportunity to pay their creditors what they owe even if their main and interest rates are lowered. While those in the Yukon who file for bankruptcy often have tens of thousands of dollars in secured and unsecured debt, you don’t have to owe much cash to qualify for bankruptcy.
How to qualify for bankruptcy in Yukon
If you owe your creditors as little as $1,000 and are unable to pay your debt, you can qualify for bankruptcy.
Bankruptcy filing process
You must first contact a licensed bankruptcy trustee to file a Yukon bankruptcy. Once you file for bankruptcy, the trustee creates a trust in your name that will pay your creditors part of what you owe them based on your current net worth. In essence, your property is deposited in this trust and your creditors’ payment is administered by bankruptcy.
The bankruptcy will be discharged after nine months if you have held your agreement to a halt and all of your debts will be cancelled.
Bankruptcy pros and cons in Yukon
Yukon citizens should know its main benefits and disadvantages when filing for bankruptcy. The main benefit is your debt erasure and the comparatively smooth economic begin you gain from a bankruptcy. You will also need to go through basic financial training classes to ensure that you don’t get into debt again over your head.
On the other side, some main drawbacks exist. For instance, you will have to abandon some of your assets unlike other debt alternatives such as debt settlement. Like the other provinces and territories in Canada, there are exemptions for what you have to hand over to your trustee, but what you are going to give up is still significant. If you file for bankruptcy in Yukon, the following are exempt:
- Food, fuel and other essential items worth twelve months
- Ordinary and essential clothing
- $500 in household furniture
- $600 in household equity instruments
- $3,000 in household equity
- balance of all registered pension savings plans minus twelve months of contributions prior to bankruptcy
Finally, as mentioned, in a bankruptcy, you are getting a fairly clean beginning to your finances. That qualifier is essential because your credit will effectively be damaged for seven years when you file for bankruptcy. You can only obtain loans at extremely elevated interest rates during that era if you can qualify for them at all.
Bankruptcy is perhaps the only debt option for some, but before you file it pays to know about other alternatives. Complete your request for debt relief to find out about other debt schemes that can prevent you from bankruptcy.
- Bankruptcy Yukon
- Bankruptcy Saskatchewan
- Bankruptcy Quebec
- Bankruptcy PEI Prince Edward Island
- Bankruptcy Ontario
- Bankruptcy NWT North West Territories
- Bankruptcy Nunavut
- Bankruptcy Nova Scotia
- Bankruptcy Newfoundland
- Bankruptcy New Brunswick
- Bankruptcy British Columbia
- Bankruptcy Manitoba
- Bankruptcy Alberta
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.