Bruno is 41 years old. With his wife Roxanne, they are the parents of a 4-year-old boy. The pretty house they bought in the countryside in 2019 to live a peaceful existence unfortunately gave them a very bad surprise.
The property, heated by solar energy and propane gas, promised to offer them a good quality of life and savings on their electricity bill.
But the heating system had a fault that caused carbon monoxide fumes in the house. The whole family was intoxicated, further adding to the burden and distress of the parents, whose child was recently diagnosed with a brain tumour.
Become unfit for work
His mother takes care of him full time, and only Bruno’s income can support the small family. However, because of carbon monoxide poisoning, he developed serious health problems that rendered him unfit for work.
Hoping to obtain compensation, he initiated a latent defect lawsuit against the former owner, but for lack of means, he quickly abandoned the process.
Refusal of the consolidation loan
Currently, their cash inflows are limited to family allowances and disability insurance, for a total of $2,696 per month. Bruno also had to face many difficulties and delays before being able to touch this one.
“During this time, I had to resort to my credit cards and a quick loan to be able to pay the bills, which represents a debt of $23,175 that I am unable to repay,” he laments. .
Because their income is just enough to cover their monthly expenses of $2,540. This amount does not include the monthly minimum payments to be made on his credit card balances or the repayment of the quick loan, which amounts to several hundred dollars.
To get out of this difficult financial situation, Bruno asked his financial institution for a consolidation loan. This would have allowed him to pay off all his debts at once and only have one payment to make each month at a lower interest rate.
Unfortunately, given his low income and current payment difficulties, the bank refused the loan. The father therefore went to consult a licensed insolvency trustee firm to find out what his other options were.
keep the house
Three solutions are available to Bruno, explains Karina Tardif, a licensed insolvency trustee at Raymond Chabot.
“He could sell his house, which has good equity of $70,000, and pay off all his debts,” she says.
However, they would have to find housing, and given the prices of properties, the high interest rates and also the rents, this is not a good choice for them.
“The mortgage loan repayment is $595 per month, plus $175 for municipal taxes. They have little chance of succeeding in relocating at this price,” notes Karina Tardif.
In the event of bankruptcy, the house would also have had to be sold to pay off creditors.
consumer proposal
“Bruno therefore preferred the consumer proposal which consists of reimbursing only part of the debts. This will last for 60 months, at the end of which he will be released from all credit card balances and the fast loan. During this period, interest will also cease to run on the debt,” specifies the trustee.
He can also keep his vehicle for which the payments are up to date.
THEIR FINANCIAL SITUATION
Assets :
- Single family Home
- Financed 2017 Ford Focus automobile
Debts:
- Mortgage: $145,500
- Credit cards: $21,675
- Car loan: $6,425
- Quick loan: $1500
TOTAL DEBTS (excluding mortgage): $39,600
Monthly income :
- Disability insurance: $1575
- Family allowances: $1,121
TOTAL REVENUES: $2696
Monthly expenses:
- $2,540 (including mortgage, municipal taxes, telephone, electricity, gasoline, groceries, car loan, license, registration, etc.)
2023-06-13 23:37:56
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