I read on one of your other pages where you talk about “secured” and “unsecured” debts. What’s the difference?

Q: I read on one of your other pages where you talk about “secured” and “unsecured” debts. What’s the difference?  A: “Secured” debt is backed up by some kind of collateral, which reduces the risk for your lender. Your mortgage, for instance, is a secured debt because the value of the house itself means the lender’s risk is minimized. To oversimplify things a bit, if you fail to pay the loan, the lender takes the house, and they lose nothing. A credit card is an example of “unsecured” debt. There is no “lien” on your property; that is, the lender has no right to take your property if you don’t meet your repayment obligations. Secured debt usually carries a lower interest rate because of the lesser risk for the lender.

Q: Harassment from my creditors is ruining my life! How do I make them stop? A: When you file for bankruptcy or submit a consumer proposal, your creditors are prohibited from contacting you.

Q: My wages have been garnisheed! What can I do about it? A: When you file for bankruptcy or submit a consumer proposal, any further garnishment stops too. It’s part of the “stay of proceedings.

 

Q: My credit is pretty bad. Can I still get a bank loan? A: If you already know your credit is bad, you shouldn’t even apply. Just applying can make your credit score even worse. Let us help you fix your credit first.

Q: If I come to see you, what are you going to be looking at? A: We’ll look at your assets and liabilities, and figure out your net worth, even if it’s negative. In other words, we’ll take what you own and subtract what you owe. We’ll take what’s coming in and subtract what’s going out. And that way we’ll have a clear picture of your situation. We’ll check out your credit report, too. Then we’ll get you set up with a monthly budget to get you started on the right track. Remember, a trustee represents your creditors, but we work for you!

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