Maripier and François, a couple in their 30s, are parents to two young children. In 2018 they bought a North Shore townhouse, a perfect little nest for their family.
François works in IT and Mariepier as an accounting technician. They don’t wallow in gold, but they can live comfortably and support themselves.
However, since the birth of her second child in 2020, Mariepier has noticed changes in her spouse. At first, she believed the behavior changes were due to the pandemic, remote work and the lockdown. But after several bouts of anger and panic attacks, she insists he see a doctor. The verdict came a few weeks later: François suffered from schizophrenia.
Maripier was also unable to return to the office at the end of her maternity leave as one of her children had just been diagnosed with autism. She therefore stays at home to take care of her husband and children.
A deficit of $477 per month
Aside from family allowances of $1,820 a month, the couple has no income. For ten months they had to claim welfare while waiting for François to receive compensation from his insurance company. They also have to use their credit cards, but that’s not enough. The young woman then decides to consult an insolvency expert.
“When she came to me with her spouse, Mariepier told me that she couldn’t do it anymore,” says Marylin Désir, restructuring and insolvency advisor at Raymond Chabot.
In total, her debts total $286,500, including the $225,300 mortgage loan. After deducting expenses, that leaves a deficit of $477 per month.
Because they are new owners, they may not qualify for a home equity loan due to the small amount of equity they have accumulated on their home. Selling the house is not a solution either, as rents have risen so much that looking for an apartment would cost a lot more.
Two proposals over 60 months
Two solutions are available to you: bankruptcy or consumer proposal. “They preferred to avoid bankruptcy because they felt they were too young. “In the event of another financial setback, a second bankruptcy would have a significant impact on their credit report, and for a very long time,” argues Marylin Désir.
So they went with the consumer proposal. An offer is made to the creditors for an amount that is less than the total amount of their debts. This amount does not include the mortgage balance as they want to keep their house. On the other hand, they will sell their financed vehicle. The amount is returned to the seller and the balance is added to the consumer offer.
Marylin Désir advised them to each submit their own proposal and not to mention their two names on it. “In the event of a split, a joint proposal would have been more likely to be challenged by creditors,” she specifies.
your financial situation
Financial assets :
◆ Family residence:
- community value of $257,800
◆ family vehicle
- Dodge Estate: finance
- 2013 Hyundai Accent vehicle: paid
Debts
- home mortgage: $225,300
- car loan: $29,000
- Credit cards and credit (woman): $23,000
- welfare debt: $9500
► TOTAL DEBT: $286,500including $32,500 not secured by property
Monthly income
- Disability Insurance (Sir): $1610
- Allowances for children with special needs (at federal and state level): $1820
► TOTAL REVENUE: $3430
Monthly expenses
- $3907 (including mortgage, taxes, car loan, phone, electricity, gas, groceries, driver’s license and registration, insurance, etc.)