Marie-Andrée, 60 years old, is self-employed. When she finds out she has stage four cancer, her world collapses. Due to her health condition, she has to give up her job and has no income.
At first, Marie-Andrée dipped into her savings to cover basic costs. Every month she has to pay almost $1,750 for her rent, groceries and other ongoing expenses. But when all her savings were used up, she had to resort to loans. Unfortunately, since she is single, she cannot rely on anyone to take care of her and support her financially.
“I am no longer able to work and since I had no occupational disability insurance, I do not receive any income. As a self-employed person, I also have no access to unemployment insurance. That’s why I’ve taken steps to get social assistance and I hope to get it soon,” she explains.
Use of food banks
To cover her needs, Marie-Andrée used her credit cards. She has a total balance today of $14,100. To make matters worse, she also owes the tax authorities $26,000 in late taxes.
Unable to make ends meet and struggling with insurmountable debt totaling $41,300, she had to resort to food banks and charities.
Looking for a solution to reduce her financial stress and focus on her health, she decided to contact a licensed insolvency practitioner firm.
No choice but bankruptcy
Patricia Roy, senior financial recovery advisor at Raymond Chabot, handled Marie-Andrée’s file. “Above all, she was looking for peace of mind and wanted to be able to go home with peace of mind. “In her situation, bankruptcy is the best solution,” she says.
Since Marie-Andrée has already filed for bankruptcy twice in the past, the process will be longer and more complex. “Her bankruptcy will last 36 months instead of nine months and she will not be automatically discharged, as in the case of a first bankruptcy. She has to go to court to get her released,” explains Patricia Roy.
However, as soon as the bankruptcy application is filed, interest no longer accrues and any creditor proceedings are suspended. All of Marie-Andrée’s debts, including her tax debts, are included in the bankruptcy.
“If she unfortunately dies before the bankruptcy is finalized, in this case her estate will have the choice of rejecting or accepting the bankruptcy,” specifies the advisor. If the estate has more debts than assets, it is possible to have them forgiven to avoid inheriting the deceased’s debts.
Finally, Patricia Roy reminds you that it is very important for self-employed people to take out occupational disability insurance. This is a great financial help when health problems prevent us from working.
HIS FINANCIAL SITUATION
Active:
· 2007 Dodge Caravan: Valued at $750
Consumer debt:
· Loyalty Card: $13,800
· Credit card: $300
· Provincial tax: $22,000
· Federal tax: $4,000
TOTAL DEBT: $41,300
Monthly income:
· Waiting for social assistance
TOTAL REVENUE: NONE
Monthly expenses:
· $1,748 (including rent, telephone, electricity, insurance, food, gas, license and registration, etc.)