More help needed for Islanders struggling with debt
A Charlottetown Licensed Insolvency Trustee is calling on the federal government to put in place measures to help Islanders facing job loss cope with debt repayment and avoid bankruptcy.
“People are stressed and scared,” said Walter MacKinnon, who is also a vice president at MNP in Charlottetown.
He said one type of call he received recently was from people who made an insolvency proposal that was accepted. The problem is that if someone misses or falls behind on three consecutive payments, federal law requires the proposal to be in default, which could result in reactivation or modification of the proposal or, in some cases, bankruptcy.
MacKinnon said MNP had contacted the Office of the Superintendent of Bankruptcy to see if it was possible to extend the default period from three months to six months — or more. The parties involved in the debt are not allowed to work out their own arrangement under current legislation.
By the numbers
Insolvencies in Canada – 2019
- PEI – 364
- Nova Scotia – 2,855
- Newfoundland and Labrador – 1,761
- New Brunswick – 2,519
- Canada – 83,703
Bankruptcies in Canada – 2019
- PEI – 395
- Nova Scotia – 3,244
- Newfoundland and Labrador – 1,501
- New Brunswick – 2,377
- Canada – 57,155
In some cases, customers are advised to hold payments or pay what they can “because there’s no point in trying to take money that isn’t there”, he said. declared.
The other type of calls he receives are from people without income due to the current economic climate, such as unemployed self-employed people who are not eligible for employment insurance.
MacKinnon’s advice is to speak with a Licensed Insolvency Trustee to review the options.
“We can look at which choices might be the best choice. Maybe we wait for now until we see how long it will last. Maybe it’s a proposal. Maybe it’s bankruptcy,” MacKinnon said. “But don’t do something too quickly without getting the right information.”
The Guardian has contacted the Office of the Superintendent of Bankruptcy to discuss options it is considering to help people struggling with job loss and debt. A response to this request has not been received at press time.