The Rebecca Martyn Bankruptcy Windsor Blog

Consumer proposals have become increasing popular since we opened our Windsor office in 2003. Each year I have seen an increasing number of filings in Windsor and surrounding area. Since Hoyes, Michalos first opened its doors in 1999 we have maintained a database of creditor voting patterns and we have noted some very interesting recent voting patterns.

I can’t name names because I could get sued, but I want to share some examples of recent votes. Big Bank A recent voted against a consumer proposal and would not accept any counter offers. They stated they voted against the proposal because the debtor’s debts were too low (his total debts were $16,000). In another example, Big Bank B voted against a consumer proposal with a rate of return of 21% and they made a counter offer with a rate of return of 27%. In both cases there were sufficient other votes for the consumer proposals that they both passed even without Big Bank A and B’s support.

The logic of some of the voting is strange to say the least. The debtor has offered a consumer proposal with a reasonable rate of return and a rate of return far greater than a bankruptcy. In many cases when a consumer proposal is rejected the debtor has no other option but to file for bankruptcy. It doesn’t seem logical that a creditor would reject something that would pay money.

In 2008 (the latest year statistics are available), Hoyes, Michalos filed 8% of all of the consumer proposals in Ontario. Keep in mind that this includes regions we don’t even have offices in. We estimate that if we only include the regions where we have offices, our firm filed 25% of all of the consumer proposals filed.

What does this mean? If you are looking to file a consumer proposal you want to be dealing with someone who has extensive experience in this area. You want to hear about creditor voting patterns to make sure your are offering a consumer proposal that is fair to both you and your creditors.

Call me at 310-PLAN or 519-250-8060 or email me and we can review your situation and formulate a consumer proposal that is right for you.

As a Bankruptcy Trustee in Windsor, I am often asked why I don’t do corporate work. For many Trustees corporate work is seen as the interesting work and the work that gets the attention. Well, the attention part can be true. There have been a number of high profile companies file for bankruptcy recently in Windsor and this can attract some media attention. I noticed two such articles in the local paper last weekend. The interesting note for me is our phone lines increase when this happens. As someone who used to work for a national firm this doesn’t surprise me. Someone may have called one of these firms and set up an appointment to discuss options to their personal situation. They book the appointment but then the trustee they were supposed to meet with starts working on a corporate file. What happens next? You guessed it – the personal appointment gets cancelled in favour of the corporate file.

That same person then calls Hoyes, Michalos, meets with me and we review the options in detail. They were stressed and annoyed that their meeting at another firm was cancelled, but now they are happy to know the options available to them.

It is important to meet with someone and review your options when you are having financial trouble. You can call me at 310-PLANto set up an appointment.

Doug Hoyes, of Hoyes, Michalos and Associates Inc. did an interview with Business News Network on August 12, 2009. You can watch the interview on the BNN website. He explained the new bankruptcy rules and how a bankruptcy may last longer if you have surplus income.

Doug spoke about alot of same things I deal with everyday in Windsor. A person unexpectedly loses their job and uses their credit to pay for day to day essentials as they look for new employment. As the bills pile up, the person might be left with the prospect of filing for bankruptcy .

Our message is the same to everyone we meet. The bankruptcy rules are changing and it’s best to be informed now so you can decide if it is better to file now or to wait.

For more information, contact our office at 310-PLAN and arrange a meeting, and we’ll help you with a plan that is best for you and your family.

I receive numerous emails to my office in Windsor asking who we, as Trustees, work for. In addition, there are numerous for-profit counselors advertising stating “don’t go see a Trustee, they work for your creditors” (if you have been following my blog you can read more about for-profit counselors).

Trustees are appointed by the Office of the Superintendent of Bankruptcy to help you with either a bankruptcy or a consumer proposal. Yes, you pick the Trustee and yes you pay the Trustee to help you, but the Trustee does not work for you. Well then, you must be thinking that we work for the creditors. No, we are here to make sure both parties, the debtor and the creditors, are following the rules.

Let me give you a few examples. I am not using anyone’s real name.

Sue filed a consumer proposal with me. After the date of filing, Credit Union X took money from her pay cheque. We advised the credit union that they had to give the money back and they refused. Although the money in question was around $200, the point is that the credit union was violating the rules by not returning the money. I arranged a court date and the Credit Union finally agreed to return the money. That doesn’t sound like I was working for the creditor does it?

Robert filed for bankruptcy and was due to be discharged later this week. He hasn’t made the payments he was required to make based on his income. As a result he is not getting his discharge as scheduled and will have to pay the required payment in order to get out of his bankruptcy.

When you are in financial difficulty and need advice it is important to feel comfortable with the person you are dealing with. If you were uncomfortable at your meeting, you always have the option to see someone else before you sign any papers.

Call me at 310-PLAN or email me and I will explain all of your options to you.

Guest post by Douglas Hoyes, colleague of Rebecca Martyn, and co-founder of Hoyes, Michalos & Associates Inc.

As a frequent visitor to Windsor over the past 15 years am I always amazed at the many changes that continue to happen. I’ve watched as all of the “Big Box” stores have appeared on Walker Road by the 401; it seems that you can buy anything you want, and buy it in a big store. The massive re-development of the Ambassador Bridge, which is still in it’s initial stages, will enhance the movement of traffic to and from the United States, but will obviously cause changes in Windsor as well. And of course the upheaval in the auto industry has changed Windsor forever.

Speaking of upheaval, there is certainly a lot of uncertainty in Windsor. I spent today in our Windsor office, meeting with people who worked for the same employer for many years, only to be laid off over the last few months due to the downturn in the economy. They had good jobs, and now they are forced to survive on unemployment insurance. For three of the people I met with today they have also gone through a marriage separation. I’m not a psychologist, but I suspect that the stress of the job losses and economic uncertainty is affecting people in many ways.

The automotive uncertainty is hurting, and the various strikes by city workers and taxi drivers also seems to be contributing the the depressed mood. There is a feeling of hopelessness with many of the people I met with today. If I had to summarize the mood of many people I met with today in our Windsor bankruptcy office, that would be it: uncertainty and hopelessness. They don’t know when, or if, things will get better, and they don’t know what to do.

That feeling of hopelessness is made worse by the fact that 2008 was a record year for personal bankruptcies, and 2009 will probably set another record. According to bankruptcy statistics just released by the Office of the Superintendent of Bankruptcy, in the first quarter of 2009 personal bankruptcies in Windsor increased by 38%, and the number of consumer proposals filed increased by almost 46%. In total personal insolvencies increased by almost 40% in Windsor in the first three months of 2009.

The growth rate in personal bankruptcy is accelerating, since it was up 37% over the last twelve months.

In the twelve months ended March 31, 2009, 1,839 Windsor residents declared bankruptcy, and a further 534 people filed a consumer proposal.

Those are scary numbers, but they are just numbers. What does this mean for the people of Windsor with financial problems?

First, understand that you are not alone. In the last three months almost 700 residents of Windsor have filed bankruptcy or a consumer proposal. If you work in the automotive industry, or virtually every other industry in Windsor, business is slow, leading to cutbacks in hours and wages, and frequent layoffs. That’s not your fault.

Second, the bankruptcy numbers continue to increase, so we should all prepare for more problems over the next few months. Read my five tips to survive the recession to learn some practical steps you can take to deal with your debts.

I’m a big believer in having a “Plan B”. What would you do if you lost your job, or if your hours were reduced at work? Many people are picking up a part time job now, so that if they lose their full time job at least they will have some income. Cutting expenses is also critical. If you lower your expenses, you don’t need as much income to survive. Now may be the time to cut all non-essentials.

If you have debt, pay it off. Start by paying off your highest interest rate debts first, and use the interest savings to pay off your other debts faster.

What can you do if you already have more debt than you can handle? There are options. Credit Counselling in Windsor is an option. If you can’t afford that, a consumer proposal or a bankruptcy may be necessary to deal with your debts. There are options, but we can only create a plan for you if you give us a call in Windsor at 519-250-8060, or at 310-PLAN (no area code required), or e-mail us today to arrange for a no charge initial consultation where we will review your options for dealing with debt. The statistics prove that now is the time to take action to deal with your debts.

There is hope, so give us a call, and let’s get started.

Last article I wrote about for profit credit counselors and their fees. This time I would like to write about consultation fees some Trustee’s charge. I would also like to share a few of their stories about the meetings they have had with other Trustee’s.

I was scanning the Windsor yellow pages and noted that none of the advertising Trustees state that they charge a fee to meet with a new caller. However, when I speak with new callers on the phone I am hearing something different.

If you call a Trustee, ask if there is a fee to meet with them. If there is you should be calling us. We don’t charge for the initial consultation or follow up meetings if required.

I have also heard stories that some companies won’t even meet with you unless you first complete a lengthy application form and send it in first. Again, this is not necessary. Simply gather information about your debts and bring them into our office. I will even help you complete our “fresh start” form.

I have met with people who have come to us to seek a second opinion. They have met with a trustee who focusses on bankruptcy, when the person doesn’t want to file bankruptcy ; he or she wants to file a consumer proposal.

At this point they come to us for a meeting because they want to talk about all of their options, not just bankruptcy. In many cases they left all of their personal paperwork with the Trustee and now the Trustee wants money to return it to them. This is your paperwork and you shouldn’t have to pay to get it back. If you find you are in this situation, you should advise the Office of the Superintendent of Bankruptcy. If the Trustee didn’t tell you about a fee to meet with them, they shouldn’t be charging you to give you back your paperwork.

If you are unsure about dealing with the person you met with, don’t leave any of your paperwork with him or her. The same principle applies to paying a for profit credit counselor a meeting fee as paying a Trustee a meeting, you can speak with me at no charge, so why meet with someone who will charge you money to speak with them?

Call me at 310-PLAN or email me and I will be pleased to discuss your financial situation with you.

On February 4, 2009 Ted Michalos was interviewed by the Globe and Mail. The article got a huge response, so the Globe and Mail asked Doug Hoyes to participate in a “live chat” event. Readers were invited to send in their questions about personal bankruptcy in Canada, and Doug gave them instant answers to their questions. The reporter e-mailed Doug the questions, and he typed his answers and e-mailed them back. The readers asked some really good questions and we were told that the Globe and Mails servers had a hard time keeping up with the demand.

The questions illustrated the wide range of financial problems people have, and Doug was happy to share the wide range of solutions that are also available. You can read all of the questions, and his answers, in the Globe and Mail’s article on what you need to know about bankruptcy. If you didn’t get your question answered, please e-mail us your questions now, and our team will respond as quickly as possible.

Ted Michalos was also hard at work on Wednesday, doing a live interview on BNN, the Business News Network. You can watch Ted discuss the five things to consider before filing bankruptcy on the Hoyes, Michalos bankruptcy video page.

I suspect you will see Ted and Doug, and the other trustees of Hoyes Michalos, on the radio, on television, and in the newspaper frequently over the next few months. The media’s job is to cover the issues that matter to Canadians, and at the moment there is nothing more important to most Canadians than the state of our economy. Many of us have more debt than we can handle, and the media is looking for people that offer solutions. I am proud to be a member of a firm that has a great reputation, which is why the media calls on us for comments.

The good news for you is this: you don’t have to wait for us to appear on TV, and you don’t have to submit your question to a newspaper to get an answer from our experts. Simply contact us today, by phone at 310-PLAN or by e-mail, and we will answer your questions, tell you your options, and help you get a fresh start.

Many visitors to this blog are experiencing a problem with a collection agency. On our website hoyes.com you can read the letter of direction issued by a Registrar with the Ministry of Small Business to the collection agency industry in Ontario.

I have seen many people who have received a document that looks like a court order but with the word “draft” in the corner. This is done to appear that the collection agency was about to start legal action. However, this is just a form letter designed to scare the debtor into make a payment.

If you have received such “draft” letters or letters from lawyers that don’t identify who they are working for you should contact the following government office:
Consumer Protections Branch
5775 Yonge Street, Suite 1500
Toronto, ON M7A 2E5
Tel: 416-326-8802
Toll free: 1-800-889-9768
Fax: 416-326-8810

By sending copies of your letters to the government you will help to clean-up this deceptive practice on the part of collection agencies. This number can also be used for any other complaints or concerns you may have about collection agencies in general.

The reality is that if you have collection agencies calling you, you should speak with a professional about dealing with your debts. We can arrange a no charge, no obligation meeting to meet with either myself or Catherine Ouellette. In many cases, we will tell you that filing for bankruptcy or a consumer proposal is not the best option and we can refer you to a credit counsellor.

Call our office at 310-PLAN or email me to review your financial situation.

Occasionally I hear from people who considered filing for bankruptcy or consumer proposal and came to our office for a second opinion after meeting with another company.  More often than not, they come back to Hoyes Michalos when they are ready to make a decision to file.

One reason they come back to us is because when you call Hoyes Michalos during office hours you can always reach a live person to assist you.  I may be in meetings when you call, but there we have a large staff ready to help answer your questions.   No one likes being put through to someone’s voicemail and we pass that philosophy on to our callers.  I have been told of a bankruptcy firm that advertises “talk to me anytime”, but every time you call you get an answering service that can only take messages.

Another reason callers come back to us is our flexible hours.  We know many people work 9 – 5 so it makes sense to us to allow evening and weekend appointments to accommodate your work schedule to the extent possible.

When you meet with someone in our office you always meet with a Trustee or with someone training to be a trustee.    We have the training to be able to answer your concerns immediately.  When you come to Windsor, Leamington or Chatham you will usually meet with me.  If I am not available, another trustee or a trustee in training will meet with you.

If you would like to meet with me to review your situation, call me in Windsor at 519-250-8060 or 310-PLAN or email me.