Marie-Andre, 60 years old, self-employed. When she learns she has stage 4 cancer, her world falls apart. Due to her health condition, she stopped working and lost her income.
At first, Marie-Andre dipped into her savings for basic expenses. Each month, she pays about $1,750 for her rent, groceries and other current expenses. But after all her savings were used up, she had to turn to credit. Alone, she unfortunately cannot count on anyone to take care of her and support her financially.
“I can’t work anymore, and since I don’t have disability insurance, I have no income. As a self-employed worker, I don’t even have access to employment insurance. So I’ve taken steps to receive social assistance and hope to receive it soon,” she explains.
Use of food banks
To make ends meet, Marie-Andre used her credit cards. She finds herself today with an accumulated balance of $14,100. To make matters worse, she owes the tax authorities $26,000 in late taxes.
Struggling with debts totaling $41,300 and unable to pay off, she was forced to turn to food banks and charities.
Trying to find a solution to reduce her financial stress level and focus on her health, she decided to contact a licensed bankruptcy trustee firm.
There is no other option but bankruptcy
Patricia Roy, senior adviser in economic recovery at Raymond Chabot, handled Marie-Andre’s file. “Above all, she was looking for peace of mind and wanted to leave with peace of mind. In her situation, the best solution is bankruptcy,” she said.
Marie-Andre has previously declared bankruptcy twice, so the process will be long and complicated. “Her bankruptcy will be extended for 36 months instead of nine months and she will not be automatically discharged as in the case of the first bankruptcy. She will have to go to court for discharge,” stated Patricia Roy.
However, as soon as the bankruptcy is filed, the accrual of interest stops and any possible actions by the creditors are suspended. All of Marie-Andre’s debts, including her tax debts, were included in the bankruptcy.
“Unfortunately if she dies before the bankruptcy is completed, in which case, her estate will have the option of rejecting or accepting it,” the adviser states. If the estate has more debts than assets, it is possible to write off the deceased’s debts to avoid inheriting them.
Patricia Roy concludes by reminding us that when you’re self-employed, it’s important to have disability insurance. This can be a great financial help if health problems prevent us from working.
Its financial condition
· Dodge Caravan 2007: Value $750
· Store card: $13,800
· Credit Card: $300
· Provincial tax: $22,000
· Federal tax: $4,000
Total debt: $41,300
· Waiting for social assistance
Total Income: None
· $1,748 (Including rent, telephone, electricity, insurance, grocery, gas, license and registration etc.)