Personal Bankruptcy&Consumer Credit Counseling - Edmonton Alberta Canada

There are income qualifications that must be met before you are accepted into the program. This program is not a government funded program.

Phone (780) 423-5265

This program requires you to pay 100% of your unsecured debts together with interest of 5% from the date of the order. These payments can be over an extended period, not exceeding four years. If you also have debts for Student loans, they are able to incorporate the Student loans if your cash flow will support the repayment.

Basically in exchange for a debtor agreeing to consent to a judgement in favor of the creditors, the creditors agree to accept monthly payments and limit interest to five percent. There is now a small monthly administration fee payable by debtors who choose to take advantage of this service.

Again your cash flow and your ability to make the payments are important factors for you to consider. If you get into an orderly payment of debts payment scheme and then are unable to make your payments, your creditors will be able to use the consent judgement that you signed to garnishee your wages or seize your non-exempt assets without further notice or Court actions against you. You will not be able to dispute the amount owed to the creditors.

We have seen several cases where individuals have made payments under this program for years and then have to seek bankruptcy protection because they can no longer afford to make the payments under the program.

Orderly Payments of Debts is the only option that can be used to deal with Student Loans that are less than 10 years old. All of the other options, including bankruptcy cannot help you relieve the burden of such loans.

Orderly Payment of Debts is preferable to other alternatives when there are large amounts of student loans or the amount of unsecured debt is not significant.

Remember: all methods of dealing with your creditors on a negotiated basis will affect your credit rating significantly. If you have creditors calling you about your debt, it is very likely that your credit rating has already deteriorated.

If you decide to proceed with Orderly Payment of Debts, it is quite likely that your credit card suppliers will request that the cards be returned or demand proof that they have been destroyed. If by chance, you are left with credit cards, you should put them aside and not use them until after you have completed your payment program. Credit is not income and should not be treated as such.

Debtors filing with Orderly Payment of Debts should realize that their creditors pay Orderly Payment of Debts for the collection of their debts. It is interesting to consult the web site for Credit Counselling Services of Alberta to determine just how much this "not for profit" corporation gets paid to collect your debts by your creditors.

On the audited statements for the year ending December 31, 2003, the company administering the Orderly Payment of Debts Program received $1.8 million from creditors on distributions of $9.2 million or almost 21 percent! The statements show that this corporation has accumulated “earnings” of almost $1.2 million.

The interest rate of 5% may be less than the interest that you are currently paying.
Payments can be made over a period that can be tailored to your own cash situation.
It is a reasonable to deal with a small amount of debt where creditors refuse to take payments and are threatening to garnishee or already have garnisheed.
OPD may stop some creditors from taking further action against you.

Obligations for alimony, child maintenance or payments to secured creditors are not altered.
Real effort must be made to repay over 3-4 years.
Even though the creditors will receive a greater distribution form OPD than from a proposal or a bankruptcy, some credit agencies consider OPD processing no different from bankruptcy proceedings. There is no different credit rating than for a proposal under the Bankruptcy and Insolvency Act. The negative report about filing a four- year OPD repayment scheme will remain on your credit report longer than a bankruptcy.
Taxes or tax reassessments may make it impossible for you to fund your proposal.
Creditors still have the right to garnishee wages or seize your assets if any payments are missed without any further notice to you.
It is considerably more expensive than bankruptcy and usually more expensive than a proposal.