Would like some advice


Good evening. I am trying to figure out if you can provide some feedback to my husband and I with our current situation.
We have a large amount-approx $80,000 in credit card debt. We have had 2 of our children get married in the last 2 years and things are rather tight financially. We pay minimum payments every month to all cards. The total of these payments is approx. $2700. I do know that I am paying a lot to interest and therefore am interested in consolidating to reduce the financial strain.

Our situation is such that we are hoping to sell our home in the next couple of years but my husband’s parents live with us and therefore we cannot afford to move to our retirement home until our house in Bolton is sold. We cannot sell the house from under them but it is becoming increasingly difficult to manage payments on 2 homes-cottage up north/retirement home as well as the credit card payments. We know that once the house is sold, we will be both mortgage free from the Bolton house as well as credit card debt free. Therefore, it is a waiting period right now.

My husband receives a monthly settlement amount as well as CPP Disability payments due to a car accident 10 years ago. He cannot work and lately his health has not been good and the stresses of debt are not helping. I am employed part time-25-30 hrs per week. Due to his health, I cannot work any more than that. We see the light at the end of the tunnel but are hoping that we can do something to reduce the financial strain right now. I have not missed many monthly payments-late on a couple due to hubby being in hospital and forgetting to go to the bank.  We do want to eliminate most of our cards but do require a couple due to points programs etc.

Some additional information – Bolton property assessed at $725,000, cottage $500,000- according to mortgage companies. Mortgage 1 is $456,000 and Mortgage 2 is $390,000-my son is joint on this and pays $1,500.00 a month for it until my husband’s pension kicks in next year. Monthly CPP is $1,114.47 and the structured settlement amt is $2,945.31 per month. My income is $750.00 net biweekly.

Can you provide some feedback on what we can do? Thanking you in advance for your anticipated consideration.

Category: asked November 28, 2013

1 Answer


Hi Kerry,

You have a lot of equity in these 2 properties. I figure that if you sold just one of them, you’d be able to easily clear up your credit card debt. But you’re unable to, for reasons you stated previously.

I cannot help you since you must be insolvent (i.e., value of assets < value of total debts) to qualify for a debt consolidation under a consumer proposal. A consumer proposal is a legal proceeding and the insolvency criteria must be strictly met. You actually have a net worth of $299,000 ($725,000+$500,000-$456,000-$390,000-$80,000).

However, since you live close to the GTA, you can contact a credit counselling agency called Credit Canada (www.creditcanada.com). They could put you on a Debt Management Plan. This will allow you to pay off all your debt over 60 months and they may be able to get a reduction in the interest. Unlike a consumer proposal, you’ll have to pay off the entire $80,000.