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COVID-19 and your creditors

During this pandemic, many people and businesses are facing increasingly desperate times. The government has introduced measures to assist individuals and companies to try to weather the storm.  What happens if you don’t qualify or unable to raise the necessary funds to pay your debts as they become due?


At S. Funtig & Associates, we are here to help. We want you to know that there are options both for you personally or for your business.  These options may range from lending an ear and providing business advice to assisting in filing a proposal to give you or your business time to recover while you or your business get back to work.


Here is the legal part, this blog is not designed, nor in the space available, can we set out all conditions, exceptions or possibilities.  Once you read this blog, you should contact one of our offices near you or contact a local trustee near you for greater analysis and review of your particular circumstances.  For ease of reading, we will try to create a series of short blogs written for ease of reading and avoiding lots of legal jargon.


During this time, many creditors are willing to help.  In some cases it may be rent forgiveness or deferral.  For property owners many municipalities are deferring property tax payments.  In other situations, hydro rates are reduced.  Many banks are deferring for up to six months payments on mortgages, credit card and auto loans.  Some auto companies are providing similar deferral periods.  However, if you do ask and get a deferral, ask what terms or conditions are attached, in some cases, interest may be added for the deferral due to the longer repayment period.  In short call your creditors and discuss your situation, simply unilaterally deferring or skipping a payment may hurt you if not agreed and documented by your creditor.  As with all financial transactions, having documentation in the form of a letter agreement or email can assist down the road.


In addition to the assistance offered by your creditors, the government has extended the deadlines for filing tax returns for individual to June 1, 2020 and has suspended payment obligations on certain tax debts to later in the year.  As this is a fairly technical point, you should consult the Canada Revenue Agency website for guidance on those relief measures.


What can you do, on our website we attach a simple income and expense worksheet that you can download.  Reviewing your monthly income and expenses and identifying those expenses that can be deferred can assist in determining what funds you need to meet your living costs.  Now is the time to cut back on those wants and focus on needs for you and your family.  Remember deferral of payments is not forgiveness, at some point in time in the future they will need to be paid.


For the short term, focusing on your immediate needs is important.  In some cases you may continue to receive calls from debt collectors.  Remember at this time the court system is essentially closed and creditors may not have the ability to issue a statement of claim at this time.  In the future, if necessary, contact our office for a free no obligation consultation to help you determine what options you have available.


There are a number of factors and implications to address when making decisions concerning a proposal, at S. Funtig & Associates we are here to help and can schedule a telephone or video conference call or arrange to meet with you respecting the need for social distancing.


Remember the people of Chatham and Windsor are strong, we will get through this together!

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