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In statistics just released by the Office of the Superintendent of Bankruptcy, 1,319 residents of Brantford filed a consumer proposal or personal bankruptcy in 2009. In the City of Brantford there were 701 filings, and in rural Brantford, including Caledonia, Delhi, Dunnville, Paris and Simcoe there were a further 618 filings. That's an increase of 38% from last year. Ontario was up about 32%, so Brantford fared slightly worse than the rest of the province. The attached postal code map shows where each bankruptcy occurred. Not surprisingly, more bankruptcies happen where more people live, in the center of the Brantford. (We assembled this map based on our analysis of filings by postal code; the government does their math slightly differently, and they calculated 822 filings in Brantford and some of the outer areas, for a total increase of 40% for the year).
Why are bankruptcies are up to record levels in Brantford? There are two reasons: First, we are in a recession. Unemployment is high, and when you are out of work it's harder to pay your debts. Second, residents of Brantford, and in fact in all of Canada, are carrying record levels of debt. Canadians are carrying household debt of 140.8% of their personal disposable income, the highest level in history. This means that for every dollar a Canadian earns, they have $1.41 in debt. Two years ago Canadians carried "only" $1.28 in debt for each dollar earned. When debts are high, bankruptcy rates rise. Interestingly, Of those 1,319 people who filed last year in Brantford, 960 filed bankruptcy, and 359 filed proposals. In other words 27% of Brantford residents filed a proposal last year, the highest percentage on record. A consumer proposal is a deal made with creditors to avoid bankruptcy. Last year in Brantford my firm, Hoyes, Michalos & Associates, filed more than a third of all consumer proposals filed in Brantford, making us the largest filer of consumer proposals in the area. In a typical proposal you may pay back about a third of your debt, so if you owe $40,000 on credit cards and loans, you may pay $300 per month for four years, and once completed your remaining debts are discharged. It's a great way to avoid bankruptcy. So why are more residents of Brantford filing proposals? One reason is that the government of Canada changed the bankruptcy rules on September 18, 2009 when new bankruptcy rules came into force, increasing the cost and length of a bankruptcy for bankrupts with surplus income. The debt limit for eligibility to file a consumer proposal was increased, increasing the attractiveness of a consumer proposal as a debt management option. In other words, a bankruptcy is now more expensive for some people, making a consumer proposal an even better alternative. What will happen in 2010? If the economy recovers, the number of bankruptcies filed in Brantford may fall. However, if the economy recovers, it is likely that interest rates will increase, and if the cost of carrying debt goes up, more bankruptcies may result. So what's my advice? Excessive personal debt is a ticking time bomb, and unless residents of Brantford take steps to deal with their debt, an increase in interest rates or a further reduction in employment will lead to a continued trend of higher personal insolvencies. For many people this recession is the first time in their lives they have experienced debt problems, and they don't know where to turn for advice. They are embarrassed to talk to family or friends or co-workers. Unfortunately many debtors are now turning to unscrupulous debt consultants, who charge a fee and then simply refer the debtor to a bankruptcy trustee. We strongly urge debtors to investigate their advisors before paying anything. Confirm that they are licensed by the federal government, or a provincial agency. At Hoyes, Michalos & Associates we do NOT charge any up-front fees; no reputable trustee charges an up front fee. More information is available in this article on Debt Consultant Scams. If you are having debt problems, please call my office in Brantford at (519) 770-4440 or 310-PLAN, or contact me by e-mail, and we will review your situation and help you make a plan to deal with your debts; we will do our best to help you avoid becoming a Brantford bankruptcy statistic. Labels: bankruptcy Brantford, bankruptcy statistics Brantford
As a follow up to my blog post about a record month for bankruptcy in Brantford, an interesting article appeared yesterday on brantford.com. The article, part of their series on Tough Times, discussed the record rate of increase in personal bankruptcies in Brantford. I liked the article because rather than emphasizing the bad news, the articles authour, Jennifer McCarthy, explained the options I discuss with everyone to help them deal with their debts.
I believe bankruptcy may be necessary, but it should not be considered until you have looked at your other options:
For an interesting discussion of the pros and cons of bankruptcy, Greg McMillan wrote and interesting article asking whether or not residents of Brantford are jumping the gun by filing for bankruptcy?
Each situation is different, so if you have questions about your situation, call my Brantford office at 519-770-4440, or e-mail me to set up a free initial consultation.Labels: bankruptcy Brantford, bankruptcy statistics Brantford
 I hate to be the bearer of bad news, but June was a record month for the number of personal bankruptcy and consumer proposals filed by my firm in Brantford. Since we opened our Brantford bankruptcy office in 1999, we have never had a busier month than we just finished. In fact, our volume in June, 2009 was more than twice as high as it was in June, 2008. The bad news for Brantford residents is that June is not normally a busy month; we are usually busy in March, April and May, and then as the summer approaches we slow down. Not this year. Our Brantford help line is busier than ever, with no slow down in sight.
Why is this happening? First, more people in Brantford are losing their jobs, or having their hours reduced at work, so they just can't make ends meet. Second, house prices continue to fall in Brantford, so it's no longer possible to re-finance your house to pay off your debts, or sell your house at a profit to raise cash. An increasing number of Brantford residents are finding themselves "under water" (the value of their house is less than the amount owing on the mortgage), so they are letting the bank foreclose, and they are finding a place to rent, and then dealing with the resulting shortfall. Finally, a large number of the people I meet are no longer optimistic. They believe that the recession won't end tomorrow, so they are deciding to go bankrupt now to deal with their debts, in the hope that by 2010 the economy has improved, and they will have a fresh start. I can't predict when the recession will end, or when house prices in Brantford will start to increase, but I can tell you that debt problems don't go away on their own, so if you are struggling with debt, now is the time to act. Call my Brantford bankruptcy office at 519-770-4440 or 310-PLAN (no area code required), or e-mail me today with your questions, and let's get started making a plan for dealing with your debts. Labels: bankruptcy Brantford, bankruptcy statistics Brantford
 Each week I meet with about a dozen people in my Brantford bankruptcy office. The Office of the Superintendent of Bankruptcy released statistics this morning showing that personal bankruptcies are on the rise in Brantford.
In the first three months of 2009 there were 125 residents of Brantford that filed bankruptcy, and a further 47 people filed a consumer proposal. That's a total of 172 filings, as compared to 124 filings during the same period last year.
That means that personal insolvencies in Brantford increased by 38.7% in the first three months of this year.
How does that compare with the rest of the province?
Brantford's insolvency rate increased by a similar amount to Kitchener (36%), Toronto (39.9%)Windsor (39.5%) and fared much better than Hamilton (47.2%) and London (62.5%).
The Ontario rate was up by 40.7%, so Brantford fared slightly better than the entire province. In Canada consumer insolvencies increased by 35.9%, so Brantford was slightly worse than the national average.
However, the statistics only tell part of the story. In the last week I've met with a number of people in Brantford who are worried about losing their home, and they are worried about further job losses. The numbers are bad now, and they worry they may get worse. My message to them is that there is help available, so if you don't want to be a statistic, give my office in Brantford a call at 519-770-4440, or send me an e-mail, and let's talk about ways to deal with your debts so you can avoid becoming a statistic.Labels: bankruptcy statistics Brantford
 After experiencing a decline in the personal bankruptcy rate in Brantford in 2005 and 2006, the number of personal bankruptcy filings in Brantford increased by 13% in 2007. In total, 384 residents of Brantford went bankrupt in 2007.
In addition, a further 112 Brantford, Ontario residents filed a consumer proposal in 2007, a 12% increase from the 100 people in Brantford who filed a consumer proposal in 2006.
While the unemployment rate declined slightly in 2007 in Brantford, employment growth was a tepid 1%. Similar to other communities in Ontario, Brantford has lost higher paying manufacturing jobs and replaced these with lower paying service jobs. In early 2007, Genfast Manufacturing Company was just one company to close resulting in the loss of 210 jobs in Brantford. In August, Canadian Blue Bird closed affecting a further 130 manufacturing jobs. The list of plant closings also included Easton Coatings, Dura Automotive and Kester Canada.
By way of contrast, personal bankruptcies increased by 5.2% in all of Ontario, and by only 0.7% in all of Canada, so obviously Brantford has been hit harder than other cities in Canada.
If you have lost your job, or had your hours cut back at work, or if you are just faced with more debt than you can handle, please call me in Brantford at 519-770-4440, or e-mail me to set up a meeting to review your options, and let me help you find a solution to your debt problems.Labels: bankruptcy Brantford, bankruptcy statistics Brantford, consumer proposal Brantford
In statistics just released by the Superintendent of Bankruptcy, the number of personal bankruptcies filed in Brantford in the first six months of 2007 was 198, a 21% increase over the 163 Brantford residents who filed personal bankruptcy in the first six months of 2006.
This compares to a 5% increase in the rate of personal bankruptcy in Ontario, so Brantford's increase was much larger than the Ontario average.
From January to June of 2007 55 Brantford residents filed a consumer proposal, as compared to 52 people in the same period last year, for a 6% increase. A consumer proposal is an alternative to bankruptcy, where you make payments to your creditors over a period of time, usually for less than the full amount owing. (So far this year I have filed about 40% of all consumer proposals filed in Brantford, so if you want more information, please give me a call).
I am starting to see signs of a weakening economy in Brantford. I have helped many more people this year than last year, and as interest rates rise I suspect the trend will continue.
If you want a fresh start, feel free to call my office in Brantford at 519-770-4440, or e-mail us to ask your question or set up a free initial consultation to review your options. Don't let your financial problems get out of hand; there is help available, so feel free to call. Labels: bankruptcy Brantford, bankruptcy statistics Brantford, consumer proposal Brantford
The bankruptcy rate in Brantford fell in by 6.2% in 2006, due largely to employment growth of 2.0%, and an unemployment rate that fell to 6.3%, the lowest level in four years. In 2006 341 people filed for personal bankruptcy, and a further 100 people filed a consumer proposal.
The decrease in the personal bankruptcy rate in 2006 was the largest annual decrease in the bankruptcy rate in Brantford since the 8.4% drop recorded in 2002. Unfortunately in 2003 the bankruptcy rate increased by 17.9%, the largest increase in many years. Will we see an increase in the bankruptcy rate in 2007, like we saw in 2003?
Probably not. As new employers move to Brantford the employment picture should remain positive, so I predict very little change in the personal bankruptcy rate in Brantford in 2007.
Of course just because bankruptcies are down does not mean that people don’t get into trouble. If you are in financial difficulty, you are not alone. In 2006 441 people in Brantford filed a consumer proposal or a personal bankruptcy, so if you want help, please e-mail me a question or call our Brantford office at (519) 770-4440 to book a no-charge initial consultation, and let’s get started.Labels: bankruptcy Brantford, bankruptcy statistics Brantford, consumer proposal Brantford
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If you're having financial difficulties and live in the Brantford area, call (519) 770-4440 today to meet with one of our experts, or complete the ask a question form to send us a message and we'll get in contact with you.
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