Bankruptcy
A process which legally discharges most unsecured debts.
Consumer Proposal
A formal offering, usually less than 100 cents on the dollar, to settle outstanding debts.
Creditor
A person or company to whom you owe money.
Creditor Negotiation
Negotiating repayment plans or settlement offers.
Debt Pooling/Consolidation
Adding all unsecured debt together and using the total to calculate the repayment or settlement offer.
Debtor
A person or company who owes money.
Garnishment
When a creditor obtains a judgement against you, they can attach to your wages, requiring your employer to forward payment directly to them. Canada Revenue Agency does not need a judgement to garnishee wages.
Insolvency
The act of being insolvent – being unable to meet your obligations as they become due.
Mediation
A process under the Bankruptcy and Insolvency Act where creditors and debtors can negotiate disputed matters regarding payment ability.
Orderly Payment of Debts
A program through Money Mentors which consolidates all debts. You make one monthly payment to Money Mentors and they pay your creditors 100 cents on the dollar plus judgement interest of 5%.
Unsecured Creditor
A person or company to whom you owe money, who does not hold any collateral as security for the loan, (ie. Bank holds house as security; bank holds car as security for car loan, etc.).