How to Get Help with 407 Debt: Bankruptcy, Consumer Proposal and More
If you live or work in or around the Greater Toronto Area (GTA), there’s a good chance that you spend a lot of time commuting. Traffic in the GTA can be very busy, so a lot of people use the 407 ETR toll road to get around. Unfortunately, this convenience comes with a cost. 407 bills can be very high, especially if you use the highway often. This can mean trouble with 407 debt.
Debt problems are difficult to deal with. The more you owe in debt, the less money you have for life’s expenses. You also wind up spending a lot of money paying off interest charges and penalties, which means even less money for the rest of your costs. You could also wind up dealing with calls from creditors and collection agencies, which is stressful and can lead to anxiety and depression. If you have 407 debt, you could even have trouble renewing your license plate when the time comes.
If you are struggling to make ends meet, dealing with 407 debt, or faced with other financial issues, know that options are available.
407 Debt and the Bankruptcy and Consumer Proposal Processes
If you have a large amount of debt, it could feel like there is no solution. However, the reality is that there are options out there to help people who are unable to pay off their debts. Two options are consumer proposal and bankruptcy. The consumer proposal process is one in which you make an offer to all your unsecured creditors to pay a portion of what you owe in exchange for having the debts discharged. Bankruptcy is a legal process in which an individual’s unsecured debts are eliminated and they are given an opportunity to start fresh.
Depending on your financial situation, one of these options may be the right one for you. Speaking with a Licensed Insolvency Trustee can help you determine if either process is suitable for your situation.
In the past, the operators of the 407 ETR argued that they should be able to enforce collection through the Ontario Registrar of Motor Vehicles and deny the renewal of your vehicle permit if you owed 407 bills but successfully completed a bankruptcy or consumer proposal. However, this was struck down by the Supreme Court of Canada.
This means that 407 debt can be discharged through the bankruptcy or consumer proposal process and you cannot be denied license plate renewal for debts discharged through these processes. Withholding license plate renewal for an honest but unfortunate debtor who worked to resolve their financial issues only served to make life more difficult for them. If you could not renew your plates, you could not drive your vehicle, which would make it very tough to earn a living. Due to this, the courts ruled that you can discharge your 407 debts through the bankruptcy and consumer proposal processes and that the company cannot deny you the right to renew your license plate if you successfully completed these processes.
This makes sense as 407 debts are unsecured debts (they are not backed by an asset, like a home or automobile loan) so including them in the bankruptcy or consumer proposal process is consistent with how these processes work.
How 407 Debt Makes Life Difficult
If you have a large amount of 407 debt, you won’t just be faced with the difficulty of repaying these debts. As mentioned, when you have a lot of debt, it makes it tough to afford the rest of your life. If you are living paycheque-to-paycheque and you are faced with high interest charges or penalties due to missed payments, you’ll spend more money on debt repayment and have less money for everything else. This situation could result in needing to take on additional debt to pay for food, transportation, clothing, and other expenses. Of course, the issue with this situation is that you’ll then be spending even more on debt repayment, leaving even less for living expenses.
This cycle is a very difficult one to get out of and is the reason why the consumer proposal and bankruptcy processes exist. However, as mentioned, these legal processes are not the only options available. Depending on your circumstances, there are other things you can do to potentially improve your situation.
Creating a budget, cutting your expenses, and even possibly looking for ways to earn additional income are all options that could help resolve debt issues. You may also wish to speak to your creditors and explain your situation. Depending on your circumstances, some creditors may be willing to reduce interest charges or penalties to make it easier to repay your debt. However, 407 debt may not fall into this situation, as there tends to be very little negotiation on these bills. If you are in a situation where you cannot repay your debts as they become due, and you have tried to resolve the situation without success, speaking with a licensed professional could be the right choice.