One of the worst things I had to do when we filed for bankruptcy was tell my mom and dad. Never mind the shame attached to it, the having to admit we didn't handle everything well, the implied "I told you so's" from all the times they told me that I needed to go get a REAL job.
They were also creditors.
I told her a couple of days before we went in to sign the papers. For days I worked myself up into a frenzy anticipating the backlash. Amazingly, mom seemed to take it very well; this was not, well, normal. My biggest concern was for the payments that still had to be made, so, I approached her about still making payments to them because I didn't want to put them in a tough spot - BUT, since after we declared it would be illegal for us to make those payments, it would have to be done under the table. She refused.
Also, after the obligatory 9 months of reporting is over, we can do what we want with our money, so, we could resume paying them.
When they got the papers they need to fill out if they want to make a claim against our file, it disclosed all our financial info. One of the things that we had to do was cash in my husband's RRSP's (registered retirement savings plan - kind of like the US's 401K) and the amount of the RRSP would have almost covered the entire loan we owed them.
My dad called; they were pissed we didn't cash it in and give it to them before we filed.
Thing is, I had *tried* to explain this to my mom weeks before, but she got all in a huff and we hung up both mad at each other and we had not spoken since.
See, cashing in the RRSP before we filed then giving it to them would not have worked: you can't be seen to have favoured any creditors in the preceding year. They would have had to give that all back once we filed and it was disclosed that we gave a large sum of money to one place. Here, *any* payment over $500 in the past year above and beyond what you have to do is suspect when you declare.
So... a) mom refused the under the table payments, yet still tries to drop the "oh we can't afford things now" guilt trip whenever she can... b) they thought we purposely didn't cash in the RRSPs so that we could get out of paying them... c) somehow they got it into their heads - after I *drilled* it into them to the contrary - that they were never going to see the money again. Apparently we were deadbeats to them which made my mom not speak to me for a month.
Only after she made my dad call to confront me and I got to clear everything up (I only found out most of this a couple of days ago) did she call me later that day like nothing happened. So.. even through I explained everything, and laid out *all* that was happening and would happen, they still didn't hear it...
Well - my mom at least. I never did get to speak to my dad about it until then. And, well - he got his "go get a real job" and "call your cousin about working for him" in again.
(N.B. The RRSP went towards the payments we had to make to the trustee. When you file here, for the 9 months you have to make monthly payments. Luckily, in a way, the RRSP cut what we had to pay in half, so our resulting monthly payments are lower.)
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