What Happens If I Do Not Pay My Bills?

by Jason Quinney on January 9, 2014


When I meet with people at the Vaughan office, some of them are no longer able to make their payments as they become due or they are on the brink of missing some of their required payments. In these situations, I am often asked what will happen if I miss a bill payment?

Secured Creditors

If you miss a payment to a secured creditor such as a mortgage payment or a car finance payment, you could be at risk of the lender selling that particular asset (property/vehicle) to recoup the money you borrowed to purchase that asset. Although missing any payments are troublesome, missing secured payments can be particularly distressing. Generally you want to make payments to mortgage company before your credit card company.

If you are unable to make payment to a secured creditor contact them immediately. There is no use having the payment being sent back by the bank NSF, it would only make a bad situation worse. When you speak with the creditor, you can explain to them why you cannot make the payment on time. The lender may be more understanding than you would think, especially if you have a good payment history prior to this current missed payment. Try to make acceptable payment arrangements to make up the missed payment, however be careful you are entering into a payment arrangement you can maintain. Ultimately when dealing with secured creditors, you will need to make all the required payments to them or you will risk losing the property they hold the security against.

Unsecured Creditors

Typically when dealing with unsecured creditors, the following will happen:


  • 1st payment missed – They will usually allow you to miss one payment, they will either give you a friendly phone call or letter politely requesting payment
  • 2nd Payment missed – The creditor is likely to be more insistent that a payment be made. Again this is likely to done via a telephone call or letter
  • 3rd Payment missed – It is then most of the trouble begins. In most cases your account will be turned over to a collection agency. You will then be dealing with a collection agent from then on.
  • If you are working and/or own a property, and the debt is a significant amount, the creditor may decide pursue the debt via legal action. This could result in a wage garnishment or a lien being placed against your property.


Debt Management Options

There are many options available for people trying to deal with their debts. At Hoyes Michalos & Associates we do not recommend bankruptcy as your first option. We believe all options should be examined first. Options such as a debt consolidation loan, credit counselling and a consumer proposal should all be considered as alternatives to bankruptcy. A bankruptcy should be contemplated as a last resort.


How to Contact Us

  • Give our office a call at 905-856-2930 or 310-PLAN (7526)
  • Send us an email with our online form.
Share this:
Share this page via Email Share this page via Stumble Upon Share this page via Digg this Share this page via Facebook Share this page via Twitter


Ontario Edging Closer to Regulating Debt Settlement Firms

April 23, 2013

The Ontario government, has taken a few steps forward to protect consumers from some of the current practices used by some debt settlement companies.  The Ministry of Consumer Services issued the following update. I have been keeping the people of Vaughan updated on the progress of the government to regulate this industry in some of […]

Read the full article →

OSB release new 2013 Surplus Income Limits

March 26, 2013

The OSB (Office of the Superintendent of Bankruptcy) recently increased the threshold amounts for which surplus income is calculated during a personal bankruptcy. Below is a chart which summarizes the recent changes. Family Size     Family Unit’s Available Monthly Income 1                                            $2006 2                                            $2497 3                                            $3070 4                                            $3728 5                                            $4228 6                                            $4768 7                                            $5309 A first […]

Read the full article →

What are Minimum Payments on Credit Cards

January 18, 2013

What are Minimum Payments on Credit Cards? Minimum payments on credit cards are usually calculations based on a percentage of what is owed. The percentage is usually around 3% and is usually found in the credit card agreement. Credit cards that have a lower percentage minimum payment typically have a higher rate of interest. Almost […]

Read the full article →

Credit Card Minimum Payment Keeping You In Debt

January 14, 2013

Hoyes, Michalos and Associates, recently employed Harris Decima to conduct a survey on Canadians to gain information about how many people are carrying debt on their credit cards or lines of credit. They also wanted to gather information about how they go about paying their debt. Below I have summarized some of the findings of […]

Read the full article →