'It's heartbreaking': Struggling families opt for bankruptcy in western Labrador

If Labrador West was a Charles Dickens novel, it would be the worst of times. At least for a chunk of the population.

Danny Vey moved home to Labrador City in 2007 during the mining boom.

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Vey has a biochemistry degree from Memorial University, but instead of becoming a scientist he went north for the money, working at IOC as a team leader and supervisor.

"It paid double or triple for almost any job in mining compared to being a scientist."

It's heartbreaking. I go home many nights with a heavy heart.- Norm Keats

With the closure of Wabush Mines in 2014 and the shut down of other iron ore projects in the area, many people in the region are struggling to pay the bills, including Vey.

The area's housing market is also taking a pounding.

On Tamarack Drive in Labrador City, notices are posted to door windows on some of the homes warning people to not trespass, adding the property is being cared for by Veranova Properties on behalf of the mortgagee.

That's a situation Vey is hoping to avoid.

'I'm mortgage broke'

He bought a home in February 2013, one year before the Wabush Mines shutdown, because rents were high and finding a place to live was difficult.

The duplex on Viking Crescent cost Vey $385,000. Now, Vey thinks he might get $180,000 if he sold it.

"You paid what you had to pay because at the time, with the expansion IOC had going on, you couldn't rent a place. Everything was booked," he said.

"I had friends who were buying houses out of greed if they could afford it and more power to them. Renting out to contractors for $6,000 a month."

I don't know what I'd do if I had to come up with an emergency expense.- Danny Vey

The iron ore industry in western Labrador isn't immune to global low prices for the commodity.

Vey was let go from IOC in December of 2014, but he caught a break and was hired early in 2015 with Tata Steel in Schefferville, Que.

The catch? He's making around $70,000 to $80,000 a year, about half of what he'd been making at IOC.

Vey says his only debts are his mortgage, child support payments and heat and light, but still he feels trapped.

"I'm mortgage broke. I ended up getting a decent sized [house], it wasn't anything extravagant, severance package from IOC, so that supplements my income," said Vey.

"I own my vehicles — thank God, because I don't know what I'd do if I had to come up with an emergency expense. Right now it's paycheque to paycheque or even worse.

"I'm supplementing a bit of the money I had from my severance package just to make ends meet, but eventually that is going to run out which is going to be this year. After that I don't know what my options are. It could be bankrupcy."

'It's heartbreaking'

Norm Keats, with New Lab Realty, has been in business in Labrador City for 44 years and said he's never seen the industry so bad.

As of last month, he said the area had 38 foreclosures and over 300 properties on the market.

I don't know what my options are. It could be bankrupcy.- Danny Vey

A house that had been selling at $635,000 during the good times, might fetch $300,000 to $350,000 now.

"It's heartbreaking. I go home many nights with a heavy heart, you know, going into the homes and listening to the people and then see the husband and the wife and children crying because they have no place to go and nowhere to turn," said Keats.

"A lot of them are just throwing up their hands and saying, 'Look we cannot take any more of this and we have to pass the keys back to the bank and declare personal bankruptcy.'"

Struggling to make ends meet

Meanwhile, Vey said he isn't sure what to do.

He'd like to renovate and add an apartment to his home, but he can't really afford that.

"I'm an educated guy, I got a decent job as far as Canadian standards," said Vey.

"I'm average or above, but right now it's not even enough to make ends meet in this town."