5 Things to Know About Filing Bankruptcy in Ontario
What You Should Know About Ontario Bankruptcy
Are you thinking about filing for bankruptcy in Ontario?
If so, it helps to know as much as possible about this process.
Below, we’ve listed the top five things to know about filing for bankruptcy.
By seeing them, you should be able to make a more informed decision when picking whether or not to go down this route.
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#1 A Licensed Insolvency Trustee is the only person who can file bankruptcy in Ontario
It’s impossible to file your bankruptcy all by yourself.
In fact, the law in Canada prevents this as you need the help of a licensed professional.
Licensed Insolvency Trustees are the only people in the country who can legally file a bankruptcy.
So, be sure to get in touch with one before beginning any bankruptcy proceedings.
#2 You get to keep your basic possessions
It’s a common misconception that you lose all of your belongings when going bankrupt.
On the contrary, Ontario bankruptcy law states you can keep a handful of basic possessions.
This includes a car under a certain value, your house, furniture, and many other things.
However, you do have to hand over many other assets.
These will be detailed in a Statement of Affairs where you list everything you own.
You will also have to assign your property to the trustee, so they can hold onto it during the bankruptcy process.
#3 You can be discharged after 9 months
If you complete all of your obligations in that time, you will be discharged and free to enjoy a fresh start.
There are some caveats that can alter the duration of your bankruptcy.
If you miss some payments or fail to fulfill your obligations, it can be extended.
Some of these obligations include credit counselling meetings and meetings between your creditors.
You also need to keep reporting your monthly income in case the situation changes.
There could also be some payments you have to make along the way as well.
#4 There are surplus income limits
You have a limit to how much money you can earn each month during bankruptcy.
If you earn above this, it is called surplus income.
You’re only allowed a certain amount of surplus income each month, or else you have to make surplus income payments.
This is another thing that can extend your bankruptcy duration and postpone the discharge.
#5 It should always be a last resort
Don’t jump to the conclusion that bankruptcy is automatically the right option.
It should only be considered if no alternatives exist for you.
This is typically the case when you have growing debts and can’t find any way of paying them.
You tried everything, even a consumer proposal, but nothing helped.
Here, bankruptcy is your only choice.
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