Bankruptcy BC - Filing Bankruptcy in British Columbia, BC
How to Declare Bankruptcy – Speak to a Licensed Insolvency Trustee in BC Today!
Our website has full information on bankruptcy in BC so people who are considering filing bankruptcy can make an informed decision about bankruptcy before visiting with a trustee.
Residents of Fort Nelson can file a bankruptcy or proposal online.
Residents of Houston can file a bankruptcy or proposal on line.
Residents of the Queen Charlotte Islands can file a bankruptcy or proposal on line.
When you meet with one of our Licensed Insolvency trustees you will have a good idea of how the bankruptcy laws can help you if you read the information on our site.
For first time debtors’ bankruptcy can wipe out all of our eligible debts within 9 months, or within 21 months if the debtor has excess income (over $100 a month.)
Most debtors who file bankruptcy have no assets that they will lose when filing bankruptcy, and a BC bankruptcy allows a person to receive a fast fresh start to their financial life.
Under bankruptcy law, debtors filing bankruptcy are allowed to keep certain assets, known as bankruptcy exemptions.
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The Law is designed to allow a person who has debts they cannot repay a chance for a new financial life by eliminating their debts.
If you have property that is not covered by the BC bankruptcy exemptions, or you wish to repay your debts over a longer period of time you can file a Consumer Proposal.
A consumer proposal will last for a period of three to five years.
The Bankruptcy laws cover proposals and do not allow a proposal to last longer than 5 years.
When you want to talk with one of our Licensed Insolvency Trustees in bankruptcy about filing bankruptcy, you can call one of our listed trustees in bankruptcy in BC to set up a free consultation meeting.
After you are discharged from bankruptcy you can rebuild your credit score and get a credit card.
What is Personal Bankruptcy?
In BC, most debtors that file personal bankruptcy have all of their assets protected by the BC bankruptcy exemptions.
This means that most bankrupts in BC can keep all of their assets when going bankrupt.
BC bankruptcy is a federal law governed by the Bankruptcy & Insolvency Act, and certain BC bankruptcy rules.
The BC bankruptcy laws were written to give an unfortunate but honest debtor to receive a discharge of their debts.
Your Trustee will also ensure that your creditors are treated in an equal and fair manner.
The BC bankruptcy process gives you a fresh start financially.
Can I File For Bankruptcy in BC?
You are eligible to file for bankruptcy in BC (and the rest of Canada) if you have lived or done business in Canada in the past year, and if you are insolvent.
Insolvent means that you owe $1,000 and are unable to pay your debts as they are due and have more debts than the value of your assets.
What Happens When I File Personal Bankruptcy in British Columbia?
Immediately upon filing bankruptcy all collection actions, either in place or being planned, will be stopped.
All wage garnishments, collection calls, and lawsuits against you will stop.
This happens through the Personal Bankruptcy law known as the “Stay of Proceedings.”
It is important to note that bankruptcy only deals with unsecured debts, so you can still receive a collection call or be sued by a secured creditor.
Often people struggling with debt find that the relief from unsecured debts makes paying their secured debt obligations much easier.
Once you have filed bankruptcy you will stop paying your unsecured debts, and you will make a payment each month to your Trustee.
The minimum payment for bankruptcy in British Columbia is $200 a month, although if you have surplus income your bankruptcy payment will be higher each month.
You are required to submit to your Trustee proof of your net income each month, so the Trustee can calculate if you have surplus income requirements.
What is Surplus Income?
Surplus income is required if your household income is over an income threshold set by the government based on the size of the family unit.
If you have surplus income, you must pay a portion of this surplus – 50% – to your Trustee, who will distribute your surplus income to your unsecured creditors.
What are the Steps to Filing Personal Bankruptcy in BC?
Step 1: Schedule a Free BC Bankruptcy Consultation With a Licensed Insolvency Trustee
You can call a local trustee in your area to have your financial situation assessed by a government licensed trustee.
The trustee will meet with you to discuss your financial situation and then the trustee will explain all of your possible options, including personal bankruptcy.
Your trustee might also suggest a consumer proposal or will be able to help you avoid bankruptcy and a proposal altogether.
If you and the trustee decide that BC bankruptcy is the right choice for your money problems, the trustee will cover everything that personal bankruptcy involves.
The trustee will cover the required payment you will have to make each month, how long your bankruptcy will be, the duties you will be required to complete, and the impact of bankruptcy on your spouse, family and credit rating.
The trustee will answer all of your questions about BC bankruptcy, and will ensure that you are comfortable with starting the process.
Step 2: Fill out and Sign the Necessary Bankruptcy Forms
The trustee you meet with will provide you an application form to fill out.
Once you have completed this form you will return it to the Trustee.
Most Trustees will have an application form you can fill out online and email to the Trustee.
Once the Trustee has your signed application form, they will prepare all the necessary legal bankruptcy forms that are required to file personal bankruptcy in BC.
These forms can be processed very quickly if you need immediate relief from your creditors.
The Trustee will cover all the documents with you to ensure that you have a full understanding of the legal process and your duties in a personal BC bankruptcy.
We will ensure you are aware of your duties and what is expected of you as a bankrupt.
Once you are comfortable you will sign all the forms and the Trustee will submit them to the OSB (Office of the Superintendent of Bankruptcy.)
Step 3: Report Your Income and Expenses, Pay the Required Fees and Complete Any Other Duties
One of your main duties as a bankrupt is to submit to your Trustee a monthly statement of your income and expenses each month.
Your Trustee will use this to determine if you have any surplus income requirements.
You will also be required to submit your payment to the Trustee each month ($200 monthly in a simple first time bankruptcy) and complete any other duties that the Trustee requests of you.
Step 4: Attend the 2 Required Financial Counselling Sessions
As a bankrupt another of your required duties in order to receive your discharge is to complete two financial counselling sessions with your Trustee.
You can complete these counselling sessions with another group of bankrupts, or you can have it 1 on 1 with your Trustee.
The meetings will usually last one hour, and are intended to teach you good financial management skills.
The first meeting must be held within 30 days of your bankruptcy filing, and the second meeting usually occurs at the 7th month of your bankruptcy.
Step 5: Receive Your Bankruptcy BC Discharge
Once you have completed your personal bankruptcy, along with all of the necessary duties, you will receive your discharge from bankruptcy.
Your debts will be discharged and you will have a fresh financial start.
Your discharge might be objected by your creditors, the Trustee or the Office of the Superintendent of Bankruptcy, although this is very rare, and is almost always because you didn’t complete your duties, which your Trustee will help you complete so your discharge is not objected.
Once you have received your discharge you will be issued a certificate of discharge from your Trustee.
You now have your fresh financial start and can begin rebuilding your credit.
What Can I Keep?
When you file bankruptcy in BC you are permitted to retain your assets that are listed in the bankruptcy exemptions.
The BC bankruptcy rules lay out which assets are exempt for BC bankruptcy.
The personal bankruptcy exemptions in BC include:
- Your car with equity of $5,000 or less (If your car is worth $25,000 but you have a $20,000 loan on it, you have equity of $5,000 and can keep the vehicle.)The vehicle exemption in BC drops to $2,000 if the bankrupt is behind on child care payments;
- Your home if the equity is $9,000 (or $12,000 of equity in the Greater Vancouver Regional District or the Capital Regional District);
- $10,000 in “Tools of the Trade”;
- Household goods to a value of $4,000 (Resale value);
- Necessary clothing for the debtor and the family;
- Required medical aids for the debtor and family;
- RRSPs (Any amounts invested in the prior 12 months must be surrendered to the Trustee for benefit of your creditors.)
What is The Cost of Bankruptcy in BC?
The cost of filing bankruptcy in British Columbia is a minimum of $1,800, which includes the Trustee fees.
Most Trustees will accept $200 a month for 9 months, which is the minimum length of bankruptcy.
The cost of filing bankruptcy in BC can increase substantially however if you are required to pay surplus income payments.
In certain cases, you might find a consumer proposal more cost effective than filing for bankruptcy.
When Are My Debts Extinguished?
Your unsecured debts (with certain minor exceptions) will be legally eliminated when you receive your bankruptcy discharge.
For most bankruptcies the discharge occurs automatically after 9 months.
This is for a first time bankruptcy in BC, where the debtor has no surplus income requirements.
The bankruptcy discharge will be delayed if the debtor has a prior bankruptcy or must make surplus income payments.
Your discharge from bankruptcy can also be delayed if you don’t complete your bankruptcy duties.
- A first time bankrupt with no surplus income, who completes all his duties, will receive their discharge automatically in 9 months;
- A first time bankrupt with surplus income, who completes all his duties, will receive their discharge from bankruptcy automatically in 21 months;
- A second time bankrupt with no surplus income, who completes all his duties, will receive their discharge automatically in 24 months;
- A second time bankrupt with surplus income, who completes all his duties, will receive their discharge from bankruptcy automatically in 36 months;
- A third time bankrupt will have to go to court to receive their bankruptcy discharge.
What Debts Survive Filing Bankruptcy in BC?
All of a bankrupt’s debts will be legally discharged once they receive their absolute discharge from bankruptcy with the following exceptions:
- Secured debts (bankruptcy only deals with unsecured debts);
- Child support payments;
- Debts obtained through fraud;
- Debts not included in the bankruptcy (ie, debts you incur during your bankruptcy);
- Court ordered fines or penalties;
- Student loans, if you have not been out of school for at least 7 years.Section 178 of the Bankruptcy and Insolvency Act lists the debts that are not dischargeable in a personal BC bankruptcy.
How Does Filing Bankruptcy Affect my Credit Rating?
When you go bankrupt you will receive an R9 credit rating on your credit report, which is the lowest score.
However, if you are insolvent and considering bankruptcy, your credit score is probably already as low as it can get.
Even though your bankruptcy will appear on your credit report for at least 6 years (or 14 years for a second bankruptcy), filing bankruptcy gives you a fresh start, which is often exactly what bankrupts need to begin rebuilding your credit.
A record of your bankruptcy being on your credit report will not mean you are refused credit.
After you have received your bankruptcy discharge, you can immediately begin rebuilding your credit score.
In fact, a bankrupt can receive a mortgage – which is often the most difficult credit to be approved for – within as little as 2 years after their bankruptcy discharge if they work diligently at rebuilding their credit.
Before going bankrupt many BC debtors have a very poor credit score, and actually filing bankruptcy is their first step to rebuilding a good credit score.
Who Will Know I Filed Personal Bankruptcy?
While your bankruptcy filing is a matter of public record, your friends and family will likely never know you went bankrupt unless you decide to tell them.
Your employer will also never know of your bankruptcy, unless your wages were garnished (in which case your employer will be notified to stop the wage garnishment.)
Your bankruptcy will appear on your credit report and your creditors will be notified, but your Trustee does not notify anyone else, and no notice is made in the newspaper for personal bankruptcies in British Columbia.
Bankruptcy British Columbia
Personal bankruptcy in British Columbia is for individuals who are facing financial difficulties and finding it hard to manage.
There are some bankruptcy alternatives that could be available to you, although bankruptcy helps hundreds of British Columbia residents get out of debt every month.
To learn more about BC bankruptcy, British Columbia consumer proposals, and other bankruptcy alternatives please contact one of our Government Licensed British Columbia Bankruptcy Experts today.
You can schedule a free consultation and get answers to all of your questions.
Why you Should use a British Columbia Bankruptcy Trustee
if you have Serious Debt Problems.
Bankruptcy Trustee Expertise: A Licensed Insolvency Trustee must undergo rigorous training and receive training in a bankruptcy and law course before they can be granted a trustee license.
Most trustees have an accounting certification in addition to their university degree.
Bankruptcy trustees in BC must be investigated by the RCMP and engage in ongoing professional development.
Protection From Your Creditors: Under the BC bankruptcy laws a bankruptcy trustee is the only debt relief professional who can provide you with protection from creditor harassment.
Rebuild Credit: When you file bankruptcy or submit a consumer proposal you can rebuild your credit score faster than by working with a credit counsellor.
Cost: BC Licensed Insolvency Trustees have their fees controlled by the government so filing bankruptcy with a BC Licensed Insolvency Trustees will be cheaper than by using another debt consultant.
BC Licensed Insolvency Trustees Have a High Level of Integrity: Trustees must follow a strict code of ethics, and in many cases will advise people that they can get out of debt without filing bankruptcy.
BC Licensed Insolvency Trustees must give you their best advice, whether that means you will file bankruptcy with them or not.
Ease of Mind: BC Licensed Insolvency Trustees must follow their strict code of ethics and are also regulated by the government, ensuring that you will be dealing with a professional when you file bankruptcy with the services of a BC Licensed Insolvency Trustees.
Under Canadian law the only debt relief professionals are bankruptcy trustees.
We wrote this site to provide personal bankruptcy and consumer proposal information to residents of British Columbia and Canada.
We are proud to provide answers about consumer proposals – the number one bankruptcy alternative – and bankruptcy in British Columbia.
This site is for information only.
Our Government Licensed BC Bankruptcy Trustees offer risk free evaluation meetings to discuss your options, including personal bankruptcy or a consumer proposal.
Don’t hesitate to contact one of our British Columbia bankruptcy experts today to learn how bankruptcy in BC can help you get out of debt and get a fresh financial start.