You might want to consider bankruptcy in Canada if:
* You are unable to make the minimum payments on your credit cards or other unsecured debts;
* It is a challenge for you to repay your monthly bills;
* Are being constantly harassed by creditors and collection agencies (a bankruptcy stops all collection actions by your creditors through the automatic stay);
* You are using your credit cards for everyday expenses;
* Your wages are being garnished or you know a wage garnishment order is being considered as bankruptcy will stop a wage garnishment through the automatic stay.
* You will have all of your unsecured debts (with some exceptions in rare cases) eliminated by filing for bankruptcy;
* Creditors will not be able to take any legal action against you;
* Bankruptcy in Canada can stop wage garnishments;
* Your assets are protected from seizure in many cases;
* You will be required to complete bankruptcy counselling that will help you stay debt free and enjoy a secure financial future;
* The stress and anxiety that comes from being trapped in debt will end;
* You can begin rebuilding your credit and get on the path to a fresh start.
Need Help Reviewing Your Financial Situation?
Contact a Licensed Trustee for a Free Debt Relief Evaluation
There are certain bankruptcy basics you should have a basic understanding of before you speak with a bankruptcy trustee about your debt relief options.
Bankruptcy in Canada Offers Immediate Protection
When you declare bankruptcy in Canada you will receive an “Automatic Stay” which is a legal order that prevents your creditors from making any collection action or suing you in an attempt to collect on what you owe them.
All creditor calls will stop and you won’t have to deal with your creditors at all.
You will stop making payments to your creditors and your trustee will handle all contact with your creditors on your behalf;
You are not alone in Considering Bankruptcy
As a legal process that is intended to give honest but unfortunate debtors a chance for a fresh start.
In 2018 more than 125,000 people filed either a bankruptcy or a consumer proposal.
Bankruptcy is a Fair Process
When you go bankrupt you will be allowed to keep certain assets and you will be given a fresh start.
Additionally, your creditors will recoup part of the fees paid into the bankruptcy estate, including proceeds from a sale of any non-exempt assets.
The more you earn the more you will have to pay to your creditors, and the longer your bankruptcy will last to ensure the process is fair for you as well as your creditors.
You can Live Debt Free Relatively Quickly
– Compared to other debt relief options bankruptcy is often the fastest and most affordable way to a fresh financial start.
In fact, if you haven’t been bankrupt before and have no surplus income you will be debt free 9 months from the date of your bankruptcy filing.
You Will Not Lose Everything When Filing Bankruptcy
By filing for bankruptcy you will not lose everything and you will be able to keep certain assets, including your car, RRSPs and your house.
The Bankruptcy and Insolvency Act allows for certain bankruptcy exemptions in each province which protects your assets from seizure. Even if your assets are not protected by the bankruptcy exemptions in your province you can still keep the asset in certain cases.
More Information on Personal Bankruptcy in Canada:
Costs of filing bankruptcy: When you meet with your Bankruptcy Canada Trustee they will explain the costs of filing for bankruptcy and will help you understand how the costs to file bankruptcy are determined
Bankruptcy and Your Assets: A popular question many debtors have about filing for bankruptcy is whether you are able to keep your house when declaring bankruptcy and if bankruptcy will affect your mortgage.
As your home is a secured asset your home debt (your mortgage) cannot be included in your bankruptcy.
If your equity is less than the home exemption in your province you will be able to keep your home when going bankrupt.
If you have more equity than you are allowed to keep you will be able to still keep your home if you pay the trustee the difference in the equity you have and the equity you are able to keep as listed under your province’s bankruptcy exemptions.
What Debts are Not Included in Bankruptcy?: While bankruptcy can eliminate all unsecured debts in almost all bankruptcies there are certain exceptions to the debts that can be eliminated in bankruptcy. Not all of your debts will be eliminated when you receive your bankruptcy discharge including debts arising from fraud, alimony payments, child support payments, court awarded damages, student loan debt if the student loan debt is less than 7 years old
Tax Debts and Bankruptcy: If you have debts owing to the CRA (Canada Revenue Agency) you are not alone. Many debtors considering bankruptcy have unpaid taxes owed to the CRA that is a large amount of the debt that they owe.
When you get your bankruptcy discharge your debts owing to the CRA will be released and you will not be responsible for paying your unpaid tax debt.