How Do I Declare Bankruptcy in Manitoba?

A Guide To Going Bankrupt in Manitoba

Filing for bankruptcy could be a daunting task, especially when you’re already dealing with financial stress. But, it can also be a significant step towards financial freedom. In this comprehensive guide, we’ll walk you through the process of declaring bankruptcy in Manitoba, Canada.

Understanding Bankruptcy

Bankruptcy is a legal process that provides immediate protection to individuals struggling with debt. It grants you a fresh start by eliminating most of your unsecured debts. However, keep in mind that certain debts like child support, alimony, student loans less than seven years old, fines, penalties, and debts resulting from fraud cannot be discharged.

Advantages of Declaring Bankruptcy

 

Automatic Stay of Proceedings: Filing for bankruptcy triggers an automatic stay of proceedings, which means all collection efforts, wage garnishments, and legal actions against you will be stopped instantly.

Elimination of Unsecured Debts: With certain exceptions, bankruptcy will help you get rid of your unsecured debts.

Fresh Start: Once your unsecured debts are discharged, you’ll have the chance to create a new financial roadmap.

 

The Process of Declaring Bankruptcy in Manitoba

In this section, we’ll delve into the steps involved in filing for bankruptcy in Manitoba.

Step 1: Find a Licensed Insolvency Trustee (LIT)

When you decide to declare bankruptcy, the first thing you need to do is find a Licensed Insolvency Trustee (LIT). These are professionals authorized and regulated by the Federal government of Canada to administer bankruptcies.

Step 2: Consult with Your LIT

Your LIT is not only there to help you with bankruptcy. They can provide a full range of debt relief options. During your initial consultation, your LIT will review your current financial situation and discuss all the available debt relief options with you.

Step 3: File for Bankruptcy

If you decide to proceed with bankruptcy, your LIT will prepare the necessary paperwork and review it with you to ensure its accuracy. Once you sign off on the paperwork, your bankruptcy begins, and your creditors will be notified.

It’s important to note that declaring bankruptcy isn’t a one-and-done deal. You’ll need to fulfill certain obligations as outlined in the Bankruptcy and Insolvency Act of Canada. These may include providing monthly income statements to your Trustee, attending mandatory credit counseling sessions, updating your Trustee with your contact information and tax details, and making monthly payments to your Trustee.

What Happens After Filing for Bankruptcy?

After you file for bankruptcy, you’ll be required to complete your bankruptcy obligations. A first-time bankruptcy is usually discharged in nine months if duties have been completed and there is no excess income. If there is excess income, the discharge date moves to 21 months from the date of bankruptcy.

Drawbacks to Filing for Bankruptcy

Declaring bankruptcy does come with a few drawbacks. One significant disadvantage is the impact it has on your credit score. However, if you’re already missing loan payments or bills, your credit score likely has already been affected. While a bankruptcy will remain on your credit report for six years after discharge, it’s a full solution to accumulated unsecured debt that enables you to start over.

In Conclusion

If you’re considering bankruptcy as a solution to your financial woes, reach out to a Licensed Insolvency Trustee today. The sooner you get professional help, the more debt relief options you’ll have. Remember, bankruptcy may not be inevitable. Start your journey towards a fresh financial beginning today.

For more information on how to declare bankruptcy in Manitoba, contact a Licensed Insolvency Trustee or set up an appointment for an in-depth review of your situation and help in finding the right solution that gets you back on your feet financially.

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