I Am Leaving Canada – What Happens To My Debts?

Exiting Canada: The Fate of Your Financial Obligations

When the decision to leave Canada is made, a bevy of questions surrounding financial responsibilities come into play. What happens to my debts? This article unpacks the complexities and implications of debt management for those planning to leave Canada.

The Unavoidable Reality of Debts

Whether you are residing in Canada or have relocated to another part of the globe, your financial obligations still stand. Creditors, devoid of sentiments, are primarily interested in the repayment of your debts. Leaving Canada, either for a short period or permanently, places creditors in a decision-making position about your debt management.


Note: The location of the debtor doesn’t influence the existence of the debt. The obligation to repay remains.


Creditor’s Knowledge and Debt Size

Two essential factors for creditors are their awareness of your whereabouts and the size of your debt. The larger the debt, the more resources a creditor is willing to invest to recoup what’s due. If they know your location, it could influence their actions.

Legal Proceedings and Enforcement

Creditors have the legal right to sue you in Canada. If they secure a judgement, they may attempt to enforce it in your current country of residence. However, this process presents challenges for the creditor. They must prove to the court that you received proper notice of the lawsuit to obtain a judgement against you. Furthermore, the enforcement of a Canadian judgement is not universally recognized. It’s a complicated, costly process, often requiring the services of a local lawyer.

Keep in mind: Not all countries will enforce a Canadian judgement. It’s a time-consuming, expensive process that requires local legal representation.

The Choice of Creditors

Unless the debt is substantial, most creditors will refrain from pursuing you internationally. Instead, they may attempt to pressure family members still in Canada, suggesting severe consequences if the debt isn’t repaid. However, this is a myth. Creditors, like everyone else, must abide by the law. In many cases, they prefer to wait, hoping that you’ll return to Canada and they can legally pursue debt collection.

The Rights of the Debtor

As a debtor, you have rights too. For instance, within a year of leaving Canada, you can file a proposal or declare bankruptcy. While this is a more complex procedure requiring remote assessments and counseling authorization from the Office of the Superintendent of Bankruptcy, it’s a viable option for many. The motivation behind this action is typically the desire to return to Canada debt-free, enabling a fresh start.


For more information on bankruptcy and debt solutions, contact Bankruptcy Canada.

In conclusion, exiting Canada doesn’t absolve you of your debts. You need to understand the implications and manage your financial obligations responsibly. Stay informed, understand your rights, and seek professional help when needed.

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