Debtors approaching our MNP bankruptcy trustees in Airdrie are plagued by misinformation regarding bankruptcy.
From debtors trying to take advantage of bankruptcy to stop making payments to debtors utterly ashamed to face the society fearing stigma, our trustees encounter extreme reactions formed as a result of the misinformation.
MNP Limited Airdrie, AB Licensed Insolvency Trustee
As a firm of licensed insolvency trustees (LITs) that has worked with thousands of debtors and creditors, our MNP Airdrie bankruptcy experts shatter some prevailing bankruptcy myths here:
Myth: Bankruptcy is an Easy Solution that Any Debtor can Avail
Bankruptcy is not for everyone. You have to fulfil the following conditions to be eligible for bankruptcy:
- You must be a Canadian resident;
- Have over $1000 in debt; and
- You are unable to make payments to creditors in the timeframe agreed upon
While you may qualify for a bankruptcy by fulfilling the above conditions, LITs will still consider it only when all other debt-relief options have failed.
Secondly, bankruptcy is not easy.
The whole process takes time and can be physically and mentally stressful. Once you have filed for bankruptcy, the information stays on your credit report for 6 to 7 years.
Lenders will consider you a high-risk borrower, and you may be unable to get credit. You will have to go through the feelings of regret and helplessness while trying to start your life afresh.
Myth: You will be Left with Nothing after a Bankruptcy
The Federal bankruptcy law governed by the Bankruptcy and Insolvency Act of Canada and the provincial Alberta law ensure that you do not lose everything during a bankruptcy.
You can retain food items enough for 1 year; clothing items not exceeding $4, 000; household appliances and furniture up to a value of $4, 000; dental and other medical aids with no value limit; pensions and specific benefits; specific insurance policies; trade tools valuing up to $10, 000; among others.
There is also an exemption on your main residence for an equity amount not above $40, 000. Your LIT can guide you through these exemptions.
Myth: Everyone Will Know about my Bankruptcy
Unless you are a celebrity or you intend to tell everyone, no one except your creditors, LIT, credit bureaus and the OSB (Canada government’s bankruptcy department) will know about your bankruptcy.
Unless you have major assets, legal notices about your bankruptcy will not be published in papers. Your LIT will notify your creditors only through mail.
The OSB maintains public records of bankrupt people. People can search for a record at a cost of $8 per search. The search needs registration and has to be highly specific.
Chances are no one will bother to go through the effort to know if you are bankrupt or not.
If you are in an unmanageable debt situation, the OSB recommends that you consult a LIT first. You can choose a LIT that you are comfortable with at our MNP Airdrie bankruptcy firm.
Our experienced trustees can guide you with accurate legal information and help you take the best decision.
Our MNP bankruptcy firm in Airdrie is located in the heart of the city. Visit us today for an initial free consultation.
Airdrie AB T4B 2N1