Bankruptcy Canada Financial Facts Quiz

This is a common misconception. Checking your own credit score does not affect your credit score.

Your income has nothing to do with your credit score or credit report. Your credit score is solely a measure of your ability to pay your bills on time.

Personal Income tax debt, as is true for most debt, can be erased in a bankruptcy.

Debts erased by the bankrupt’s discharge are all debts except for the following:

1. Fines imposed by a Court;
2. Money owing for things stolen;
3. Things obtained by misrepresentation;
4. Alimony or maintenance payments;
5. Award of damages by a court for intentionally inflicting bodily harm or sexual assault;
6. Student loans if bankruptcy is filed prior to or within seven years after the finish of studies;
7. Debts that were incurred during the time you were bankrupt.

Your credit score is solely a measure of your ability to pay your bills on time.
In order to have good credit you have to use credit, and use it responsibly.

Credit Bureaus will remove incorrect information but they will not remove information that is correct.

Getting out of debt will certainly improve your financial situation, although it won’t necessarily have an impact on your credit score. Your credit score is based on certain factors such as your payment history and your utilization of credit.

After you get out of debt, we recommend that you maintain an active credit account. You can use a credit card to make small monthly expenses, for example, to show the credit reporting agencies that you are handling credit in a responsible manner.

Without maintaining active credit, the Equifax and TransUnion won’t have a record of how you are managing your credit, which can actually hurt your credit score over time.

This is a bit of a trick question. Paying more than the minimum will not necessarily, in the short term, give you a better credit rating. However, it is to your advantage to pay down your credit card debt, which will give you a better credit rating, long term.

In some cases unscrupulous debt consultants try to mislead people into thinking that they can file bankruptcy and consumer proposals for them. In fact, only Licensed Insolvency Trustees can do this.

Licensed Insolvency Trustees are the only debt consultants, who can stop wage garnishees, either in place or contemplated.

People filing bankruptcy will not lose all their assets. One of the major tenets of Canadian bankruptcy law is that a person, overwhelmed by debt, deserves the opportunity of a fresh financial start. Part of that fresh start includes leaving the person with enough possessions to maintain dignity and to help that person towards his or her fresh start.

Your province or territory sets the exemptions, or asset you are allowed to keep in a bankruptcy or a consumer proposal.