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Bankruptcy availability to all Canadian adults has been put in place by the Government of Canada to allow men and women who have unbearable levels of debt on their shoulders, to receive relief by having all of their debts, in layman's terms, cancelled.
- Explain Bankruptcy?
- Are you Eligible to go Bankrupt?
- What cannot be Taken from Me?
- What happens to Creditors who Harass Me?
- What is the Length of My Bankruptcy?
- What does Bankruptcy do to My Credit Rating?
- Are there Debts that cannot be Discharged from Bankruptcy?
- What are the Rules on Student Loans?
- What is a Consumer Proposal?
- What is the Advantage in Choosing a Consumer Proposal?
- Who is Eligible to File a Consumer Proposal?
- In which Manner are the Payments made to the Creditors under the Consumer Proposal?
- What does a Consumer Proposal do to My Credit Rating?
Explain Bankruptcy?
Bankruptcy is a legal process administered pursuant to the Bankruptcy and Insolvency Act. This procedure, on the most part, will discharge you from all your debts and stops all legal proceedings instituted by your creditors. The Bankruptcy and Insolvency Act gives you a chance to rehabilitate.
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Are you Eligible to go Bankrupt?
If you are not able to make your payments as they become due and owe $1,000 or more, you are eligible to file for bankruptcy.
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What cannot be Taken from Me?
You are allowed to keep your personal belongings and furniture, provided that they have a market value of less than $6,000. Certain items can be exempt, such as: work tools, etc.
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What happens to Creditors who Harass Me?
One of the objectives of the Law is that you are liberated from the harassments brought upon by your creditors. If you receive phone calls or letters by your creditors and you have declared bankruptcy or have filed a consumer proposal, ask them to contact your Trustee or administrator.
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What is the Length of My Bankruptcy?
In the case of a first time bankruptcy, you will have an automatic discharge after nine months from the date of filing, unless the Trustee recommends a conditional discharge or a creditor, the Trustee, the Superintendent of Bankruptcy oppose your discharge. If it is a second time bankruptcy, there will be a hearing before the Court.
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What does Bankruptcy do to My Credit Rating?
The information of your having been discharged from the bankruptcy will be recorded at the credit bureau for a period of six (6) years from the date of your discharge.
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Are there Debts that cannot be Discharged from Bankruptcy?
In Article 178 of the Bankruptcy and Insolvency Act, the principal extracts of the non dischargeable debts are:
- Arrears of alimony
- Fines (tickets)
- Debts obtained under false declarations
- Fraud
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What are the Rules on Student Loans?
An order of discharge does not release the bankrupt from a student loan within ten (10) years after the date on which the bankrupt ceased to be a full or part time student.
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What is a Consumer Proposal?
A proposal is an offer made to the creditors of a certain percentage of the debts. The creditors must vote on the offer, according to the process of the Bankruptcy and Insolvency Act and to be accepted, we must have the majority of votes in favor of the proposal. Upon acceptance, all the creditors are bound by the proposal.
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What is the Advantage in Choosing a Consumer Proposal?
Your assets are not given to the Trustee for the benefit of the mass of creditors.
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Who is Eligible to File a Consumer Proposal?
If your debts are less than $75,000, excluding the mortgage on your home, a person or a bankrupt can file a consumer proposal.
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In which Manner are the Payments made to the Creditors under the Consumer Proposal?
The Trustee will distribute the funds to the creditors according to the submitted offer.
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What does a Consumer Proposal do to My Credit Rating?
Upon receipt of the Certificate of Full Performance of your consumer proposal, the information will be recorded at the credit bureau for a period of three years.
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