What is Bankruptcy Canada?
Bankruptcy Canada is a legal proceeding that is available to a person to cope with a financial crisis. One of the main purposes of bankruptcy is to afford the opportunity to a person, who is hopelessly burdened with debt,
to free themselves from debt . Contact us and get " Fresh Start ".
Who Is Eligible to File Bankruptcy Toronto?
You must owe at least $1,000.00, be 18 years of age and be unable to meet regular payments to creditors as they become due.
Can I Choose Which Debts Are Included?
No. All debts must be included in the bankruptcy. However, some debts will survive the bankruptcy and they will still have to be paid. Such as:
- court fines
- things obtained by misrepresentation or fraud
- alimony or maintenance payments
- award of damages by a court for intentionally inflicting bodily harm or
sexual assault - student loans if bankruptcy is filed prior to or within 10 years after
the termination of studies
Will My Creditors Stop harassing Me?
Yes, they will! By law, all actions against a person must cease once the bankruptcy documents are filed. This does not apply to secured creditors such as banks holding, for example, a lien on a car.
What Happens to My Assets?
In Ontario, what you are entitled to keep is determined by the Executions Act. In summary, you are generally able to keep the following property:
- Necessary clothing and personal effects up to a value of $5,000.00.
- Household furnishings and appliances to a value of $5,000.00.
- Personal property (i.e., tools, equipment, motor vehicle) that you require to earn
income from your occupation up to a value of $10,000.00.
Federal Legislation also allows you to keep:
In certain cases, the cash surrender value of life insurance policies (including some R.R.S.P.'s) where the beneficiary named is the spouse, child, parent or grandchild.
- In general, pension plans.
What About real Estate Assets?
The Trustee will examine the title documents to your home or any other real estate assets and determine if there is any equity belonging to you. This equity is an asset of your estate. If there is no equity in the property, the Trustee will release its interest in the property to the mortgage holders.
If you wish to stay in possession of the property, you can make arrangements to pay your mortgage.
If there is equity in the property, this equity will have to be converted into cash by the Trustee by way, for example, of a private sale to your spouse (assuming he or she is not bankrupt) so as to limit the impact of your financial circumstances upon your family.
What About My Car or Boat?
The Trustee will look at the value of the asset and any "liens" against it to see if there is any equity belonging to you. As in the case of real estate, this equity is an asset of your estate and the Trustee must realize upon it.
If there is no equity (or if the asset is leased), the Trustee will release its interest in the asset to the lienholder (or leasing company). You will have to make arrangements to continue payment obligations if you wish to maintain possession of the asset.
What about the Liens Against my Personal Assets?
Assuming that any such "liens" are valid and registered, you will have to deal directly with these creditors. The bankruptcy process generally does not affect secured creditors.
What Happens During the Bankruptcy?
The bankrupt must keep the Trustee informed as to where the bankrupt is living and also must respond to the Trustee's requests and assist him as required and provide whatever information is requested. The bankrupt must also provide the Trustee with reports as to earnings and living expenses and any change in the bankrupt's family situation. The Trustee will provide the bankrupt with appropriate forms to be filled in that will provide the Trustee with the necessary information. A meeting of creditors is not required unless requested by the Superintendent of Bankruptcy or creditors holding 25% of proven claims against you.
When is My Bankruptcy Over?
For those people who have not been bankrupt before, an automatic discharge will take place after nine (9) months, if the creditors, Superintendent of Bankruptcy or Trustee have not opposed your discharge and you have received mandatory counseling.
What Are My Duties Whilst in Bankruptcy Toronto?
You have a number of duties prescribed by law while you are undischarged. Some of these are:
- To disclose to the Trustee all of your assets and liabilities.
- To attend financial counseling sessions.
- To assist the Trustee in dealing with your property.
- To attend a meeting of your creditors.
- To attend an examination by the Official Receiver, if required.
- To keep the Trustee informed of your address during the bankruptcy
process. - To keep the Trustee informed of changes in your financial circumstances.
- Except in certain circumstances, not to borrow money without advising the lender that you are an undischarged bankrupt.
- Fulfill your obligations regarding financial contribution to your estate.
Failure to comply with your duties may interfere with your discharge from Canadian bankruptcy.
For us to quickly assess your situation, click on the assessment form
If you have made arrangements to meet with us, then you should download the interview checklist from the link below, fill it out and bring it with you to your interview
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This web site is designed to provide general information only. It is not intended to provide insolvency advice and should not be acted on without further consultation with professional insolvency advisors.
We welcome you to contact us with any questions you may have. This way we may address your particular concerns or circumstances
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Facing Bankruptcy ? Toronto trustee David Sklar and Associates serve the Greater Toronto Area and South Western Ontario