Most debts are erased by the bankrupt's discharge from bankruptcy.
Most debts are erased by the bankrupt's discharge except for the following:
- Fines imposed by a Court;
- Money owing for things stolen;
- Things obtained by misrepresentation;
- 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 seven years after the finish of studies.
|By law, all actions against a bankrupt must cease once the documents are filed.|
Yes, they will! By law, all actions against a bankrupt must cease once the documents are filed. This does not apply to secured creditors such as banks holding, for example, a lien on a car.
The property exempt from seizure is set by the provinces and territories as follows: Exemptions.
The majority of 1st. time bankrupts are discharged in 9 months, at which time most of their debts are erased.
- 9 month automatic discharge for 1st. time bankrupts who fulfill all their duties and who do not have excess income. (Required monthly payment of less than $100.00 per month)
- 21 months (or more at the court's discretion) for 1st. time bankrupts who fulfill all their duties and who have excess income. (Required monthly payment of $100.00 per month or greater)
-24 months for 2nd time bankrupts who do not have excess income. (Required monthly payment of less than $100.00 per month)
-36 months for 2nd time bankrupts who have excess income. (Required monthly payment of $100.00 per month or greater)
-Bankrupts with personal income tax debt of $200,000.00 or more representing 75 percent or more of total unsecured claims, are not eligible for an automatic discharge. They must go to court for an adjudication.
|Unless you are a prominent person it is very unlikely anyone will know you have filed.|
In a bankruptcy, where there are significant assets, a notice is placed in the "legals" section of the newspaper notifying creditors of the date of the meeting of creditors. In most cases there are assets below this threshold, and the creditors are notified by mail only - there is no advertisement in the "legals" section of the newspaper.
|Your spouse, whether common law or married will not be affected by your bankruptcy if he or she is not responsible for any of your debt.|
Your spouse, whether common law or married will not be affected by your bankruptcy if he or she is not responsible for any of your debt (did not sign an agreement or contract for any of your debt). If they have a supplemental credit card they are probably responsible for that debt. Your spouse's credit rating will not be affected by your bankruptcy and any assets in the spouse's name will not be part of the bankruptcy.
If your spouse is responsible for any of your debt or has his own debt then the spouse may have to file bankruptcy too.
|One of the main purposes of bankruptcy is to give a person a fresh financial start.|
One of the main purposes of bankruptcy legislation is to afford the opportunity to a person, who is hopelessly burdened with debt, to free himself of the debt and start fresh - "a new lease on life." To go into bankruptcy it is necessary for a person to be insolvent. To be insolvent means to:
- Owe at least $1,000;
- Not be able to meet your debts as they are due to be paid.
|A proposal allows you to avoid bankruptcy, while paying off only a portion of your debts.|
Under the Bankruptcy and Insolvency Act, a trustee files a Proposal or an arrangement between you and your creditors to have you pay off only a portion of your debts, extend the time you have to pay off the debt, or provide some combination of both. To be acceptable, your creditors must be better off under a Proposal than if you go bankrupt.
Proposals are particularly useful in the following situations:
- Where the insolvent desires a "certain" result or a quick resolution and is prepared to pay a premium to achieve that result;
- Where discharge is likely to be contentious or a substantial condition is likely to be imposed;
- Where the insolvent finds bankruptcy unacceptable;
- Where the insolvent wishes to continue in business and will be prevented from so doing if obliged to disclose that he is a bankrupt when dealing with third parties;
- Where professional accreditation may be lost or put at risk by a bankruptcy;
- Where a bankruptcy will result in a secured creditor acting on its security;
- Where the insolvent wishes to retain some key asset (e.g. a home, heirloom, secret process or impending inheritance);
- Where the insolvent has previously been bankrupt.
|A person has to use a trustee if he or she goes bankrupt.|
A trustee in bankruptcy is a person licensed by the Superintendent of Bankruptcy to administer proposals and bankruptcies and manage assets held in trust. The trustee can give a debtor information and advice about both the proposal and bankruptcy processes and make sure that both the debtor's rights and the creditor's rights are respected.
|No. They cannot.|
No. They cannot. If your bank cancels or refuses to open a bank account for you because you have been or are in bankruptcy they are breaking the laws of the land.
|You have a number of options, and may even be able to file Canadian bankruptcy from that foreign country.|
You have a number of options, and may even be able to file Canadian bankruptcy from that foreign country.
For more information please refer to this link.
|Assets in excess of your allowed personal exemptions (set by your province) belong to the bankruptcy estate. Refer to: Exempt Assets|
In a bankruptcy, assets in excess of your allowed personal exemption, such as, real estate, automobiles and boats that are the property of the bankrupt as at the date of bankruptcy and anything that the bankrupt acquires during the bankruptcy vests in the trustee for the benefit of the creditors of the bankrupt. This would include inheritances received or to which the bankrupt might become entitled, by the death of someone during the time of the bankruptcy. It also includes such things as lottery winnings and anything that the bankrupt might accumulate, such as assets bought with any surplus income.
Tax refunds outstanding, as at the date of the bankruptcy, also vest in the trustee for the benefit of the creditors. Income Tax law requires a bankrupt to file two tax returns for the year of the bankruptcy. The first (pre bankruptcy tax return) covers the period January 1st through to the date of bankruptcy. The second (post bankruptcy tax return) covers the period starting with the date of the bankruptcy and ending December 31st. Pre and Post bankruptcy tax rebates vest in the trustee for the benefit of the creditors..
|The vast majority of people voluntarily go into bankruptcy.|
There are two ways a person can go into bankruptcy. The first and more common way is to have the person make an assignment in bankruptcy (voluntarily go into bankruptcy). The second, and rarely used way, is for creditors to ask the Court to make an Order that a person is bankrupt. In both these cases a Trustee in Bankruptcy is required to administer the bankruptcy.
|Depending on your income and family obligations you will have to make a contribution to the bankruptcy estate.|
There are standards supplied to the trustee by the Superintendent of Bankruptcy which instructs the trustee to collect funds, for the benefit of creditors, from any earnings above what is reasonable for the number of people in the family and the bankrupt's personal situation. In the vast majority of cases the cost of a bankruptcy is $200.00 a month for each of 9 months.
|It's the law in Canada that all legal action stops once a bankruptcy or proposal is filed.|
Once you file bankruptcy or a proposal you'll find that your stress will be gone.
You have taken a positive step to regain financial control over your life. Once the bankruptcy or proposal papers are filed the trustee takes over all dealings with your creditors. If a creditor or collector calls tell him you have filed and refer him to your trustee.
It's the law in Canada that all legal action stops once a bankruptcy or proposal is filed.
|No! So long as you are on any kind of payment plan the credit bureau will record this fact.|
No! So long as you are on any kind of payment plan the credit bureau will record this fact. Using a credit counsellor will not give you a better credit rating faster. In fact, you will likely take longer to re-establish a good rating and pay much more if you use credit counsellor rather than a trustee.
|You must take counselling in order to be discharged from bankruptcy.|
You must take counselling in order to be eligible for a discharge from bankruptcy and to complete your consumer proposal. The counselling can be one-on-one, with yourself and your trustee, or if you prefer, it can be in a group consisting of other bankrupts and your trustee. The first counselling session must be held between 10 and 60 days following bankruptcy; the second counselling session must be held no later than 210 days following the date of bankruptcy. The cost for this is $85, plus GST, for each individual counselling session..
|You must keep the trustee up to date and follow some simple duties.|
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 with an aggregate of at least 25% of the proven claims. These meetings are usually held at the office of the trustee.
|These payments must be kept up to date.|
Alimony or maintenance payments are not affected by bankruptcy. These payments must be kept up to date. A bankruptcy does not stop any actions for collection. Alimony and maintenance are provable claims and will be paid as a preferred claim for amounts incurred in the year before bankruptcy.
|Student Loans can be erased in a bankruptcy if the student was in school 7 or more years ago.|
Student Loans can be erased in a bankruptcy if the student was in school 7 or more years ago. This amendment will apply where the debtor obtains his or her discharge on or after July 7, 2008 (PROVIDED that at the time they filed they had ceased to be student for the required seven years) or the debtor had or becomes bankrupt on or after July 7, 2008.
The amendment that will reduce to five years the period a bankrupt will have to wait to make a "hardship" application to have student loan debt or obligation discharged (BIA , s. 178 (1.1)) is also now in force. This amendment applies to all debtors notwithstanding when the bankruptcy or the process that results in the bankruptcy is initiated.
|Tax debt is erased in a bankruptcy.|
Income tax debt is erased in a bankruptcy.
|In the vast majority of cases the cost of a bankruptcy is regulated by the government and is about $200 a month for each of 9 months.|
Trustee fees, filing fees and counselling fees are regulated by the government. The firms listed on BankruptcyCanada have a payment plan that allows you to pay the costs over time.
|You will get credit again after a bankruptcy or a proposal.|
You will get credit again after a bankruptcy or a proposal. We have a list of After Bankruptcy Lenders who will extend credit for mortgages, car loans, personal loans and secured credit cards.