Steps to Filing Bankruptcy
There are several steps to filing bankruptcy that must be followed. The steps are fairly straightforward, but you need to use the services of a Licensed Insolvency Trustee (formerly a bankruptcy trustee) to file bankruptcy in Canada.
This is a step by step guide to filing bankruptcy in Canada:
Step 1: The first step to filing bankruptcy is to admit that you need help. Some of the reasons people consider bankruptcy is they are unable to make their minimum payments, are receiving collection calls, are having their wages garnished, or have faced a sudden financial disaster.
If you are facing money problems that have led you to considering bankruptcy, the first step is to admit that you need professional assistance.
Step 2: The next step is to schedule a free consultation with a bankruptcy trustee to review your financial situation. The trustee will help you explore all options that could help solve your financial situation, whether it is filing bankruptcy or not.
Be prepared to answer questions about your assets, debts, income, expenses and family size as this will help the Trustee determine which solutions are best for you. Answering these questions truthfully will help your Trustee provide you the best advice. Your Trustee will give their advice, but the final choice is up to you.
Step 3: If you decide that you would like to file for bankruptcy, you will have to visit the Trustee’s office again to get the necessary paperwork.
The Trustee will help you fill out the paperwork if necessary. You might have to get certain information, such as a house appraisal.
The Trustee will use this information to fill out your bankruptcy paperwork and file it with the government.
Step 4: Once you have gathered all of the necessary information, you will go to the Trustee’s office to sign the bankruptcy documents. Your Trustee will answer any questions you have, and ensure that you understand what you are signing.
Once the documents have been signed, your Trustee electronically files the paperwork with the OSB (Office of the Superintendent of Bankruptcy).
The Trustee also sends your bankruptcy documents (whether by mail, fax, or e-mail) to your creditors, which notifies them you are bankrupt and have certain protections under the law. Once your bankruptcy documents are filed with the OSB, you are officially bankrupt, and the Stay of Proceedings goes into place.
Step 5: During bankruptcy you must complete certain duties, such as attending the two required credit counselling meetings, paying the trustee each month, assisting the trustee if they ask, and surrendering any assets not protected to the trustee.
Step 6: At the end of the 7th month of your bankruptcy (or later if it is your second bankruptcy) your Trustee will calculate your average income to see if you have surplus income payments required.
Step 7: At the end of 9 months (or later in a second bankruptcy or if you have surplus income) you will receive your bankruptcy discharge if you have completed all of your duties. When your bankruptcy is over your debts will be discharged.
Step 8: Your bankruptcy is over and you can begin rebuilding your credit!
Let Us Help You
Bankruptcy is a legal process that requires the services of a Trustee who is licensed by the government. If you are considering bankruptcy please contact one of our local Bankruptcy Canada Trustees to schedule a free evaluation. The initial consultation meeting is free, confidential, and carries no obligation. We can help you choose the right solution for your debt problems.
Contact a Government Licensed Trustee
Contact a local Insolvency Trustee today to schedule an evaluation to review your options.