A bankruptcy is process with which Canadians can use as a last resort when debts are insurmountable. With a bankruptcy, you can discharge most, if not all your debts. In it, you’ll surrender your assets and pay off a small percentage of your debt from 9 months up to 26 months. Depending on your province, you may not have to forfeit all your assets (see exceptions).

When declaring bankruptcy, you’ll meet with a Licenced Insolvency Trustee (LIT) to identify the feasibility of your claim. You’ll need to provide proof of your monthly income, your debts and assets.

Bankruptcy is a legal tool that provides individuals and businesses with a chance for financial redemption. Understanding the types of bankruptcy, navigating the legal process with professional guidance, and using available support systems can help you get to a more financially secure future. Remember, bankruptcy is not a dead end; it’s an opportunity for a fresh start on the road to financial well-being.

Something to note is that a bankruptcy can be less than a consumer proposal but your creditors can ask to renegotiate the terms at any time. For example, a new job with a significant increase in income can be detrimental to your personal financial situation. You will have to report your income on a monthly basis.

Is a Bankruptcy right for you?

·      You don’t own your home

·      Your income situation will not change over the course of the bankruptcy

·      Your income situation may get worse over the duration of your bankruptcy

·      Your partner has a great credit history

·      You have low monthly income