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Wes Cowan: Chartered Insolvency and Restructuring Professional, Trustee in Bankruptcy
In the past 11 years I have met many people who found themselves or their businesses in financial difficulty. Finding solutions to these problems is what I enjoy doing. As a former employee of the Canada Revenue Agency (“Revenue Canada”), I can offer unique insights on tax related debt. Having lived and worked in both rural and urban settings, I understand issues that are particular to each. My family and I call Kitchener home, where I continue to serve our area’s residents as Trustee. If you have concerns about money and need help call me for a FREE CONSULTATION. 519.725.3829
747 comments:
1 – 200 of 747 Newer› Newest»If i decide to register bankrupty will I lose my vehicle. I purchased the vehicle in july of 2006 and have been making the monthly payments.
If you have been making all of your required payments, it is most likely that you will be able to keep your vehicle.
Kind regards,
Elizabeth Fleming, CIRP
I currently have over $50,000 in debt and barely making ends meet and am considering bankruptcy. What do I have to do?
I am so embarrassed - I have gotten myself into debt bad and don't know what to do. I am afraid my mom will know. What can I do??
I filed for bankruptcy in July 2006 and my trustee tells me that I have to pay more than he told me when I signed my paperwork. Why am I being punished as I earn an okay income?? Why am I not getting done in 9 months as I was promised??
March 1 Question "I currently have over $50,000 in debt and barely making ends meet and am considering bankruptcy. What do I have to do?"
The best step you can take at this point is to call us (1-888-PwC-Debt) and make an appointment for a free consultation. We will sit down and review your situation with you and let you know what your options are as bankruptcy may not be the only choice you have. We will give you all of the information on your various choices so you can make an informed decision about your debt. If bankruptcy is the option for you, we will help you fill in the application to start the process.
I look forward to talking to you!
Regards,
Liz
Julie S. said...
I am so embarrassed - I have gotten myself into debt bad and don't know what to do. I am afraid my mom will know. What can I do??
Hi Julie,
Thanks for your blog entry. First and foremost, please do not be embarassed about your situation! Thousands of Canadians find themselves in the same position each year. The most important thing is that you recognize that you are debt and are taking steps to fix it.
Now, as for your Mom, usually the only people that will be notified of your bankruptcy are your creditors and the government so you don't have to worry about Mom finding out.
While you don't have to, you may want to tell your mom about your financial situation anyways. She probably already has a good idea - Mom's are usually smart that way :-).
Hope this helps. Don't hesitate to give us a call if we can answer any more questions for you.
Regards,
Liz
Anonymous said...
I filed for bankruptcy in July 2006 and my trustee tells me that I have to pay more than he told me when I signed my paperwork. Why am I being punished as I earn an okay income?? Why am I not getting done in 9 months as I was promised??
This is a hard question to answer as need to know a few more details to make sure I am giving you the correct response.
I believe that the payments you are being asked to pay are for "Surplus Income". In Canada, the bankruptcy system is designed so that someone who makes a large income pays more back to their creditors than someone who makes a small, modest income. Your trustee is probably asking that you pay some additional payments as you have "Surplus Income" and have the ability to pay something to your creditors.
Rather than thinking that you are being punished, think about the amount you are being asked to pay and compare that to the amount of debt you are getting rid of through your bankruptcy. Probably siginficantly lower and a "better deal"!
If I claim bankruptcy and have a 25,000 loan on a car worth 10,000 will I lose the car ? in total I owe about 38,000
any help would be great thanks
Jack
Hi Jack,
Good question! You can do a few things in this case...
1) You can continue to make your car payments to the secured creditor. Most secured creditors are willing to work with people whom have filed for bankruptcy although we cannot guarantee it.
2) Do you really want to pay $25,000 for a car that is worth only $10,000? Discuss this with a Trustee during your free consultation and they can probably give you some good ideas!
Further, in Ontario, there are laws that allow a person to keep a vehicle no exceeding $5,650 in vlaue assuming it is unencumbered (or has no loans/liens against).
Hope this helps! Please do not hesitate to contact us again if you have more questions.
Kinds regards,
Liz
Can you answer this question for me regarding garnishment:
I currently am seeking a trustee and have several Provincial garnishements taken off me at work (20% of my wages) I owe Revenue Canada a large amount and they have just sent me and my employer another garnishment for 30%, my employer called them and they told my employer that they can deduct both amounts. I called the Provincial office where my other garnishments are at and they told me that Federal takes precedent over theirs. How can I get my employer to only take off the 30% and not 50%. I am trying to give them that information and have them call the Provincial office and am not sure where to turn., thanks, Hank
Hi Hank,
Your question... "How can I get my employer to only take off the 30% and 50%". The only party who can alter the amount being deducted is the garnishing party, in this case the government.
I would suggest that you see a Trustee as soon as possible as Trustee's are the only professionals in Canada who can legally get the garnishment from both levels of government stopped! The sooner you develop a plan with Trustee to deal with your financial situation, the sooner the garnishments will stop and you will receive your full paycheque again.
Please do not hesitate to call us at 888-PwC-Debt (888-792-3328) so we can help you out.
Kind regards,
Elizabeth Fleming, CIRP
I was discharged from bankruptcy in April 2001, and 6 years have now passed. The one Canadian credit bureau has told me that they will remove the bankruptcy from my credit file, however the other Canadian credit bureau insists that the waiting period is not over. Is 6 years the legal limit in Ontario? If so, what can I do to get the other Canadian credit bureau to remove the bankruptcy from my file? Thank you very much.
Hi,
Thanks for the question. If this was your first bankruptcy, the reporting time on your credit report is 6 years from your date of absolute/automatic discharge (not your date of bankruptcy). For second time bankruptcies, the period is longer.
There are two credit reporting agencies in Canada - Equifax and Trans Union. Both are very familiar with the bankruptcy laws. If you were told something other than the above by one of these agencies, it may be that the person you were talking to is not familiar with the law. I suggest that you call them back and if you get the same answer, ask to speak to a supervisor whom will be more familiar with the law.
My limited company failed about a year ago. I was the only shareholder and director. I have creditors after me for personal guarantees ($30,000) and most worrisome of all I have Revenue Canada saying that I am personally responsible for the unpaid GST from that failed corporation in the amount of $40,000.
The collector at Revenue Canada told me that a bankruptcy would NOT erase the GST debt owed by me. Is that correct?
Thank you,
Worried in London
.a.
Hi Anonymous,
Good news! The information you have received from Canada Revenue Agency is incorrect.
If you file for personal bankruptcy (or a proposal), your liability as Director for the GST of your limited compnay is 100% included and forgiven once you obtain your discharge.
Should you have any further questions, please do not hesitate to contact our office at 888-PwC-Debt.
Kind regards,
Elizabeth Fleming, CIRP
I have to file bankruptcy. I do not work. Our only source of income, is my husband’s earnings. My husband is not filing for bankruptcy. Does his income effect the bankruptcy at all?
I have no bank account, only share with my husband. Do I need to provide my husband’s bank account number? We have no savings or anything in there, he just gets his pay through the bank and we take it out to pay bills, etc. Will the money left after bills and everything be taken away each month?
If you are currently not working and have no income, you are judgement proof so creditors have limited options to pursue you for payment of your debt. You should talk to a Trustee about whether or not you really need to file for bankruptcy.
As for your husband's income - his income is his income and will likely not impact your bankruptcy at all. Realistically, if you are not working, the only amount you will have to pay is for the Trustee's fee which can be set up in reasonably monthly payments upon discussions with your Trustee.
Hope this helps!
Regards,
Elizabeth Fleming, CIRP
I have unfiled tax returns and income tax owing, as well as unremitted GST from the same sole proprietorship. If I file for bankruptcy after filing my tax returns and totalling all Revenue Canada debts, do any survive the bankruptcy filing? Is unremitted GST treated differently than unpaid income tax, on a sole proprietorship? As well, my small RRSP is under a seizure order (from the unpaid GST issue) if liquidated, but my bank tells me RevCan cannot force its liquidation, only capture the proceeds if I voluntarily redeem it. After bankruptcy filing, what happens to the RRSP?
Thanks
I have to declare bankruptcy. My debts are at 20,000. I have about 15,000 in home equity but I cannot make a proposal because now I am only working for minimum wage and living paycheck to paycheck. Once I start the process, how long do i have to vacate the house?
Thank You,
Me
Hi Anonymous,
So to summarize - you have $20,000 in debt but almost $15,000 in equity in your home.
There are a few options for you and a Consumer Proposal is still definitely one!! We have filed proposals where the equity in the home is offered to creditors in full satisfaction of there debt. The home is put on the market by the owner and any funds received from the sale are offered to the creditors.
You may also want to talk to a mortgage broker whom may be able to help you get the equity out of your home to settle your debts.
Based on the limited information you have provided, I don't think that bankruptcy is the route for you!!
If you do decide to leave your home, the mortgage holder must make application to the Court to sell the home. This will likely take several weeks.
I encourage you to talk to a Trustee as there are more options out there than you probably realize that are probably better for you than a bankruptcy :-)
Hope this helps.
Kind regards,
Liz
Hi Anonymous,
Thank you for your questions regarding income tax liabilities from a sole proprietorship. Please refer to my post on April 23, 2007 at 10:06 am for further details.
Any tax liabilites which you have - personal income tax and directors liability for GST or source deductions are forgiven by a bankruptcy - they do NOT survive. GST and income tax are unsecured claims in your bankruptcy. A certain portion of any source deductions owing have a "priority" and CRA will be paid first on this amount from the funds available in bankruptcy.
As for your RRSP, in a bankruptcy this would be collapsed by the Trustee for the benefit of your creditors.
Hope this helps. Should you have any further questions, please do not hesitate to contact our office at 888-PwC-Debt.
Kind regards,
Liz
Since my father passed away in Jan 05, my brother and I have become joint signers(either/or) on our mothers accounts and investments.These monies were totally earned and saved by my parents. It is just a precautionary measurement in case of illness. Are these funds protected if my husband and I file bankruptcy. Thanks
Hi Ozzie,
Any assets or accounts which you have co-signed for are considered to be your assets and will need to be reviewed by the Trustee.
In this case, I would highly recommend that you seek legal advise before proceeding.
Regards,
Liz Fleming
Trustee
I claimed Bankruptcy (Conditional)in '02 and thought everything was finalized, I have just found out that it was not completed. My trustee now wants more money to finish what was started. I feel like I have been set back 5 years.
Any suggestions?
Good morning,
If you received a Conditional Order of Discharge, it is actually the Court that has determined the amount you have to pay based on the facts of your bankruptcy. The Trustee is just responsible for enforcing the Court Order at this point.
So... to get your discharge, you have two options:
1) You can pay the Conditional Order of Discharge as set by the Court; or
2) You can hire a lawyer to make an application to Court to get the terms of your Conditional Order of Discharge varied. Your request for a change to the Order may or may not be granted.
Hope this helps.
Liz Fleming, CIRP
I am an undischarged bankrupt - none of my debts are student loans. I want to go to university full-time, and I have relatives who will pay my tuition. However, I am concerned that my creditors will seize the funds as a windfall or gift. Please advise.
If I claim bankruptcy, what will happen to the CST fund that I have contributed to for my children's education? Will they lose anything I have saved? I have put small amounts away since they were born.
Anonymous said...
I am an undischarged bankrupt - none of my debts are student loans. I want to go to university full-time, and I have relatives who will pay my tuition. However, I am concerned that my creditors will seize the funds as a windfall or gift. Please advise.
Hi Anonymous,
While you are in bankruptcy, you have to disclose all income to the Trustee - even if a gift from someone to pay for your tuition. This does not necessarily mean that you will lose the "gift". You should discuss this situation with your Trustee in person as there are factors to be considered and proper advise cannot be given with the limited details provided. In a nutshell though, it is unlikey that the Trustee will seize the fund for your tuition.
Regards,
Liz Fleming, CIRP
If I claim bankruptcy, what will happen to the CST fund that I have contributed to for my children's education? Will they lose anything I have saved? I have put small amounts away since they were born.
Hi Anonymous,
If the RESP is in your name, techically it is your asset even though the funds have been saved your childrens education.
I encourage you to talk to a Trustee in person as there are options available which may permit you to keep this asset including purchasing the "net" value of the RESP from the Trustee.
Hope this helps.
Liz Fleming, CIRP
My husband and I are considering filing for bankruptcy. I have "Locked in" RRSP's from a previous pension plan and RESP's for my children. Would I loose these if we filed? I haven't been able to touch the locked-in RRSP's to help alleviate our debt.
Thanks
Hi,
For your Locked In RRSP (pension roll over), the asset is normally exempt from seizure and will not taken from you in a bankruptcy. The Trustee will ask to see paperwork to confirm the locked in status.
As for your RESP's, I refer you to my post on June 3, 2007 at 7:47 pm.
Hoep this helps. If you have any further questions, don't hesitate to give us a call.
Kind regards,
Liz
Thinking of filing bankruptcy--currently have house trailer financed, leased vehicle and mortgage but have never missed payment on these. Husband lost job and I was laid off but I am back to work now--accumulated about $38 000 in credit card debt, can i file bankruptcy just for the credit card debt becuase now we can not make these payments and am constantly getting calls from them. Tried getting a debt consolidation loan from banks and can not get any help anywhere--what can we do? Is there help for consolidation from somewhere else that I can try even though my credit is going down the tubes and am completely maxed out?
Hi Louise,
When you file for bankruptcy (or a proposal), all of your creditors are advised. Your mortgage, car loan and trailer financing are "secured creditors". If you file for bankruptcy, and are able to continue the payments on these debts, you should be able to keep these assets.
If you continue to pay these secured creditors, essentially the credit cards are the only debt which will be dealt with in a bankruptcy, even though your secured creditors will have notice of your bankruptcy.
There are exceptions to the above rule though so I encourage you to talk to a Trustee who can get all of the details about your personal situation and will let you know specific options just for you.
Hello
I filed bankruptcy in 2006 and received my discharge in 9 months(in 2007)My income tax for 2006 went to the trustee and they kept the refund as I expected. Could you tell me who will receive my 2007 tax refund, if any for 2007? Also after discharge can I have RRSPs, savings account, transfer money from a previous employee pension plan to a locked in Lif etc. at my bank if I want?or do I have to leave it as not to generate a surplus income, if any over the government allowable cap. Thankyou
You are entitled to your 2007 income tax refund. It may be mailed to the Trustee's office but they should in turn mail it to you.
As for RRSP's, savings etc., you are absolutely entitled (and encouraged!!) to have these accounts once you have been discharged from bankruptcy. Once you have been discharged, you no longer have to worry about "Surplus".
Hope this helps.
Liz
I am an American who lived in Canada for over 20 years but have moved back to the U.S. I have over $15,000 in Canadian debt. I had been making payments but can't anymore as I barely make my monthly living cost down here. I wanted to claim bankrupt in Canada, but was told I have to live in Canada to do that. The only assets I still have in Canada is approx. $2500 in RRSP's. Please help, the phone calls asking for payment are non-stop!!!
Hi Mark,
Interesting question! I did some research for you but have not been able to obtain a clear and definitive answer. I would suggest that you contact the Office of the Superintendent of Bankruptcy. This is the government agency which regulates bankruptcies in Canada. They may be able to better advise you.
Regards,
Liz
We claimed bankruptcy in Aug/06 and was discharged in May/07,after 9 months meeting all of our obligations with nothing further owing to our trustee. We did sign to have the trustee prepare and keep 2006 tax refunds. Am I correct in thinking that we are entitled to our post bankruptcy(2007) tax refunds? Also I checked my E-pass account at CRA and found out that the trustee is authorized until Aug/2009. We thought we had authorized them to represent us in the 2006 bankruptcy year,(as they requested). Were we misled and if so is that legal? Can we have them removed as our authorized representative now that we have an absolute discharge? Thankyou
Hi,
When you filed for bankruptcy, you probably signed an "Assignment" of your "Post" bankruptcy income tax refund to the Trustee for the benefit of your creditors. Your post bankruptcy return covers the period from your date to bankruptcy to December 31, 2006. The Trustee will keep this refund to help pay your creditors and estate costs.
For your sebsequent years (2007 and onwards), the Trustee is not entitled to keep these funds unless you gave her permission to do so.
It is totally, 100% normal for your tax refunds, GST credits etc. to be mailed to the Trustee for a year or so after you are discharged as the Trustee still has work to do on your file - just because you are discharged does not mean that the work on your file stops.
Only once the Trustee is finished your file, and has received a "Trustee Discharge" will your refunds go directly to you. Please don't worry, this is normal. Your Trustee should mail you any income tax refunds she receives.
Hope this helps.
Liz
Hi there. I have a couple questions for you. First of all, I claimed bankruptcy a couple years ago with BDO. Problem is I was still in financial debt and having problems so I missed a few payments and also a counselling session so I am still in bankruptcy. But since then I have a few more debts and I was wondering if it was possible to reclaim and start all over my bankruptcy from now???? I would rather not go back to BDO because I am very embarassed about what happened before and I would rather deal with a different company if I can. I have an insurance company suing me for 20,000 amung a few other stuff and of course all the others I claimed in the first place. I now make a little bit more money and I could come up with the money for the bankruptcy now... Anyhow if you could email me back and let me know how to proceed I'd appreciate it as I work shifts and its hard to reach me by phone... Thanks for your help!
Hi Kelly,
For your bankruptcy - please don't worry, or be embarrassed about not initially completing your duties. The important is that you now want to take care of them. As BDO is your Trustee, you have to continue with them - you can't switch part way through or "restart" your bankruptcy. Give them a call and they will let you know what you have to do. Depending on how long ago you filed, you may be charged a fee to reactivate your file.
As for yor current debt, you have to finish your bankruptcy which is dealing with your old debt before you can deal with your new debt.
Hope this helps,
Regards,
Liz
Hi Elizabeth,
I hope this doesn't sound stupid, as I know nothing about bankruptcy, but am currently growing more and more in debt and are now considering bankruptcy.
I owe 15,000 on my car that is way over my head. But I drive for a living and would need this vehicle to continure working. Now... if right before I claimed bankruptcy... I purchased a cheaper get around car with my Visa. And then claimed bankruptcy, (losing my 15,000 Car). Would I be aloud to keep my new cheaper car, and is that legal?
I hope I explained myself correctly, thanks.
I had to file Bankruptcy 17 years ago and I was fully discharged. If I were to declare it again what would to happend. Thanks
Good morning Anonymous,
For your second bankruptcy, the main difference from your first bankruptcy is that you do not qualify for an automatic discharge after 9 months. The Court will determine when you should be discharged based on your personal facts and the reasons for your bankruptcies. Typically, your discharge is suspended by the Court for a period of 3 months depending on your personal situation. Other than that, there are not many differences between a first and second time bankruptcy. When you meet with a Trustee, they can give you all the details in person.
Hope this helps!
Liz Fleming
My now exboyfriend "gifted" me with a computer, 2 1/2 years ago, and has since filed bankruptcy. He financed the computer with Dell Canada, through his business. He now says that they want to repossess the computer, and he told them that he doesn't have it, and told them where it was located, gave them my address and email address. I have received an email what i believe is a third party that collects for Dell, asking me to call them and arrange for return of the computer. Do I have any recourse regarding this? How likely is it for a computer to be repossessed when it is over 2 years old, well used, with some damage? I understand that it can't be repossessed without a warrant (correct me if I am wrong about this). I appreciate any advice that you can give me on this matter, thank you.
I filed bankruptcy in Nov.'06 and the trustee did my taxes for that year and I did not get any of my refund. What happens to my tax return that is for 2007? Will I get to keep that money or will it go to the trustee as well because I was in bankrupt for 8 months of the year.
Our company is going through some poor cash flow issues and have more debt than we can pay off in the near term. Our business continues to grow, but our debt load is hurting us.
Can bankruptcy protection help us while we sort out our issues?
Hi everyone,
Just a quick note to let you know that I am away enjoying some summer holidays. I will return to the office after the Labour Day weekend and will respond to your posts then.
Kind regards,
Liz Fleming
Hi Anonymous,
Further to your question... "I filed bankruptcy in Nov.'06 and the trustee did my taxes for that year and I did not get any of my refund. What happens to my tax return that is for 2007? Will I get to keep that money or will it go to the trustee as well because I was in bankrupt for 8 months of the year. ".
Please take a look at my post on June 25, 2007 (9 pm).
You are most likely entitled to your income tax return.
Kind regards,
Liz
Hi Robert,
To refresh, your question was "Our company is going through some poor cash flow issues and have more debt than we can pay off in the near term. Our business continues to grow, but our debt load is hurting us.
Can bankruptcy protection help us while we sort out our issues?"
Robert, this is a fairly complex question which will be quite challenging to answer without knowing alot more about your company. Generally, bankrupty is best suited for companies whom will be closing down.
A proposal, a notice of intention to file a proposal or CCAA protection are probably some of the better options for companies with cash flow issues. There are also informal options which a Trustee can also help you with as well which may be a better option, depending on the status of your company.
The best piece of advice I can probably give you is to book an appointment to meet with a Trustee in person to discuss the Company. Most Trustee's will do a free initial consultation for you. Be prepared to bring your up to date books and records with you so they can give you some good advise. Without up to date info, it is very hard to provide you with appropriate advice.
David Flett in our office is very familiar with company restructurings and may be able to help you.
Kind regards,
Liz Fleming
We (my husband and myself) will have to file bankruptcy, soon. The house will be sold soon, but will not make enough money to pay what is owed. A proposal doesn't seem to be the answer since there isn't enough money coming in to pay the remaining balances with.
My question concerns this; he is currently involved in an appeal process/lawsuit involving a fight for back wages and future loss of wages, which has been going on for a long time now. (this is the current and only reason for us having to file bankruptcy...there isn't enough money coming in to pay what we owe. We owe more than twice as much than is coming in. Not even enough to live on. $1000.00 per month. I am currently not working at my part time job due to recent surgery and it is not known when I will be able to find new employment. I do not qualify for sick or regular EI. We will have to move in with parents.) Should the outcome be successful, a substantial amount of money will become owing to him. Will the bankruptcy be able to seize some or all of this payout? If this settles within the 9 months, do we lose it all too? If by losing this money and it gets put towards what is owing (about $40,000), then we filed bankruptcy and still had to pay everything owing??? Is not the purpose of filing bankruptcy supposed to stop you from paying these creditors? If not, then filing bankruptcy was all for nothing??? The only one to have gained anything from this long and dragged out fight being the lawyer and bankruptcy proceedings?????
Most of the bankruptcy proceedings are clear, however the "fine print" regarding lump sums, is not made clear enough.
Thank you in advance for your much appreciated advise on this confusing matter.
Hi Anonymous,
You have asked a question which has several parts to the answer. I will start with your comment "Is not the purpose of filing bankruptcy supposed to stop you from paying creditors".
The purpose of bankruptcies and proposals is to provide an "honest but unfortunate" debtor relief from their financial burden. In order for your debts to be discharged (or forgiven), the bankrupt is expected to comply with certain duties in "exchange" for this relief. This is designed to make bankruptcy a fair process for both the bankrupt and the creditors.
One of the required duties is to turn over your non-exempt assets to the Trustee which in turn are "sold" or realized upon by the Trustee for the benefit of your creditors - so they can get paid back a portion of the money you owe them. Your non-exempt assets includes any lawsuits.
Based on the information you have provided, there are two different components to your lawsuit - one part is for back wages and one is for future wages. These two components are treated very differently and are too complex to endeavour to explain here.
In short, the answer may vary and depends on the outcome of your lawsuit and the breakdown of the funds paid but it is likely that you will be expected to pay some of the money to a Trustee in "exchange" for relief from your debts.
I hope this helps.
With profits from the sale of the house being around $15,000.00, and the amount owing out being between $35,000.00 and $40,000.000, is it at all possible that a proposal could be accepted by the creditors? One of those debts includes a vehicle that would have to be surrendered, as it is secured. The amount owing on it is a little more than the sale of the house profits, and the vehicle may only be worth about half of that.
If a proposal would be logical and is made and not accepted, then would the only other option be bankruptcy? Since not enough money is there to cover anything.
Thanks much!!
Hi Anonymous,
The good news is that you can most certainly try a proposal! Creditors will often accept a proposal even if the same funds were to be available in a bankruptcy as the trustee's fees (which are set by the federal government and are the same for every trustee across Canada) are lower in a proposal (vs a bankruptcy) so there may be a higher payout to creditors. As well, in a "lump sum" proposal, creditors often receive their payment faster than they would in a bankruptcy when they often have to wait as long as a year to get paid. Two great reasons for creditors to consider a proposal.
When you meet with a Trustee, they will go over your assets and liabilities in detail and then let you know about your options. In this case, a proposal could most certainly be considered once all the facts are reviewed.
Kind regards,
Liz
I am an independent truck driver who owns his own truck who is leased on to a transport company.
I have a garnishment towards my income that is to commence shortly for credit cards that I am not able to to catch up on amounts owing.
According to the information that I have been given this cannot be enforced as I am not an employee of the trucking company and also not on salary, but paid by the miles I drive.
My checks are are made out to my company and not to my own personal name.I am a propertership business and the garnishee is on my personal name.
Is this garnishee able to be enforced
Hi Ray,
Unfortunately, I am not a lawyer so I cannot give you any legal advice regarding your garnishment and it's enforceability.
I can provide a few comments though...
As you are a sole proprietor, you and your company are one and the same. The fact that your cheques are made out to your Company will likely not make the garnishment unenforceable. This would only be the case if your company was a legally incorporated company.
What can be garnished will depend on the Court Order giving your creditors permission to garnish. It might say they have the right to garnish your bank account or wages, or both.
As you are struggling with your debt, I encourage you to speak to a Trustee face to face as only a Trustee can legally stop the garnishment. People often think that bankruptcy is the only way to stop a garnishment but a proposal to your creditors will also stop the garnishment.
I hope this helps.
Liz
Hello;
We are thinking about filing for bankruptcy but I have a couple concerns.
1. We have a leased vehicle that has one more year of lease on it. Will we lose that?
2. We rent a house. Is that affected?
3. Most of the credit cards are in my husband's name. I am only on one of the cards. How would we work this? I have two cards in my maiden name also.
4. My husband is unemployed at present and I am on maternity leave. Can we file now or do we have to wait till I return to work?
Hi Linda,
Good questions!
1) For you leased car, it you have been making the monthly payments as required you should have no problem keeping the car. If you want to get out of your lease before it expires, a Trustee can explain some options that you have.
2) For your rental home, as long as have been making your rent payments each month, you should have no problem. If you are in arrears, advise the Trustee of this. This does not mean you will lose your rental but there are issues which need to be reviewed.
3) If you only have one joint debt, you will likely not be able to file a joint bankruptcy (it depends on the amount of the joint debt in relation to your other debts). Each of you may have to make your own bankruptcy filing. As for your maiden name, let the Trustee know and she will put a AKA (also known as) on your paperwork with your maiden name.
4) You do not have to be working to file for bankruptcy.
Hope this helps. If you have any further questions, please do not hesitate to give us a call.
Kind regards,
Liz
Hi Elizabeth;
Thanks for returning a comment but I have a couple other questions.
1. We have RESP for our girls. Will we lose those?
2. I have an RRSP. Will I lose that?
3. My credit cards are only 3500.00. Should I file also? The joint debt is about 16,000.00. Should we file jointly?
Thanks again. We are going to file but these questions concern us.
Linda
Hi Linda,
Most of the questions you have asked cannot be accurately answered without reviewing your financial situation and assets in more detail. There are several possible answers to most of your questions.
When you have your initial consultation (which is free), we will be able to answer these questions for you. When you do have your appointment, please ensure that you bring your credit card stmts, any stmts for RESP or RRSP's, and your most recent bank stmt so we can give you the best possible information which will include the options available to you to resolve your financial difficulty.
Hope this helps.
Liz
What are my legal rights dealing with a bailiff do I have to let them in my house while they are acting on behalf of a secured creditor? I am having a hard time paying back a small loan I am honestly trying to pay the loan off but am having a hard time trying to pay off my other bills I am barely left with enough I barely live from paycheck to paycheck.
thanks
My boyfriend and I are from Nova Scotia and are considering bankruptcy. This is the only site we have found like his so we were hoping you could help. We have a truck that we leased in 05' and have not missed a payment. His name is on the lease and I am his co-signer. If he was to register for bankruptcy, would that debt still fall back on me, and will they treat a lease the same as if you own your vehicle...
Hi Anonymous,
Regarding your question - "What are my legal rights dealing with a bailiff..." Unfortunately, I am not able to answer your question as I am not a lawyer. If you are struggling with your finances as you are living from paycheque to paycheque, I can give you suggestions for budgeting and how to restructure your debt. If that would be helpful, please do not hestitate to call. Otherwise, I suggest you contact a lawyer in respct to your legal rights concerns.
Kinds regards,
Liz
Hi Anonymous,
If you have co-signed the lease, they will look to you for payment - whether it be the monthly lease payment or the shortfall if the vehcile is repossessed and sold.
For your question... "will they treat a lease the same as if you own your vehicle", I assume you mean in a bankruptcy?? There are differences between owing a vehicle and leasing one and the laws change from province to province. Some provinces have exemptions which allow you to keep a car up to a certain value if you own it. I would suggest you call a Trustee close to you to find out the provincial rules. In Nova Scotia, we have many offices which can be reached by calling 888-PwC-Debt (888-792-3328)
Hope this helps.
Liz
I am considering personal bankruptcy.
My wife and I jointly own our home. I have two credit cards...one of which she has a supplementary card for.
She has one card which is totally separate from my accounts.
Will she be forced to declare bankruptcy as well because of the supplementary card?
Also, will we be forced to give up our leased car if we can continue to make payments during the bankruptcy (it is used to generate income as I am self employed.)?
The lease agreement contains one statement saying that bankruptcy will lead to default but can the lessor force me to default if I am making the payments ?
Thanks
Hi Anonymous,
If your wife has a supplementary card on one of your accounts, the odd's are good that she accepted financial responsibility for this account. Theywill liley look to her for payment on this account should you file for bankruptcy. Whether or not she will have to file for bankruptcy, I can't say without doing a thorough review of her financial situation. She may be able to pay the bill or she may qualify to file a proposal to her creditors.
For your car, with most leasing companies if have not missed any payments and you can maintain the lease payments, they will likely let you keep the car. I cannot guarantee this though as they are entitled to enforce their lease terms should they want to. In reality, they will like make a greater amount of money from you if they continue to accept your lease payments rather than repossessing the vehicle.
Hope this helps.
Liz
I am the sole proprieter of a federally and provincially incorporated business. The business has been in operation since January 2006. I have not yet filed any taxes (GST, Income) or submitted any payroll witholdings (EI, CPP). My company is suffering now and I do not think I will be able to afford to pay any of the above (I have lost all contracts and any attempt at new business has failed), leaving me with the only option of declaring the business bankrupt.
I have a few questions. Will doing this eliminate the tax and payroll debts and will this have any inpact on me personally (i.e. my credit rating, can they go after any of my personal assets)?
Thank you for your help!
Thanks,
B
Good morning,
If an incorporated business files for bankuptcy, any liability of the company for PST, GST and source deductions will be covered by the corporate bankruptcy. All outstanding returns will need to be completed to determine what this amount is.
As a director or officer of the company, you are also peronally liable for any unremitted PST, GST and source deductions.
Most often when a company files for bankruptcy, if the tax accounts are not current, the director (likely you) also consults with the trustee about their personal financial situation as well due to these liabilities.
Hope this helps.
Liz
What are the rules on receiving monetary gifts after an absolute discharge has been granted by the courts?
Good morning,
If you have received your Absolute Discharge, any gifts (montetary or otherwise) are yours to keep.
Kind regards,
Liz
Hi there. I have found myself with credit card debt totalling $10,000. I am retired and live only on a pension. I had partime work when I acquired the cards but that has now ended due to my age. I have called a trustee for an information kit and researched my options. I have been to credit counselling but was not able to live on the balance after the budget was complete. I am wondering if I should even file bankruptcy at all if my pension income cannot be garnisheed. I was quoted $175.oo per month to the trustee for filing but his leaves me with little to live on. What are my options as my accounts are now 3 months overdue.
Help!!
Hi Anonymous,
You have asked if you should file for bankruptcy. It is hard to give this advice over the internet as I do not have all the details. I can offer some general advice though...
1) If you are unable to pay your debts, then yes, bankruptcy is always an option. This option comes with pro's and con's. You should discuss these in person with a Trustee. They will be able to tell you the pro's and con's for you, once they know your personal details. You should also talk to the Trustee about being Judgement Proof when considering whether or not you should file. Being Judgement Proof does not stop the phone calls and letters and you may still have to appear in court (if you are sued by a creditor) to explain your situation and why you are not paying the debt.
2) Yes, there is a cost to filing for bankruptcy. If you cannot afford to pay these fees, you may want to consider contacting the Office of the Superintendent of Bankruptcy regarding their Bankruptcy Assistance Program. If your income is below a certain level, you may qualify for this program. To qualify, you will need to meet with two Trustee's in person to review your income and situation and they will sign off on whether or not you qualify for the program. The OSB will then assign you to a Trustee whom will work with you on your bankruptcy. You will still be expected to pay a portion of the fees based on your level of income. If your income is app. $1,400 a month or higher, you will likely be asked to pay the full fee. You may also ask the Trustee if they would possibly consider using your GST credit and tax refunds to pay your fees. Not all Trustees do this, but some may after a review of your personal situation.
I would recommend that you speak with a Trustee in person so that you can get the best possible advice for your personal situation.
Can you tell me please if I am obligated to turn in a credit card with a zero balance if I have put it away do not use it. I am planning on filing and understand that my cards will be turned in. The card I am inquiring about is only a small amount and is clear.
Thank you also for your last advice and you have helped me and my nerves considerably to make up my mind.
Thank you,
Hi,
One of your duties when you file for bankruptcy, is to turn over all of your credit cards to the Trustee. This includes accounts which have no balance.
Hope this helps.
Liz
hi i was wndering if i want to claim bankruptcy will this affect me getting osap to go back to school because I have a car loan right now and I know that i can afford it now. I really want to go college and get my education. N ow the fact that I am only 19 years of age and i still have enough time to clear this off my record i believe it would be the right thing for me to do. What are your thoughts on this?
Hi Street,
Being bankrupt should have no impact on your OSAP. Quite often, OSAP will ask for a letter from the Trustee to confirm that the funds they give you will not be taking by the Trustee to pay creditors. This is a normal letter which the Trustee sends out.
As for whether filing for bankruptcy is right for you, I can't answer without knowing alot more about your financial situation and I would want to make sure it is indeed the right decision for you before I gave out that kind of advice.
Have a great weekend.
Liz
If I have a court imposed judgement against me personally, with filing personal bankruptcy will there be any liability for this afterwards.
ie. does it matter if I file bankruptcy before or after a judgement for payment is imposed?
Hi Anonymous,
It is hard to answer your question without further information. What is the Court imposed judgement for?? When you meet with the Trustee in person, bring the judgement with you so the Trustee can review it and give you advice for your particular situation as certain judgements are forgiven and some are not.
Kind regards,
Liz
Hi, I am about 13,000.00 in debt. About 4300.00 is owing to HRSDC for student loans, another 3200.00 is owing to creditors for student loans. I have only been out of school for 5 years. My bank recently told me I am eligible for a preapproved line of credit and a Visa card. My question is, if I use my line of credit or credit card to pay off the creditors and HRSDC, then file for bankruptcy, will the line of credit or visa be forgiven as well as the other debt that I owe? I only work part time now and am just making ends meet.
Hi Anonymous,
Thanks for your question. You should be careful about taking credit to pay your student loans for two reasons. The first is something called a preference. You cannot treat once creditor (in this case Student Loans) better than another creditor. Second - if you take out credit and then file for bankruptcy, this can be viewed as credit abuse. Both of these are reasons why a creditor can oppose your discharge from bankruptcy.
On a positive note, there are changes to the Bankruptcy Act coming which are considering changing the length of time for Student Loans to be forgiven down to 7 years (currently 10 years).
As you are working part time, I would encourage you to find full time work, or a second part time job to pay your debts. You may also want to consider applying for interest relief on your student loans which may help you.
Hope you find this useful.
Merry Christmas and Happy New Year,
Liz
I am 2 years into a 5 year consumer proposal and am still barely getting by. I have a family to support and have been working 65-70 hours per week for the last six weeks and seem to be getting nowhere. Can I claim bankruptcy now in the middle of my proposal? What will happen to my house? Will I lose it. I know that finding a 3 bedroom apartment in my area will not be cheaper than my current monthly mortgage payment.
Good morning,
I am sorry to hear that things are not going smoothly for you with your consumer proposal.
You do have a couple options. The first thing I would look at is why you are struggling. If it is a matter of budgeting, perhaps another counselling session would be most beneficial for you.
You can also talk to your Trustee about amending your proposal. Creditors would have to vote on the amended proposal so this may or may not work depending on your situation.
And finally, yes, you can file for bankruptcy whilst you are working through a proposal if the proposal is simply not going to work.
As for your house, if you have been making your monthly mortgage payments and paying your utilies and property taxes, it is highly unlikely that you will lose your house. You will need to provide the Trustee with a valuation of your home provided by an independent third party (a real estate agent will likely do) and she will determine any equity in your home. If there is any, discuss with the Trustee how this will be paid to your creditors.
Hope this helps. Happy New Year.
Liz
Hi, I have been out of school since 2002. I owe OSAP too much many. I've read that if I file a personal bankruptcy, OSAP would automatically be discharge only if i've been out of school for at least 10 years. However I also hear from others that it's acutally 7 years. Can you confirm please?
The current laws state that student loans greater than 10 years old are forgiven in a bankruptcy or proposal.
The government is currently contemplating changes to the law which may change 10 years to 7 years. At this time, it is not know when or if the change to 7 years will be implemented.
If you are struggling with your Student Loans, you may want to contact them and ask about their programs which can include interest relief.
Hope this helps!
Liz
What happens if a person receives money they weren't expecting after their discharge, but the cheque was dated before the discharge?
Good morning,
The answer is... it depends depending on what the cheque was for. In some cases it will have to be paid to the trustee but in many cases you are entitled to keep the money.
Hope this helps.
Liz
I live in the US now, but have Canadian debts I am thinking of declaring bankruptcy to get rid of. Is this possible?
Hi,
Unfortunately, I am only familiar with the basics of US bankruptcy law so I can't tell you if you filed for bankruptcy in the US, if your Canadian debt would be forgiven. A US bankruptcy lawyer could probably let you know.
Now, if you wanted to file in Canada, you would have to meet some requirements which are essentially in the year prior to filing, you must have been resident in Canada, had assets in Canada or carried on your business in Canada. If you do not meet these requirements, you are not eligible to file.
Hope this helps.
Liz
I have a Paypal debit card (or whatever it's called). It has the Mastercard logo on it. I can only access funds if there is money in my Paypal account. I can transfer money into it, or I can sell something on ebay and I can access my earnings there. Does this kind of card have to be surrendered to the Trustee?
Hi,
Paypal has two products. One is a debit card and one is a Mastercard. You will need to determine which one you have. You are fine to keep debit cards but any credit cards, even if they have a zero balance, must be turned over the Trustee.
Hope this helps.
Liz
My husband has a ltd forestry company that has racked up 40-50,000 in cra debt. i.e hst, source deductions etc. He is considering bankrupting the company and knowing he will be personally liable intends to go personally bankrupt as well. The company has no assets and neither does he. Is this going to be effective? Also I have a retail store that is doing well enough that I don't want to take chances with and it is now our only source of money. It is a sole proprietorship and was registered at Joint Stocks 15 months ago. Shortly there after through joint stocks again we put the store in my husbands name cause he had the better credit and we needed a point of sale machine. The business was never changed as far as the business # goes with the CRA and all along has been having it's remitances and stuff filed by our accountant under my business #. But to complicate things even more, when the name was put in my husband's name @ joint stocks, it automatically generated him a business # for the business as well. Even though we didn't know and have never used it. To make matters even worse my accountant asked the cra who they recognized as owner and they said me but for some reason they have my husbands sin # attached to it instead of mine. The end result is what is going to happen to my business? Is it safe? Is there someone else I should be asking? I don't want to ask cra and tip them off as to my husbands plans cause they may get more active on him while he's sorting things out. Also he is on my business bank account as a joint account. Does his bankruptcy affect my account? It's in an overdraft at the moment anyway. Too many questions I know but you can only imagine our stress load. Please advise as best you can. Thanks
Hi Anonymous,
You have many questions which I can't answer in this forum as I need a lot more information about the situation.
But in general terms, if your husbands name is on your business, then yes, it will have an impact on the business assets and bank accounts(which could be very little or very large depending on further information) as he is listed as an owner of the business.
I would highly encourage you to speak to a trustee directly as they can give you more precise information for your specific situation. Most Trustees offer a free intial consultation to discuss this very kind of information. Your e-mail indicated that one of the debts is for HST so I assume you are in a Maritime province. If you call 1-888-PwC-Debt, you will automatically be directed to the office which is closest to you.
I have Student Line of Credit from bank in Canada worth $100,000 and OSAP funding from 1998 in the amount of $50,000. I also have student loans from US banks. I was a student overseas from 2002-2004 but did not receive any OSAP. Will all my loans be discharged if I become bankrupt? US loans as well? Thanks.
Hi Anonymous,
For your OSAP loans, these are eligible to be discharged in a bankruptcy 10 years after you cease to become a full time student. For your US loans, a Canadian bankruptcy will not discharge these loans as Canadian bankruptcy laws are not binding on US companies.
Hope this helps.
Liz
How do I stop the US banks from harassing me? Does it mean I would have to file a Bankruptcy in US as well at the same time? Thanks.
I filed bankruptcy in March 2007, attended both counseling sessions, faxed monthly expenses regularly to the trustee, and received a letter from trustee stating that they are forwarding my discharge papers and are not objecting to the discharge. But my question is how much time does it takes to get Letter Of Dischage once nine months are over.
smily thomas.
Hi Anonymous,
Your question is regarding US banks whom are harrassing you. If you file for bankruptcy in Canada, most US creditors will stop collections but they are NOT required to as Canadian bankruptcy law is not binding on them. As a result, there is no guarantee that a Canadian bankruptcy will stop the calls. As well, if you ever move back to the US, the odds are probably quite strong that they will continue collections against you.
As I do not practice in the US, I cannot give you any further advise on filing for bankruptcy in the US. You may wish to contact a bankruptcy lawyer across the border.
Regards,
Liz
Hi Amit,
The Trustee should issue your discharge certificate several weeks after the 9 months expires. This is assuming you are receiving an automatic discharge. Ensure that the Trustee has your correct mailing address so it does not get lost in the mail or returned to the Trustee as undeliverable.
If you are receiving a Discharge from the Court, it can take considerably longer. We are currently waiting as long as 3 or 4 months to receive paperwork back from the Courts.
I am deciding on filing for bankruptcy. I have been out of school for 4 years so OSAP loan will not be discharged. But I read some where that I can request the court to discharge me due to hardship. Is it correct? If so, what is hardship as far as the court is concerned?
Hi Anonymous,
For student loans, there is a bit of a discrepancy between the way the law is written and how it is actually practiced.
The law currently states that once your loans are more than 10 years old, you can apply to the court to have your student loans forgiven. The Court will consider this request if you can prove that you acted in good faith in respect to your student loans and that you will continue to experience financial difficulty if you have to keep paying them. I think this might be the "hardship" clause you are referring to.
Even though the law is written as described above, in reality, if you file for bankruptcy and your loans are more than 10 years old, they are forgiven without having to make any application to the Court - they don't seem to be enforcing the law they way it is written.
So, in short, there is no hardship clause if your loans are less than 10 years old. I have seen several people try to apply to court on this basis and none have been successful in getting their student loans forgiven.
On a positive note, the goverment is currently considering changes to the BIA which will change the 10 year limit to 7 years. This change is expected to come into effect some time later this year.
Hope this helps.
Liz
If you claimed bankruptcy and the unsecured bank portion of OSAP was part of that - can they still come back after that debt once the bankrupt is discharged?
I co-signed a bank student line of credit for someone who is filing bankruptcy. Is this loan going to be my responsibility? Will the bank ask me to pay the whole amount at once or will I be able to pay over the years?
Good morning Anonymous,
For any government guaranteed Student Loans, including OSAP, if the loans are less than 10 years old (from the month of your last day of school), then these debts will not be forgiven by a bankruptcy.
Regards,
Liz
If you co-signed any type of loan, student or otherwise, yes, the lender will look to you for payment.
I can't advise if they will ask for the money in one lump sum or over time as each lender has it own policies and procedures. You can negotiate will them though and hopefully you will be able to get set up on a monthly pymt plan.
Hope this helps.
Liz
If I declare bankruptcy can my parents still send me money for rent, phone, internet and other expenses? Or is it going to be taken by the trustee?
Hi Anonymous,
If you file for bankruptcy, your parents can still absolutely send you money for your monthly bills. You will need to report this on your monthly budget but it is unlikely that you will have to pay the Trustee any of the money (other than for your fees.
how long from the time you claim bankrupty and the time you have to move, when you lose your home ???
Good morning Anonymous,
The date you file for bankruptcy does not really impact when you would lose your home. What is more important is when you stopped making your mortgage payments. Every bank is different but they will usually start proceedings to seize and sell the home 2 or 3 months after you made your last mortgage payment. Please don't use this timeframe as a guarantee though as I have seen banks seize homes much quicker and also much more slowly.
Hope this helps.
Liz
1/ We had an appointment with a Trustee, but he cut us loose, saying that we had to bring our tax returns up to date first. We do have several years of returns, and he advised us to just make them out as "zero income" and just file them, because he said it doesn't matter whether we can prove income and expenses or not since we are writing it all off anyway in the bankruptcy. It will take a couple of weeks to get the forms, etc. Meanwhile, I told one of our credit card companies that we are going bankrupt and he wants us to make a small $100 payment just to keep it in their files. (We are now 5 payments behind) He said that if it goes on to collection or to a lawyer, then the credit card company might delay our discharge (by opposing it..?..?..?) and it would make it harder for us in the end. Is that true? Would it be because we put them to the extra trouble and maybe the expense of putting it over to legal collections? Since we are going to be going bankrupt within the month, does it matter if we pay that small amount for that purpose?
2/ Oh, he also said that with the serious position we are in, we will need to apply for a "legal aid" type of Trustee, because he thinks we would not have any surplus, let alone be able to pay the Trustee fees. Can you tell me what is the time element in bringing this all about?
Thank you.
Good morning,
For your taxes, yes, it is very important to have those filed up to date. For the creditor, yes, a creditor can oppose your discharge but to oppose your discharge. Generally a creditor opposition is only seen in the event of SEVERE credit abuse or tax abuse and other serious events. It is highly unlikely that a creditor will oppose your discharge if you fail to make that $100 payment to them as it costs them money to file a court fee to file the opposition. They will also be required to attend in Court. So, long story shory - I can't guarantee it, but an opposition in your case is highly unlikey.
Your second question... I believe that you might be referring to the Bankruptcy Assistance Program. Take a look at my post on November 6, 2007 at 4:22 pm which explains this program.
Hope this helps.
Liz
I have not filed income tax for 2002 but have filed taxes for all subsequent years. Do I have to complete that one as well to file bankruptcy? Even though I owe the government nothing?
Good morning,
Even though you are currently do not owe the government anything for taxes, it is in your best interest to file your return for 2002 and your Trustee will most likely require it. That way, in the event that you do owe CRA, the specific amount you owe will be included in your bankruptcy without any hiccups. It is also in your best interest to file the return as you may be entitled to GST credits for that year.
Hope this helps.
Liz
Is my landlord going to contacted even though I am up to date on my rent payments, in case I decide to file for bankruptcy?
If you are up date on your rent payments, your landlord will not be contacted.
Hope this helps.
Liz
Thank you very much for your previous answer regarding American Private Student Loans. After I get discharged in Canada can the US banks place negative remarks on my credit bureau in Canada?
Unfotuntunately, as I do not work for the credit report companies I cannot give you a definitive answer as each agencies will have there own policies and procedures. You should get in touch with the credit reporting agencies (Equifax, Trans Union and NCB) to ask them about their policies for US creditors.
Regards,
Liz
I am a foster parent and a collection agency is garnishing the total amount that is given for the child over a three month period. They said they can take 100 per cent of the money b/c I am not employed by Children's Aid. The collection agency worker swore an affidavit that said I am employed by CAS which the accountant told her the day before that I was not an employee of CAS but was a foster parent. Three different agencies have told me that the collection agency cannot garnishee foster care payments but I was told today that I will not be receiving the payments for Feb. March and April b/c the collection agency is taking it all.
Is it true that under the current bankruptcy laws there is no set limit but with the new law the limit will be $250,000 and if someone owes more than that they would have to go to court?
Hi Anonymous,
About your foster care payments... you have not actually asked a question so I will give you some general information.
For the garnishment, you would have received a notice of a court hearing. You probably did not attend as this would have been your opportunity to tell the court that you were not an employee but only a foster parent. As you did not attend to defend yourself, they based their decision on the information submitted by the creditor.
If the garnishment was based on false information, you will need to make an application to Court to get the garnishment overturned. A lawyer can help you do this. You may also want to explain the details for the ombudsman for the bank or creditor that is garnishing you. If they are presented with the correct facts, they may withdraw the garnishment voluntarily.
Hope this helps.
Liz
Hi Anonymous,
For bankruptcies, there are various limits for different things but I am not sure which one you are refering to so here is some general information.
Currently to file for bankruptcy, you must owe at least $1,000, be insolvent (have more debt than liabilities) and be unable to pay your debts as they come due. There are no proposed changes to this information.
To currently qualify to file a consumer proposal, you must have less than $75,000 in debt (other than your mortgage) amoungst other things. The proposed change is to increase this amount to $250,000. I believe this is the number you are refering to.
There is also a proposed change that if you owe more than $200,000 in income taxes, and your tax debt is more than 75% of your total debt, you will need to apply to Court to set the terms and conditions of your discharge from bankruptcy. This is probably the Court process you refered to in your question.
Hope this helps.
Liz
Hope
After a layoff about 17 months ago, I am working part-time at an annual salary of approx. $20,000. I currently have debt of approx. $35,000 (credit cards, LOC) that costs me approx. $850/month.
I have $15,000 in savings plus approx. $30,000 in RSPs and $90,000 in a LIRA.
I don't own my own home, but am currently able to live rent free so I have very few expenses other than my debt. I own a car valued at approx. $12,000.
Would I be eligible for a consolidation loan or do I need to consider bankruptcy? I'm hopeful for an interim solution to tide me over until the time I obtain a new fulltime job (which must happen!) with a desired salary of $50,000.
Dear Anonymous:
Thanks for your question. Clearly it's difficult when your income is suddenly reduced. The good news is that, based on what you have indicated, you're not insolvent - your assets exceed your debts - which means you don't need, nor qualify to file bankruptcy.
We'll leave the LIRA out of the discussion since typically such investments are not accessible unless you are nearing retirement age.
It may be difficult to find a lender willing to consolidate your debts at a lower interest rate because of your reduced income - but it's definitely worth a try. Check with your own bank and others. They will look at your credit rating and weigh the various factors. If you do get a full time job at the level you want, then this is definitely a good option. Going forward, just try to avoid accumulating debt on the credit cards you have paid off through the consolidation loan.
It sounds like most of your debt is high interest. While most people resist the idea of using savings investments or RSPs to pay off debt, the reality is that if the debt is high interest, it is rare that the investments are accruing in value faster than the interest on the debt. To look at it another way, what would you think if your savings investments or RSPs were losing $850 in value every month? You should definitely consider reducing or eliminating your debt by using your savings and/or liquidating your RSPs. Yes, there will be tax owing on the RSPs if you collapse them. However, the financial institution will deduct tax at the time of withdrawal, and your lower income right now may give you a tax bracket advantage. If you were debt free but able to save $850 per month to put into an RSP, you would be able to replace the investment very quickly.
Hope this helps,
Liz
I was transferred from one city in Ontario to another and am unable to sell my mortgaged home due to the poor economy in that city; so I am now stuck to pay rent where I am working now PLUS my mortgage payment in my other home which is vacant; PLEASE ADVISE. Thank you.
Good morning Anonymous,
Re: not being able to sell your vacant home. Perhaps it is Monday morning and I have not had enough caffiene yet, but you have posted a statement about your personal situation and I am not quite sure what your question is. What are you looking for advice on? Selling your real estate? Foreclosure? Paying your bills or balancing your budget? Please let me know so I can better respond. In the interim, I will go get another cup of coffee to get this very chilly morning started :-)
Cheers,
Liz
I am currently in my second bankruptcy.. should be discharged march 2008.. i got a letter that it is being opposed by my trustee for not attending a second counselling session. I have now made the appointment but it will be 245 days from the date not 210..
also missed sending in 3 month of forms but they have em now..went back to school, possible divorce just been hectic for about 6 months.
my question is..will my bankruptcy not go through now even though the have the money and the forms wil this second counselling session stop it. an advice will help. thanks
Good morning,
The fact that you have now complied with your outstanding duties should make your discharge application go smoother but as this is your second bankruptcy, you do not qualify for an automatic discharge.
Depending on where you live, you will likely have to appear in Court where a Registrar will review your situation, ask you details about your first and second bankruptcy and then determine your discharge status. The Trustee will send you notice of when this hearing is.
Hope this helps,
Liz
thank you.. it just was worriesome. when i applied the trustee said it was automatic after 9 month which is march 23. then there is a notice he plans to object also cause its my second..I live in Ontario
I appreciated your quick response thank you
I have been thinking about declaring bankruptcy...I havent made any payments on my 3 credits cards or line of credit for over 2 months now. Recently I was dismissed at my job, so I currently dont have an income coming in, how does this work with being 'judgement proof'? I went to a trustee almost 1 year ago, but never filed, b/c i was afraid, What should i do about not being employed at the present moment??
Since Iam not employed and may go bankupt what will I still be bondable??
tkm
Hi TKM,
As you have no income, you may be judgement proof (but not always - there are some technicalities). This means that if someone sues your for the payment of a debt, the Court will most likely not issue a judgement against you. You will have to attend at Court and explain your current situation. Being Judgement Proof will not stop the creditors from harrassing you and/or trying to sue you. Many people, even though they are Judgement Proof still elect to file for bankruptcy for this reason.
As for what you should do about not being employed at the moment... I am not a career counsellor but I would encourage you to ensure your resume is up to date, read the want ad's in the paper every day, check out job websites and start pounding the pavement. Make finding a job your full time job right now. Get out of bed every day and start work (finding a job) every day by 9 am.
As for being bondable, each bond agency and employer has their own internal requirements. As a result, I cannot give you 100% assurance that you will be bondable. What I can tell you though is that in 13 years of doing this, I have never had a bankrupt tell me that they were refused for bonding purposes.
Hope this helps,
Liz
I have student loan debt along with other debts. My student loan debt is 4 years old but the current law requires it to be at least 10 years before it can be discharged. I read some where that I can file for bankruptcy before the new law comes into effect and still use the new laws 5 years rule to discharge the student loan through the courts. I am right? Or do I have to wait until the new law comes into force?
Good morning,
You have very good timing! An article regarding the changes to Student Loans crossed my desk this very morning. The article states:
"... once the legislation comes into effect, undischarged bankrupts who have been out of school for more than 7 years would be eligible for an immediate discharge, while those who were previously discharged from bankruptcy but had a surviving student loan debt and have been out of school for more than 5 years would immediately have the right to apply to the Courts for a discharge on grounds of continuing financial hardship".
Once the law comes into effect, if your loans are between 5 and 7 years old, you will have to apply to Court to have your debts forgiven. You will have to demonstrate financial hardship to the Court in order for them to consider this and it is not guaranteed.
If your student loans are more than 7 years old once the law comes into effect, the discharge is automatic and no court application is required.
Hope this helps.
Liz
I am considering filing for bankruptcy. I am a mother, would i lose my baby bonus/child benefits?
Regarding Student loans, does it mean that if I file for bankruptcy tomorrow (even though it has been 4 years since I finished school) I can go to court and request a judge to discharge the loan next year once the new law comes into effect? I don't have to wait for the new law to take effect? I am very concerned because I don't want to file for bankruptcy and be told since I filed under the old law the new law will not apply to me, I have to wait for 10 years.
Good morning,
You will not lose your baby bonus to the Trustee although you will have to report this income on your monthly budget.
Hope this helps.
Liz
For your student loans, the changes do not come into effect until "the legislation comes into force".
They are still working out the details of the changes so personally, I would wait until it was finalized to make sure that everything is in place.
If a person declares personal bankruptcy and is the owner of a corporation, does the corporation get affected? Can the company remain separate from the personal bankruptcy? The debts involved are all personal and have no claim on the corporation.
Linda S
Good morning,
If you own a corporation, but file for personal bankruptcy, the shares which you own in the corporation will be listed as an asset in your personal bankruptcy. Talk to a Trustee in person about the impact this might have on you and the company as is can range from no impact to a possible large impact.
As well, if you file for bankruptcy you cannot be a director or officer of a limited company so you will need to resign any of those positions.
Those are the basics but talk to the Trustee about this as they will be able to give you more specific advise for your particular situation.
Hope this helps.
Liz
Hi Elizabeth...
I am a small business owner and i cannot make ends meet. I have a business loan and line of credit but i think they are personal as its a small business. My parents co-signed and i don't know the implications for them or myself if I file for bankruptcy. I have a good job (the business is an evenings and weekends thing), i have a son and and new car and i'm terrified...can you suggest anything?
Hi Anonymous,
Thanks for your posting. It is so hard to give you advise over the internet as there are many possible answers depending on your particular situation.
A bankruptcy might be appropriate but it is also the last possible option. You may also qualify to file a proposal or may simply need some help with your budgeting.
Normally what we do is have a consultation with you at our office. This way we can give you precise and accurate information tailored to your siuation. Usually this will also help alleviate your fears as there are many myths out there about bankruptcy.
At the consult, we can also review the situation with your parents in more detail and give you all the info you need. Give us a call at 519-640-7921 and we can book an app't for you... and there is no obligaction! If we don't feel that bankruptcy is right for you, we will tell you that...even if it means you don't use our services.
I look forward to talking to you.
Liz
Hi My mom recently passed away and she had credit cards that were strictly in her name and not my fathers name, we live in Saskatchewan, is he responsible for her credit card debt? I have sent the credit card companies a copy of her death certificate, I have been told by many that he is not responsible for her credit card debt if he is not a cosigner on the card and that they can not collect any money from him for her debt, is this correct?
Good morning,
My condolences for your recent loss. It is never easy to lose a cherised loved one.
For your Dad, he is NOT responsible for any debts which he did not co-sign.
Is he the executor of your mom's estate? Whomever the executor is, they are responsible for winding up your mom's affairs, including filing her last tax return, selling her assets and paying her debts from any proceeds received from the assets. Any bills must be paid before the beneficiares named in her will are paid. They may be calling your Dad thinking he is the executor... a long shot, but a possibility none the less.
Hope this helps.
Liz
iam not sure if or when i will be claiming bankruptcy, but my question has to do with tax returns.If I recieved my 2007 tax year refund for the year and after decide to claim bankruptcy what is expected of my return?? at this point will I be expected to give back the money, even if its a month after the fact?? Iam asking b/c the money may be gone at that point for bill payments etc...
Hi Tiffany,
If you receive your tax refund before you file for bankruptcy, it is yours to keep.
Regards,
Liz
Hi. I'm on the Board of Directors of a not-for-profit daycare. Very small operation, we're all well-meaning parent volunteers & aren't really very business-savvy. In retrospect, we didn't exercise due diligence.
We're in quite a mess: not meeting payroll, we owe back taxes like crazy, we're behind in rent and owe numerous bills.
(How did it happen? Short story: incompetent supervisor has now been replaced, but too late I fear.)
Question 1: What's involved in declaring bankruptcy?
2: How do we make it as painless as possible for all concerned, especially workers owed back pay?
3: What's the legal fallout for us Directors collectively and as individuals?
Thanks very much for any information you can provide.
I filed for bankcrutcy in 2005, I secured by leased vechilce, however through the claim I wasn;t able to make ends meet on the advise of my trustee she said the best thing to do was not to make payments and get it repoed, so I did now I got a bill of 11000.00 with interest aquiring, what would your solution be. I am finally out of the whole not, only to be put back in, i sold my house to pay off small loans and a huge student loan. can you please give me some advise, I tried to talk to my trustee but she seems to think shes already done her part and she wont talk to me. I have also called a lawyer for some advise but they all seem to have something different to say.
Hi Dustan,
Thank you for your questions and volunteering your time to help with the daycare. Unfortunately, most of your questions cannot be answered without me knowing alot more information. There are several possible answers for each of your questions.
Your best bet is to sit down with a Trustee in person so they can get some of the specifics and give your advice tailored for your particular situation. All Trustee's will give you a free consultation so you can gather information and make an informed choice.
Hope this helps.
Liz
Hi Anonymous,
As I indicated in my last post to Dustan, it is often hard for me to answer questions in this forum as I do not have enough information. Your situation is the same.
The first question I would ask is where do you live as the laws change from province to province. If you live in BC, the creditor cannot seize the vehicle and then come after you for the shortfall. Once they have seized the vehicle, that is the end of it. If you live in Ontario, the law is different and a creditor is allowed to both repo the car and come after you for the shortfall.
The next questions would be... Did you make a car payment after you filed for bankruptcy or after you were discharged from bankruptcy?? Did they repo the car before or after you were discharged from bankruptcy?? All of these answers will impact whether or not the shortfall can be included in your bankruptcy.
Have you advised the creditor that you filed for bankruptcy? Perhaps they do not know about your bankruptcy and that is why they are coming after you for payment. Get their fax number and ask the Trustee to fax them a copy of your bankruptcy documentation. This may help.
While I can't answer your question directly as I do not have all the information, I hope the above does help you out.
Regards,
Liz
I have been in serious debt for aproximately 3 years, and I have gotten a second job to try to pay the debt down, but I am struggling more now than before. I make approx $2800/m after tax. My monthly debt payments are approx 2400 including insurance, rent, utilities, and credit card/ loan debt. That does not include food, gas, etc.
I am unable to get a consolidation loan as my debt servicing is too high, and I'm running out of ideas on how to pay things down. Of the $70,000 I owe, 47,000 is on a secured vehicle loan in which they consolidated some of my debt. The vehicle is worth max $20k.
I am only 27, and I am unable to purchase a home/condo as I owe too much, and I have been considering bankruptcy for over a year now. I have a few questions.
1) Is it worthwhile to file bankruptcy?
2) If I was to file bankruptcy, would my employer be notified?
3) What would happen with my vehicle- I live in Ontario
4) This might sound silly, but do I have to restrict my cable and cell phone to the absolute basics for the period of the bankruptcy?
Thank you in advance for your assistance.
Hi Anonymous,
Thanks for your questions... I will answer them in the same order you have posed them.
1) Is it worthwhile to file for bankruptcy? I can't refer bankruptcy to anyone without knowing many more details about your situation. You may also qualify to file a proposal based on your level income. Filing a bankruptcy or proposal is worthwhile is you are struggling under your debt and there is no other solutions. We would be able to tell you about other solutions once we have all of your financial information.
2) Your employer would only be notified if a) you owe them money b) your wages were being garnished and the Trustee was stopping that or c) you don't give the Trustee the information required to complete your income tax returns. Otherwise, your employer will not be notified.
3) Your car is worth $20k and you have to make $47k in payment. Why would you want to pay that much for a car that is not worth that much?? If you decide to file a bankruptcy or proposal, we would probably recommend that you get a gently loved car which costs much less and the pymts fit into your budget. Any shortfall from the first car would be included in your bankruptcy or proposal.
4) You don't have to restrict your cable and cell phone to the basics. The important thing is that you live within your budget. If those expenses fit, then they are absolutely fine.
Hope this helps,
Liz
my husband past away a year and a half ago.he had a company but since i had to register bankruptcy.am told that his creditors can come after my personal money.he was the sole owner of the company and i just worked for him as an employee.can they take my money from my bank and even take my home away from me?asking cause i have been told that they can due to the fact his wife.please reply soon
Good afternoon,
My condolences for your loss. I assume you were not a director or officer of your husband's company? If you were not, the good news is that if you did not co-sign any of the company or your husbands debts, they cannot come after you personally for payment. If you signed any paperwork, you have may accepted liability without realizing. I would ask the creditor to provide proof that your signed something saying you were liable for the debts. As well, if the Company closed before your date of bankruptcy, any of these debts would be forgiven by your bankruptcy.
If you were indeed a Director or Officer, you are responsible for certain debts of the Company. If this is the case, I would encourage you to speak with your Trustee about this as these debts should have been included in your bankruptcy.
Hope this helps,
Liz
P.S. - Please take a look at my post on February 28 regarding a similar matter.
Does the length of bankruptcy depend on the amount I owe ($250,000)? The usual time it takes is 9 months but I was told that creditors can object sometimes. Is that true? If so how long will it take to come out of bankruptcy? Thanks.
Good afternoon,
The average bankruptcy is 9 months long. It can go longer if you do not comply with your duties, if you have surplus income, if there are conduct issues such as credit abuse, addictions or gambling, if a creditor opposed your discharge and so forth.
I can't give you an exact timeframe as all of these matters will impact it. Talk to your Trustee about this as they can probably give you a better idea based on your personal facts.
Hope this helps.
Liz
Thank for the quick response. Can a creditor oppose my bankruptcy even though I did not commit any credit fraud? What happens if they oppose? How long can the discharge take? Thanks.
Hi Anonymous,
A creditor can oppose your discharge for numerous different reasons that are listed in s.173 of the Bankruptcy and Insolvency Act. The reasons are simply too long to list here. Is there something in particular you are worried about??
Creditor oppositions are rare so you are likely worrying about something that will not happen. If they do oppose, a court date will be set. You and the creditor will attend to discuss why the creditor has opposed your discharge. The Court will make a decision once they have heard from both you and the creditor.
How long will it take?? That really depends on each case and why the creditor is opposing so I can't give you a precise answer without knowing more info.
Regards,
Liz
My husband and I are in a credit counselling program but the amount that we pay is quite large. The counsellor suggested that bankruptcy could be an option considering the amount. I have a few questions. Question 1) My husband has a student loan from more than 10 years ago. He graduated in 1996. Can the student loan be exempt? Question 2) My husband is currently bondable in his job, when crossing the border or for his work would his work or the border see the bankruptcy? He is applying for NEXUS and does not want this to effect his job. Question 3) We are both working and need our cars, would we lose our vehicles? We have not miss a payment and have not had a late payment. Question 4) We have a loan with Citi and they have a lien on one of the cars? If we go bankrupt what will happen? Question 5) It says that bankruptcy is 9 months. How long will it show on your record? I thought it was for 7 years. We have never gone bankrupt. Thank you for your time, patience. If you answer these questions that would be greatly appreciated. Thanks, Desperately need your help.
Good morning Anonymous,
You indicate that you are paying "large amounts" under a credit counselling counselling program. It may be that filing a proposal is a better option for you than bankruptcy and this can be discussed when you meet with the Trustee for your first consultation.
1) Any student loans greater than 10 years from the last month of school are forgiven in a bankruptcy or proposal.
2) His employer would not be advised of the bankruptcy or proposal by us unless they were a creditor or we had to contact them to get a wage garnishment stopped. I can't advise what the border would see as I am not privy to the information contained in their computer system but I would highly doubt it would affect his ability to get over the border.
3) If you have not missed a car payment, the odds of losing your vehicles are very remote.
4) You will need to continue to pay Citi if you want to keep the car. Talk to a Trustee in person about this though as there are some options.
5)The average bankruptcy is nine months long but they can go on longer. The record of your bankruptcy?? I assume you mean your credit report?? A first time bankruptcy stays on your credit report for 6 years from the time you are discharged.
Hope this helps.
Liz
I am considering bankruptcy due to large debts including OSAP. My wife is planning to go to school and apply for OSAP. Will my bankruptcy have any impact on her ability to get OSAP? Can she be denied OSAP because of my bankruptcy?
Good morning,
I highly doubt that your bankruptcy will impact your wife's ability to get OSAP.
You should contact OSAP and ask them for a copy of the policies and procedures to be 100% certain.
Liz
I am currently on Employment insurance benefits and my credit cards have 30,000 debt.I have 3 short questions.1)Can i file bankruptcy while on EI 2) I own a $1700 computer and a Guitar ($1300) and Guitar amplifier($2000).These are my only assets are they protected under personal possessions.3)I was taken to court over a loan and judge awarded plaintiff $4200 in small claims court.Will then $4200 judgement be included in Backruptcy.Thanks in advance.
Good morning,
Thank you for your questions...
1) Yes, you can file for bankruptcy while on EI.
2) It depends on which province you live in as each province has it own exemptions. The likely answer is yes, you will be able to keep them but double check with a trustee in your province. Also look into whether any creditors have security on these assets as this will affect your assets as well.
3)Depends on what the judgement was for. If it was a run of the mill debt such as a loan or credit card, it will be covered by your bankruptcy. There are certain judgements which are not covered by bankruptcy so bring a copy of the judgement with to your initial consultation for the trustee to review.
Hope this helps.
Liz
I had a lien on my car with Citi financial and HSBC but the car is no longer of any value and I got rid of it. Can I still file for bankruptcy for this loan? The loan is more than 10 years old. How can I find out if there is a lien still on the vehicle? Are there rules to liens and filing for bankruptcy? If I can't put those loans under bankruptcy can I have them under Credit Counselling?
My husband is in the process of filing for bankruptcy but also got a job in the US. Can he go to the US if he is going to go bankrupt? What if some of his loans have both of our names on them? Can he assume the loans and go bankrupt? Will it affect me?
Good news... you can absolutely get rid of the debt re your car lien by filing for bankruptcy.
Don't bother spending the money to do a lien search as it will be a waste if you do file for bankruptcy.
Hope this helps,
Liz
Hi,
The good news...your husband can work in the US while he is bankrupt in Canada.
The not so good news... if your name is on the accounts, they will look to for payment. You can try to get the credit card company to remove your name and have your husband assume the debt but it is unlikely that they will do this unless the account is paid in full.
Hope this helps.
Liz
I have not filed my income tax for 7 years. Can you file your taxes owing to the government under bankruptcy?
Thanks for the response. So if you have a loan with Citi or HSBC and the car you owned has a lien against it you can file for bankruptcy and you will not have to own them after or tell them that the car is no longer in your posession? Sorry just want to make sure that is what you mean?
When filing for bankruptcy can a creditor still take you to court? What are my rights?
My partner and I make about $125,000.00 a year before taxes. What would the monthly charge be from a trustee for the 9 months? Can you get a secured credit card during that time to rebuild your credit? Can you assume any credit during those six months? Does a trustee set up a budget? Can they tell you can't rent or own a vehicle anymore when you need to live and get to work?
What's the difference from filing a proposal and filing for bankruptcy? What if you are with Credit counselling and you owe $75,000.00 and your payments are $1300.00 a month. This is way too expensive and too much to handle! HELP ME PLEASE?
I'm in the process of going bankrupt. However my dad wants to buy me a house because he wants me to get me back on my feet. I still need a place to live and he would not charge me interest. Would the house get taken away?
Can a creditor get discharged from your credit report if you have not paid the loan in 7 years? I do not see it there and wondered, did they write it off as a loss?
Wow this is a great site. Thanks for helping all these people out. You are too kind. Can you file for bankruptcy outside of your town. I know so many people and do not want to file for bankruptcy in my own home town. Etremely embarassed!!!!
I am now bankrupt and my trustee said I could keep my vehicle for I still owe $16,000.00 on it. However the interest is still very high on it. It is 13.99%. Can the creditor for my vehicle lower the interest? If I told them that I recently went bankrupt, would that help?
Wow... quite a flurry of questions yesterday around 4pm. I will answer them in time order...
3:46 pm - You can include your taxes in a bankruptcy. You will need to get your taxes filed to ensure that everything is included.
3:50 pm - If you file for bankruptcy, a shortfall from a secured laon can be included. This would be the case with your car. They would need to be advised that the car was no longer in your possession and details of the sale will need to be provided as they still technically own the car.
3:54 pm - when you file for bankruptcy, there is a Stay of Proceedings which protects from your creditors. Creditors cannot take you to Court unless they receive specific permission from the Court to lift this Stay of Proceedings. This is quite rare and only usually done in extreme cases. An example where I have seen the Stay lifted is a fellow who filed for bankruptcy not telling the Trustee that he had critically injured someone while driving drunk. He was trying to avoid paying the victim by filing for bankruptcy. The Court lifted the Stay so the family could sue him for damages.
3:59 pm - I cannot advise of the monthly surplus income payment without knowing your net income, the number of people in your family and certain expenses. This is probably best calculated by the Trustee at your initial consult when they have all of the information. You can obtain credit while in bankruptcy providing you advise the credit granter that you are currently bankrupt. You set up your budget but the trustee can provide advise on how to make it work better for you. The Trustee won't tell you what you can spend your money on (such as a car) but if they think you are living beyond you means, they will let you know so you can reestablish yourself after bankruptcy on much more solid footing.
4:03 pm
There are quite a few difference between filing a bankruptcy and a proposal. I can't go into all of the details here but here are the basics...
A proposal is a process where you offer to pay back a reduced amount to your creditors. Most people end up paying back app. 25% of the debt but each case is different. There is no futher interest charged. Creditors have the right to refuse, accept or counter the offer submitted to settle the debt. Once an amount is negotiated, most people make monthly payments to the Trustee to pay off the negotiated amount. You get to keep your assets in the significant majority of cases.
A bankruptcy is forced upon your creditors. They can't elect (like a proposal) to not accept it. Your non-exempt assets are turned over the Trustee whom will sell them for the benefit of creditors. You also need to make a monthly pymt to the Trustee based on your income. The average bankruptcy lasts for 9 months.
This is a real general summary... your Trustee can provide you more details. Based on the info you have provided, a consumer proposal might be a great option for you to help with your debt.
In a bankruptcy, your credit rating will have a 9 on it for 6 years from the time your are finished. With a proposal, your credit rating will have a 7 on it for 3 years from the time you finish.
Hope this helps.
Liz
4:12
Sorry... I can't advise if your creditor has writing off the debt as a loss. You might want to ask the credit bureau for more details. There are collection laws in Canada but as I am not a lawyer, I cannot give you any advice on these.
4:15 - when you file for bankruptcy, your bankruptcy is confidential. The only people who are going to know are your creditors and the government. Someone can also find out if they do a search on your credit report. Please do not be embarassed! We are here to help you but if you simply don't want to file in your town, find a Trustee in the closest town and file there. Please remember though that this will mean additional driving for you as you will need to attend several meetings at this office.
Hope this helps.
Liz
4:24 - it certainly never hurts to call a creditor to see if they will lower your interest rate. Whether or not telling them you are bankrupt will be any help... I can't advise as each creditor is different and has their own personality and office policies and procedures.
If you want to get out of the loan, talk to your Trustee as there may be options depending on how far into your bankruptcy you are, what province you live in and if you have made any car payments after filing your bankruptcy.
Hope this helps.
Liz
I see that you had a lot of comments but I did not see a response to my question. I'll cut and paste the comment again.
I'm in the process of going bankrupt. However my dad wants to buy me a house because he wants me to get me back on my feet. I still need a place to live and he would not charge me interest. Would the house get taken away?
March 19, 2008 4:09 PM
The new bankruptcy law received Royal Assent on December 14, 2007 but the new law did not come into force yet. Who is responsible for this? How long did it take the last time the bankruptcy law was changed? Can people waiting for this new law to come into force contact some one in the Government to pressure them into making this happen soon? Why make people suffer so long?
I am filling for chapter 7, my income is low and my property has no real value, so my question is will my household items that i used for collateral on 2 loans be taken or will thay be exempt?
If you are filing for Chapter 7, you live in the US. As this is a Canadian blog and our laws are quite different, I can't answer your question... you might want to ask your US bankruptcy attorney.
Regards,
Liz
Hi Anonymous,
The odds of losing a house are rare (and vary from province to province) but there is still a risk. I would suggest that your Dad wait until you are finished your bankruptcy to buy you a house.
Hope this helps.
Liz
I have recently been discharged from bankruptcy and now the CRA is calling and sending letters saying that I owe them $5200 from the year I filed for bankruptcy. Why wasn't this covered by my bankruptcy. Do I still have to pay them?
I live in Ontario. I am planning to move to Toronto in a few months. Does the bankruptcy law change if I file for bankruptcy in London or in Toronto?
Hi,
For your CRA debt... what is the debt for? I would need to know that before I could answer your question fully but here are some general details that only relate to income tax and NOT GST, child tax credits etc.
When you file for bankruptcy, your income tax return is split into two returns. One is PRE bankruptcy (January 1 to the day before your bankruptcy) and one is POST (the date of bankruptcy to Dec 31). If you owe in the PRE, it is covered by your bankruptcy. If you owe on your POST, it is not covered by your bankruptcy as this is an income tax liability which you incurred after your date of bankruptcy.
Hope this helps.
Liz
Bankruptcy laws are Federal laws so they are the same for everyone no matter where you live in Canada.
There are provincial laws (such as Personal Property Security Act, Employment Standards Act, Landlord and Tenant Act to name a few) though that might impact you and a bankruptcy. If you move within the same province, there is no change you need to worry about.
Liz
Sorry, I should have specified the CRA part. i had a business and hurt my back. I had to file for bankruptcy as I could not work and my insurance did not cover my back. i filed in February of 2003. The bankruptcy trustee filed my taxes for the 2002 year, but it was filed in the spring of 2003. The amount owing was from the 2002 year. It was income tax based on my earnings for that year. Now the CRA is saying that I owe them that money ($5200) for the 2002 year. Should this have not been included in my bankruptcy. If not, will the CRA take payments?
Good morning,
If you filed in 2003, your 2002 income taxes are included in your bankruptcy. Get in touch with the Trustee and ask them to get in touch with CRA.
If the "return" filed by the Trustee was your source deduction return or filing, this is a different matter and you may be held responsible even after bankruptcy for source deductions which you did not remit to CRA.
Hope this helps.
Liz
Hi my husband and I filed bankruptcy in 2006 I was discharged but he is not due to it being his second one. My question is that we are entitled this year to our income tax refund but my husband had an overpayment from ei and still owes them will they be able to take it away even though he is still in bankruptcy for another month? Our trustee told us we are entitled to get our refund but I dont know if ei can take it.
thanks so much for your help
Hi,
It is hard to give an answer without knowing more details. If your Trustee has already advised you that you are entitled to the refund, I would take his advice at face value as he is aware of the particulars of your file.
Hope this helps,
Liz
annoymous
if someone has filed for bankrupcy on 26000.00 owed and the creditors wanted 22000.00, sold the car for 1700.00. he gave them 1020.00. then he came into money and told the trustee before it was discharged but the trustee said to hang on to the money. then they called 6 months later and asked for the money. he gave them $20060.00( it seams that they waited until all the creditors had or had not responded to them until they asked for the money) plus they took the car and sold it. and now they are asking for $7664.
all attempts have failed to be provided with a written summary of details of creditors and where is all the money has gone and what is left to be paid.
is this normal actions of a trustee.
Good morning,
It is virtually impossible to answer your questions with more information. If you are looking for a copy of the Final Statement of Receipts and Disbursements (which is an accounting of all funds received),or a claim register (a listing of all creditors including those whom have proven their claim) ask the Trustee for it. If the Trustee will not give it to you, or you have a concern about the conduct of the Trustee I would recommend that you get in touch with your local office of the Superintendent of Bankruptcy.
Hope this helps.
Liz
I filed Bankruptcy in Dec. '07 and then in January I found out that I will be getting a buy out at my job because I dont have the seniority to stay. My buyout will be approx. 30-35K before taxes and I will be receiving it in May of this year. Since this is basically a severance package, I am not able to apply for EI benefits for 30-35 weeks because the buyout is covering that time frame. I am wondering if the trustee can take all or some of that money from me? If I dont find other employment right away then this is my only means of income. Thanks for your help.
Related to the April 23, 2007 post about Directors' Liability, do you happen to know if this would have been the same outcome in 2003?
My corporation ceased operation in 03 and my personal Consumer Proposal listed its GST obligation (approx $5000)among the other business debts that had been personally guaranteed. The proposal was accepted and fulfilled. CRA continued to pursue me for a while with letters and phone calls, but all seemingly stopped by the start of 2004.
Every once and a while I get worried that the account is still "open" somewhere and once the interest/penalties get high enough CRA will find it worthwhile to pursue me.
(The corporation has not operated since the Consumer Proposal, however the corporation was not legally dissolved. Unsure if this matters.)
Thanks for providing such a helpful service here!!
from march 27, 2008 4:00 pm
thankyou for the information on the "Superintendent of Bankruptucy" he has contacted them and has recieved a very positive response.
He couldn't afford a lawyer and didn't know who could help him.
I had just chanced upon your website and am thankful that you responded so quickly, he was at his wits end and very distraught.
Today he is very happy and relieved.
It makes me wonder if there are other people in this situation and if they too know they have someone to turn to.
thank you so much.
It has come to my attention that an acquaintance of mine has been bragging that he "ripped everybody off" by hiding assets from his creditors and trustee when he filed for persoanl bankruptcy 3 years ago. Worse yet, he left his ex-wife (his co-signor at the time for his credit cards) all of his debts. This is fraudulent and disgusting behaviour. He also assisted by his new girlfriend in doing this. Can anything be done ? Who would investigate ? What can be done ?
Hi everyone,
Sorry for the slow response. I have been at home for the last week fighting off a nasty flu bug. I am all better now and will work on replying to your questions.
Cheers,
Liz
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