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Frequently asked questions

Sometimes you just have to ask the right question and everything becomes clear.

Do you have any financial problems? Are you experiencing one or more of these situations?

  • You are not able to reduce your debts, on the contrary, you borrow to pay your old debts;
  • You can't pay all your current debts at the end of the month;
  • You can't pay your rent
  • You are unable to pay your Hydro-Québec, Bell or Videotron account;
  • You use your credit card to pay the minimum payment on your other credit card.

If you answered yes to one or more of these questions, we can help you.

To file for bankruptcy, you must be a Canadian citizen. Have a Canadian address and have more than $1,000 in debt. You must be insolvent, which means that you are unable to pay your debts as they become due.

The law allows you to keep up to $7,000 of current market value of your personal property. In fact, in most cases, your trustee will evaluate your belongings and agree with you that you can keep all your furniture from your main residence as well as your clothing necessary for everyday life.

Your trustee will help you identify which assets will need to be turned in. In general, be aware that the following assets will be turned over to the trustee to be used to pay off your debts:

  • Cash value of life insurance;
  • Furnishings in excess of the basic exemption value ($6,000);
  • Tax refunds from prior years and the year of bankruptcy;
  • Automobiles and recreational vehicles with a market value greater than what is owed to the secured party. However, you may agree to keep these assets by making payment arrangements with the trustee;
  • The principal residence, the cottage, a piece of land whose market value is higher than the amount owed to the secured creditor (equity). If the residence is partially owned by the non-bankrupt spouse, the non-bankrupt spouse may purchase the bankrupt's share at the market value assigned to the bankrupt;
  • RRSP contributions made in the last 12 months prior to bankruptcy;
  • The portion of the RESP representing your Contributions;
  • TFSAs, any non-RRSP investment;

If your car is leased, you can keep it as long as you make the lease payments;

If you financed your car purchase with a loan, the trustee will make sure that your payments are up to date and you will be able to keep your car as long as you continue to make the payments stipulated in the loan contract;

If there is no debt on your vehicle and a significant value can be derived from the sale of the vehicle, the trustee can either sell it or ask you to pay compensation in bankruptcy for the benefit of the creditors.

If you are no longer able to pay your mortgage, your bank can take it back and sell it;

Several other contexts may exist and we advise you to consult us to discuss them.

They are not affected by your bankruptcy unless the debts are joint. Then your spouse will become responsible for all joint debts.

There are three types of creditors:

Secured creditors

  • Mortgagee (e.g. mortgage on a house)
  • Installment sales (e.g., car financing)
    Reservation of property rights
  • Rental and buy-back

Ordinary creditors

  • Any other creditor who does not have a security interest to publish against any of your assets.
  • Personal loan
  • Line of credit
  • Credit card
  • Taxes

Creditors who retain recourse despite a bankruptcy or consumer proposal:

  • Secured creditor, if you keep the property
  • Alimony
  • Ticket
  • Overpayment of employment insurance or income security benefits
  • Criminal judgment
  • Student loan if you have completed your studies less than 7 years prior to submitting your application.

In the context of a bankruptcy or consumer proposal, personal taxes are a dischargeable debt. The same is true if you are an individual who has a GST and/or QST debt. This debt would also be a dischargeable debt.

No. As a bankrupt you cannot apply for or incur credit.

A bankruptcy results in an R9 rating on your credit report and this rating remains for the duration of the bankruptcy and 6 years after your discharge. Your credit report is already affected if you have been struggling to pay off your debts for some time.

Do you have more questions?

Nos appels et rencontres sont 100% confidentiels et une consultation n'affecte pas votre cote de crédit.