Bankruptcy

A 4 Pillars consultant can explain the implications of bankruptcy and review all your other options. When required, we can support you through the bankruptcy process and work with the Licensed Insolvency Trustee required to file and administer the bankruptcy. We help you through it and show you how to avoid it from ever happening again.

Occasionally bankruptcy is the only option available.

A Bankruptcy is considered a debt restructuring option for consumers who have “no other options” and when their debts have become overwhelming. In Canada, over 80,000 Canadians filed for bankruptcy last year. The Bankruptcy process is the most severe form of restructuring and is filed under the Bankruptcy and Insolvency Act, whereby a Licensed Insolvency Trustee takes control of your non-exempt assets before you are discharged from your bankruptcy.

A Bankruptcy (depending on your surplus income) for a first time Bankrupt is up to 21 months and up to 36 months for the 2nd time bankrupt.

Many things can affect the outcome of your bankruptcy, but here are some highlights for you to consider:

Bankruptcy Highlights

• You are required to fill out monthly income and expense reports during your Bankruptcy
• You are required to attend two counseling sessions
• You cannot be a Director of an incorporated company
• You may lose income tax returns during your bankruptcy
• You will not receive any GST cheques during your Bankruptcy
• You cannot obtain any credit as an undischarged Bankrupt
• The Bankruptcy remains on your credit report for 6-7 years after your discharge

Bankruptcy Benefits

• Most wage garnishments cease immediately
• Once bankruptcy is file Interest stops accumulating
• Collection agencies are no longer permitted to contact you

Through this process, a debtor must give “Full Disclosure” of all their assets, liabilities, income & expenses as well as business holdings as part of the process.

• You must be insolvent to file a Bankruptcy (debts are more than assets)
• You cannot pick and choose the debts you include
• You cannot eliminate support or alimony allegations
• You cannot eliminate student loans under seven years
• You cannot include secured debts such as mortgage and car loans
• You are allowed to keep certain assets based on Provincial legislation