Daughter’s Vehicle
I understand that in the Province of Ontario, should someone go bankrupt, they are allowed to retain a vehicle worth $5,650. In 2001, I purchased a vehicle from the wreckers for my daughter for $1400 and made it roadworthy. She had started college and worked part-time. A year later, she had paid me cash for the vehicle but I retained the car in my name because the insurance rates were much cheaper as opposed to being in her name. The car is 14 years old and of little value. I am considering bankruptcy and have my own vehicle as does my wife. What will happen to my daughter’s car should I declare bankruptcy? If I give it to her as a gift or transfer the car into her name, it looks like I am committing fraud.
Please Advise – Thank You
You are correct, if you were to simply transfer the vehicle to your daughter it would look like fraud, even though that is obviously not what you intended.
I suggest you have the vehicle appraised; given it’s age it’s probably not worth a lot of money.
If you then decide to go bankrupt, you can make a deal with the trustee to pay the value of the vehicle to the trustee during your bankruptcy. Another option would be to file a consumer proposal.
Either way, you should contact a licensed trustee to fully explore your options.