Bankruptcy Question

No, this is not the case, although is one of the more confusing issues surrounding the automatic discharge. The way the legislation works is that if someone who has filed bankruptcy and whose assets are not of a value equal to 50 per cent of the unsecured liabilities and this is as a result of conscious decisions on their part, then there is a risk that the court may refuse to grant an unsecured discharge. In most cases this is never an issue, most all of the bankruptcies we see have assets that are not equal to 50 cents on each dollar of debt and many of those successfully are able to qualify for an automatic discharge.

The answers to these types of questions (specifically the assets) are based on provincial legislation and are good issues to discuss with a local trustee. As for the bankruptcy process, essentially it is a way that you can be cleared from the majority of your unsecured debt, and it usually lasts 9 – 12 months in length depending on how quickly one is able to comply with certain required tasks. For instance, in a bankruptcy each individual is required to make their mandatory trustee payment, attend 2 counseling sessions, keep track of their income and expenses for a minimum of 9 months and submit tax information to the trustee’s office. There can be some additional duties during a bankruptcy depending on the specifics of the situation, but most can expect that at a minimum these are the types of things they will have to complete.

The best thing to do is to contact a local trustee, they will be willing to provide a free consultation where they will review your situation and the options available and help you to determine what is going to be the best fit for your situation.