When to Claim Bankruptcy/Insolvency

April 8th, 2010 by Questions

I have been told that it is best to claim bankruptcy after you return to work from a lengthy loss of income. What are the pros and cons of this?

Posted from: Ontario


One Response to “When to Claim Bankruptcy/Insolvency”

, A licensed trustee said:

Sorry, but that’s not a question I can give you a “quick” response to. If you file while unemployed or on insurance benefits your income is usually lower and therefore the bankruptcy may be less expensive (the cost to file is based on your income – the mnore you earn the more you’ll pay to file). Of course with lower income you have less money available to pay your regular bills, let alone the cost of filing for bankruptcy.

If you wait until you return to work you should have more money available to pay your regualr bills, but the higher income might also mean the bankruptcy may cost you more and run for a longer period of time.

The best advice is to contact a trustee in your area and go and sit down with them. They’ll review your options in detail and then you can make an informed decision regarding the best path for you to follow.

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