Owing to Family

April 21st, 2012 by Questions

I am thinking of filing bankruptcy. I owe my parents 18 000, do I include that in my bankruptcy? When I’ve met with previous trustees I only disclosed consumer debt but would it make sense to include them as well or is it pointless cause it’s family….would it make any difference?

Posted from: Ontario


One Response to “Owing to Family”

, A licensed trustee said:

You are required to disclose to your trustee anyone/everyone that you are indebted to when you file for bankruptcy – including family and friends. If you do not and for some reason the family member decides to call the trustee and tell them about the debt you may end up in front of a judge with some explaining to do…

The good news, if you want to call it that, is two fold. First the amount you owe has no impact on filing for bankruptcy – the procedure is the same whether you owe $10,000 or $10 million dollars. Second, when the bankruptcy is over you may repay any of your creditors that you want to – which is what people often do with family loans.

Just discuss the whole thing with your trustee BEFORE you file.

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