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*Unsecured debt includes credit cards, lines of credit, bank overdrafts, payday loans, and unsecured personal loans (excluding student loans). It does not include mortgages and car loans.

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If you have unsecured debt of under $10,000 and live in the Province of Ontario filing bankruptcy may not be the best option for you. We suggest you contact the Office of the Super Intendent of Bankruptcy at 416-973-6441 to discuss your options, or you can visit their website here.

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Timing to claim bankruptcy

Is it too late to claim bankruptcy when i am already involved in a court action. The claimant is asking for $9k in damages and is before the small claim courts. I owe $7000 in other debt and I only have made $7K annually salary this year and last. The claimant is refusing to entertain any settlement offers and I am representing myself.

Posted from: British Columbia

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One Response to “Timing to claim bankruptcy”

A licensed trustee said...

You have the right to file bankruptcy at any point in the lawsuit and the legal action will be stayed (that means stopped). The person suing has the right to ask the court to remove the stay if they can demonstrate that you incurred the debt through some type of misrepresentation or malfeasance (you lied or cheated them to get the money). Since the action is in Small Claims it is unlikely, but possible – you need to discuss your situation with a trustee in your area. They can’t comment on the lawsuit – trustees are not lawyers, but they can tell you how bankruptcy may be able to protect you from the suit.