How Do I File for Bankruptcy?
Have you been wondering, “How do I file for bankruptcy?” Based on the nature of the question, you’ve likely already made the difficult decision that bankruptcy may be your best option. Here is some good news. The steps for determining eligibility and filing for bankruptcy are uncomplicated. You will have expert help throughout the process, and bankruptcy can be very beneficial.
Am I Eligible to File for Bankruptcy in Canada?
What do you do first when you file for bankruptcy? A good first step is to make sure you’re eligible. Insolvency is a requirement, and the last two prerequisites listed below establish insolvency. The following are requirements to be eligible for Canadian bankruptcy:
- You must either live in or do business in Canada or you must have previously lived in or done business in Canada. It is possible to file for bankruptcy abroad.
- You must have debts amounting to at least $1,000.
- You must be unable to make payments on debts when installments are due.
How Do I File for Bankruptcy?
The first step in filing for bankruptcy in Canada is usually making the decision that it’s the course you’re going to take in dealing with your debts. You’ll need determination and follow-through, because some of the steps involved in ultimately receiving a bankruptcy discharge can be very difficult. For example, you’ll be required to surrender all of your assets for sale during the process. Bankruptcy can also be initiated as a result of a petition for bankruptcy filed by your creditors.
The following are the next steps that answer the question, “How do I file for bankruptcy?”:
- Contact a Licensed Insolvency Trustee to set up a free confidential consultation. You are asked to fill out a form and bring it with you. The meeting typically lasts about an hour.
- Next, the trustee requests that you give thought to everything discussed in the initial meeting. If you are still interested in pursuing bankruptcy, you will set up a time to meet with the trustee a second time. The purpose is to sign related documents to get the process started, which takes between 30 and 45 minutes.
- Within five days of your signing all required documents, bankruptcy information called a Stay of Proceedings will be mailed to your creditors by the trustee. From that time, the creditors of your eligible debts must deal with the trustee. All debt collection phone calls will stop. Interest on your debts will stop accruing. Wage garnishment actions, if any, will stop.
- Each month you will be required to pay an amount established by the government for going bankrupt.
- You are required to attend financial counseling sessions at the trustee’s office.
- After about eight months and after you have signed bankruptcy documents, the trustee is required to report on your conduct throughout the bankruptcy process. Your trustee will recommend an absolute bankruptcy discharge, if your conduct has been proper and all of your duties have been fulfilled.
It will most likely take nine months for the bankruptcy process to be completed and for you to get a fresh financial start, if you get started right away after asking “How do I file for bankruptcy in Canada?”