People start thinking about declaring bankruptcy when the burden of their debts and subsequent stress make it almost impossible to enjoy life. People in this situation are typically honest but unfortunate. They often find that a meeting with a bankruptcy trustee reveals other options, such as debt consolidation or a consumer proposal.
In Canada, you can ONLY apply for bankruptcy after a bankruptcy trustee has first assessed your financial condition (debts and assets) and found that you are insolvent. Depending on where you live, there are provincial variations in bankruptcy legislation which affect the assets you are allowed to keep after bankruptcy.
While not something to be undertaken lightly, bankruptcy can be the beginning of a new, saner approach to finances. It is an opportunity to be relieved from a crushing debt burden that makes all aspects of life extremely difficult.
Bankruptcy in Canada is set out by federal law, in the Bankruptcy and Insolvency Act and is applicable to businesses and individuals. The Office of the Superintendent of Bankruptcy, a federal agency, is responsible for ensuring that bankruptcies are administered in a fair and orderly manner. Trustees in bankruptcy administer bankruptcy estates.
Bankruptcy is filed when a person or a company becomes insolvent and cannot pay their debts as they become due.
Some of the duties of the trustee in bankruptcy are to:
- Review the file for any fraudulent preferences or reviewable transactions
- Chair meetings of creditors
- Sell any non-exempt assets
- Object to the bankrupt's discharge
- Distribute funds to creditors
Call us today to start the bankruptcy evaluation process.