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Personal Bankruptcy Service in Edmonton

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Learn About Bankruptcy

No one wishes to file for bankruptcy, but it may be a reasonable option if you find yourself without enough resources to pay for overwhelming debt.

Declaring personal or business bankruptcy can provide you with an opportunity to start fresh and settle your obligations as reasonably as possible.

What Is Personal Bankruptcy?

Personal bankruptcy is declared for various reasons but boils down to when a person (the debtor) is unable to repay their debts regardless of the reason.

Initially, the debtor will describe their financial situation to a Licensed Insolvency Trustee (LIT) and provide the trustee with the required information, including a list of assets.

Once appointed by the Office of the Superintendent of Bankruptcy regarding your file, the trustee is legally required to manage the debtor’s bankruptcy term, usually 9 months.

Declaring personal bankruptcy may be a reasonable action to take given the debtor’s specific and unique circumstances.

The Bankruptcy Process

Click each title to learn more about the bankruptcy process, what you will need, and what you can expect.

Requirements

The Bankruptcy and Insolvency Act lays out the requirements for bankruptcy. To qualify, you:

  • Must be a resident of Canada
  • Are unable to pay your bills when they are due
  • Owe more than $1,000

While many people can make these qualifications, your trustee may recommend to you the best course of action to deal with your financial situation since there may be other options open to you.

Once you have chosen your Licensed Insolvency Trustee, you will need to discuss your financial situation with them. For this meeting, you should have lists of your creditors and assets, as well as all of your personal information (name, birthdate, address).

After you and your trustee go over your options, the next step is to review, understand and commit to file for bankruptcy should that be the best option available to you.

If this is the first time you have filed for bankruptcy, you will have a 9 to 21 month period of bankruptcy.

During this period, there will be a “stay of proceedings,” which means unsecured creditors cannot contact you for payment, begin or continue lawsuits, or implement wage garnishees.

You will also need to attend 2 financial counselling sessions, teaching you how to manage your budget better.

Your bankruptcy ends when you receive your “discharge,” effectively cancelling all your debts. Your discharge might be extended if you are making a surplus income in excess of the income limit set by the government.

This will require a portion of the income to be paid towards your bankruptcy. The discharge can also be extended if this is not your first bankruptcy.

Advantages & Disadvantages

Advantages

  • Provides legal protection from unsecured creditors
  • Halts debt collecting agents
  • Ensures essential services
  • Eliminates most unsecured debts
  • Cost is inexpensive compared to the cost of debt load
  • Diminished anxiety about overdue accounts and payments

Disadvantages

  • Co-signers of loans will be responsible for said loans
  • Some debts might still be enforceable (i.e. mortgages)
  • Credit cards must be turned over to the trustee
  • There will be a notification of bankruptcy included on credit reports

How Debts Are Addressed

Debts are classified under different categories. Read about unsecured debts, secured debts, assets, and liabilities.

Secured & Unsecured Debts

There are 2 types of debts you can procure: unsecured debts and secured debts. Most unsecured debts can be discharged after the set bankruptcy period. Some of these debts include:

  • Credit card balances
  • Medical bills
  • Retail store accounts
  • Unpaid utility bills
  • Payday loans

However, some unsecured loans will stay after bankruptcy, including:

  • Student loans less than 7 years old
  • Child/spousal support
  • Court-ordered fines and debts

Secured debts, like a mortgage on an asset like a car or house, will not be discharged after bankruptcy.

Quite simply, assets are what you own, and liabilities are what you owe. Assets can include chequing and savings accounts, cars, houses, furniture, or even artwork. Liabilities are debts like mortgages, car payments, and credit card balances.

Knowing your assets and liabilities is a conversation you will have with your trustee, as selling your assets can be put towards the repayment process determined by your trustee.

What’s Next

After the 9-month bankruptcy period, unsecured debts will be wiped away, and you will no longer owe money towards them.

In most cases, continued non-payment of debt has had an ongoing negative effect on your credit rating. This will continue with the declaration of bankruptcy for up to 6 years. 

That said, bankruptcy may allow you to step out from under the situation and help find balance from overwhelming debt, anxiety, and fear of being unable to repay your debts. The trustee will advise you and provide you with counsel to get yourself into a refreshed financial situation.

If you are facing the pressures of debt overload, be sure to talk to us. Not only will we provide expert advice and knowledge to guide you through a difficult time, but we can help you to reset your financial future.

Where To Find Us

Find us in the First Edmonton Place building on the corner of Jasper Avenue and 107th Street, behind the Corona LRT Station. Street meter parking is available along Jasper Avenue as well as 106th and 107th Streets, and paid surface parking is off of 106th Street, and underground parking for First Edmonton Place is off of 107th Street.

A.C. Waring &
Associates Inc.

  • First Edmonton Place
    410-10655 Jasper Ave NW
  • Edmonton, AB T5J 3S9

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