Toronto Bankruptcy Trustee Tell You Why And How To File Bankruptcy In Toronto
Once you decide to become bankrupt the bankruptcy trustee completes the paperwork with you and files it with the federal government. Your creditors are then advised by mail and are to deal with the trustee from then on. For secure debts such as car loans and mortgages, you continue to deal with those creditors under the original agreement you made. If you want to end a secured debt and have that creditors' loss included in the bankruptcy, you must turn the secured asset over to the trustee when you become bankrupt.
The payments in a bankruptcy consist of the trustee's basic fee and any requirements to pay surplus income as required by the federal government income rules. If you are receiving GST cheques every 3 months, these will be sent to the trustee until the trustee is discharged. Also, outstanding income tax and those for the year of bankruptcy will be done by the Toronto bankruptcy trustee. Any refunds will be sent to the trustee for those years, however debts up to the bankruptcy date are wiped out.
Most assets, other than basic clothing, furniture or basic vehicle must be turned over to the Toronto bankruptcy trustee. The bankruptcy trustee obtains a fair value for your assets and divides the money amongst your creditors. As the creditors just expect a fair amount for your assets, you can often purchase your items back from the trustee (eg. a second car or home equity) if you can afford to, as mentioned above.
Once bankrupt you must perform your duties which include giving the trustee all of your credit cards, attending meetings if the creditors want one, attending an examination in which the government asks basic questions on your situation (meetings are rare and exams happen occasionally) pay Surplus Income as required by the Federal Government (for at least 9 months if required) and co-operate.
Court actions over debts and garnishments (except for support payments) are stopped.
For someone bankrupt the first time, you are normally out of bankruptcy in 9 months, this is called your discharge. If the Income Rules apply, your discharge could take up to 21 months.
While bankrupt if you receive a windfall (a lottery win, inheritance, etc) the trustee must use these funds to pay off your creditors. If you receive such a windfall after your discharge, as the debts have been wiped out, you would get to keep it all.
Two counselling sessions on money management must be attended to obtain your discharge.
