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Bankruptcy - Consumer Proposals - Counselling

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Maria Rickard, B.A., C.F.E., C.I.R.P
Licensed Insolvency Trustee

Maria Rickard & Associates Inc

TORONTO

1351 Dundas Street West, Toronto, M6J 1Y3

Phone: (416) 534-2777
Fax: (416) 534-5605
Email: info@mariarickard.com

SAULT STE. MARIE

123 March Street, Suite 407, Sault Ste. Marie, P6A 2Z5

Phone: (705) 942-1069
Fax: (705) 942-3210
Email: soo@mariarickard.com

Frequently Asked Questions (FAQs)

WILL I LOSE MY HOUSE AND CAR?

Filing a bankruptcy or proposal does NOT mean automatic loss of your home or car.  In many cases, it is possible for the bankrupts to keep their home and car.

WILL I LOSE MY RRSPS?

The only portion of RRSP savings that are seized in a bankruptcy, are any contributions made by the debtor in the 12 months preceding the filing of a bankruptcy.  The circumstances are different in a consumer proposal, as assets are not seizable in a proposal.

WILL I LOSE MY FURNITURE AND PERSONAL EFFECTS?

Furniture and personal effects are exempt from seizure, and protected in the hands of the bankrupt up to a maximum current (not replacement) value of $11,300 for furniture, and $5650 for personal effects.

WHAT IF MY CAR IS OWNED, NOT FINANCED?

If a bankrupt’s motor vehicle is worth less than $5,650.00, it is exempt from seizure, and protected in the hands of the bankrupt.  An arrangement can be discussed with the Trustee for any value over $5,650.00.

CAN MY WAGES BE GARNISHEED?

Any collection action, including wage garnishment is stopped on the filing of a bankruptcy or a proposal.  The only garnishment that would continue would be payments through the Family Responsibility Office for support.

CAN I HAVE A BANK ACCOUNT?

YES - however, we suggest that a bankrupt not do business with a bank they owe money to, or whose debt has been declared in the bankruptcy or consumer proposal.

IS MY SPOUSE AUTOMATICALLY RESPONSIBLE FOR MY DEBTS?

A spouse, or any individual is responsible for only those debts they have legally signed for and agreed to pay, I.e. Co-signing.  No spouse is responsible for the debt of their bankrupt spouse, simply by being married to them.

WILL I HAVE TO GO TO COURT?

In the vast majority of cases, the answer is no.  If the bankrupt honours the few duties required of him under the Bankruptcy and Insolvency Act, they would normally receive an “automatic discharge”, which requires no court attendance.

WILL I BE UNABLE TO HAVE CREDIT FOR 6 OR 7 YEARS?

There will be record of your bankruptcy with the credit bureau(s) for 6 years from the date of discharge.  This is NOT how long you are forbidden to apply for credit.  All creditors have their own policies with respect to when they will extend credit, once a bankrupt has been discharged.  A bankrupt can begin to re-establish credit as soon as they have received their discharge.

WILL THE TRUSTEE TAKE MY PAYCHEQUE?

NO - a monthly payment may be required by the bankrupt.  This is arranged with the Trustee, but the bankrupt remains in control of his wages.