Bankruptcy is a legal process that immediately stops most collections and actions of creditors including demands on properties and salaries. It gives you the opportunity to become released from your debts and the chance for a new beginning. This process includes counselling sessions that will help you get back control over your finances. In most cases, you can keep properties, such as your home contents, automobile, tools of your trade and you’ll be able to continue to operate your business.
Bankruptcy vs a Consumer Proposal
Both options present advantages and disadvantages and the best one for you will depend on your personal situation. You should talk to a Licensed Insolvency Trustee who will be able to help you to organize a plan of action that best suits you.
What Are the Advantages of Bankruptcy Protection?
Here are some of the advantages of choosing bankruptcy protection:
- Your unsecured creditors will have to stop all of their collection actions against you including legal actions and garnishees on your wages or bank accounts
- You will be able to make a ‘fresh start’ and move on with your life
- It’s usually the fastest way to get rid of your debts
How Much Does a Bankruptcy Cost?
The cost of your bankruptcy will be dependent on a number of factors including the value of your bankruptcy estate and your household income.
How Long Does a Bankruptcy Last?
Normally a bankruptcy takes 9 months from filing to discharge, but there are a number of factors that can change the length of bankruptcy including:
- The amount of surplus income
- Whether or not this is your first bankruptcy
- If there are disputes from your creditors regarding your bankruptcy
- If you fail to comply with your duties as a bankrupt
- Many more
What Is the Meaning of a Discharge?
A discharge is the legal process of a bankruptcy that will release you of your debts. Its duration varies depending on the number of times you have declared bankruptcy. It will last either 9 or 21 months for people that are declaring bankruptcy for the first time. If you have declared bankruptcy more than once, the process lasts for either 24 or for 36 months.