The bankruptcy process is not as complicated as many think. In fact, there are only four main qualifications to apply for personal bankruptcy in Ontario:
- You need to owe at least $1,000;
- Be unable to pay your debts;
- Have stopped paying your debt; and
- Have debts greater than what you own.
When you meet with your trustee, they will help you determine whether personal bankruptcy is the right option for your situation. Quite often, those who intend to file for bankruptcy find out that an alternative, such as a consumer proposal, makes more sense for them.
If you choose to file bankruptcy, the process is easy and your trustee is there to guide you through it. Once you’ve started your bankruptcy, you’ll have straight forward duties to complete to receive your discharge and eliminate your debts.
While your bankruptcy application can’t be denied, getting out of bankruptcy can involve complications if you don’t complete all these duties. Your debts aren’t gone until you are discharged from your bankruptcy: That is the important step in the process.
In order to be discharged you have certain duties to perform such as making the required payments, attending credit counselling and reporting your income. If you fail to perform your duties, the licensed insolvency trustee will oppose your discharge. A court hearing is then required and the court will make a court order outlining what you need to do. Until you do what the court states you will not be discharged. Eventually your Trustee will close the file and you will no longer have the bankruptcy protection. Filing for bankruptcy is a serious matter, and you need to take steps to make sure you do what you need to in order to be discharged.
Although rare, the Office of the Superintendent of Bankruptcy can also object to your discharge. As above, a court hearing is held to determine if you will get your discharged.
Your creditors can also object to your discharge from bankruptcy. If a creditors objects, the creditor, or the lawyer, will let the court know what issues they have. You, or your lawyer, also have the opportunity to present your facts to the court. The court will then determine what happens with your bankruptcy. The court can:
- Grant your discharge that day,
- Grant your discharge at another day in the future,
- Grant your discharge on the condition you pay funds,
- Refuse to give you your discharge.
If you are thinking about filing for bankruptcy, it’s best to speak with a licenced bankruptcy Trustee to see if you quality and to help you to understand the process in detail.
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