Question: I have a house paid fully if I sell the house or transfer it to another name then file bankruptcy after 3 or 4 months is it ok? is my house safe?
You cannot sell a house and keep the equity then file bankruptcy. If you want to keep your house a better option is to consider a consumer proposal in Ontario.
If you own a house that is fully paid for with no mortgage, and you go bankrupt in Ontario, you will lose your house. Trying to sell the house and hide the proceeds is not an option.
When you go bankrupt you must answer the following question: “Within the last 5 years, while you knew you were insolvent (ie. in financial trouble), did you sell or transfer any assets?” If you were to sell your house, or transfer it, and then go bankrupt 3 or 4 months later, that fact would be disclosed to the trustee. (Even if you lied to the trustee and didn’t disclose the sale you would probably still get caught, since all house sales are recorded by computer and are easily searchable). If you did sell the house, your bankruptcy would probably not end until either you got the house back, or paid to the trustee the equivalent value of the house.
If you need to deal with overwhelming debts and have some equity in your home, you can try either a debt consolidation loan or, if that doesn’t work because you don’t qualify, you could consider a consumer proposal.
Rather than risking doing something you shouldn’t before filing bankruptcy, talk to a trustee today about your options.