Yes, you can but it depends on several factors including your income, job stability, and debt level. If you cannot reach the debt ratio required by financial institutions, you cannot consolidate your debt. In that case, we recommend you meet with a Winnipeg Trustee in bankruptcy.
There are three ways to eliminate debt:
The steps to bankruptcy are as follows: assessing the situation, signing the documents, and filing for bankruptcy, reporting your monthly income, the two follow-up counselling sessions, and discharge.
In terms of time, expect it to take at least nine months for a first time bankruptcy provided you do not have any income exceeding the standard amount deemed to be reasonable by the Government of Canada. If your income exceeds the standard amount deemed to be reasonable by the Government of Canada it may last 21 months.
The process is longer for a second time bankruptcy. It will last 24 months provided you do not have any income exceeding the standard amount deemed to be reasonable by the Government of Canada. If your income exceeds the standard amount deemed to be reasonable by the Government of Canada it may last 36 months.
According to the Bankruptcy and Insolvency Act, people with $1,000 in debts can declare bankruptcy if they are unable to pay their debts on time. In practice, when someone has less than $5,000 in debts other solutions may be considered.
Yes, there are several ways for people to get out of debt including consumer proposal and debt consolidation. One of our professional team members will explain your options to help you make the best choice for your situation.
Most debts, but not all are discharged through the bankruptcy process.
Examples of debts not discharged are:
secured debts (e.g. mortgage or car loan);
child support, maintenance, alimony
Court fines, penalties and traffic offences
debts obtained by fraud or fraudulent misrepresentation
student loans, if less than seven years since leaving university or college
civil claims arising from personal or sexual assault
A secured creditor is a lender to whom you have pledged one of your assets as collateral to obtain a loan or mortgage. For example, when you purchase a home, it is used as collateral for the mortgage. Or if you obtain a loan, the vehicle you own may be taken as collateral against the loan.
Quite often, when you obtain a loan directly from a company such as CitiFinancial or Household Finance they will grant the loan but also take collateral on a vehicle, if you have one, and your household furnishings.
One word of caution: If you decide to retain financed assets and then decide later, after bankruptcy, that you would like to return the asset, the creditor may have to be repaid all amounts due. Finally, no debtor should make arrangements to reaffirm a loan and retain an asset until the secured creditor has filed a claim with the Trustee and the security is valid and has confirmed that the Trustee has no interest in the asset. If you are unsure whether a creditor has collateral against your assets you can do a Personal Property Registry search at any Ontario registry office.
These answers to frequently asked questions are provided as general information only. Each individual's situation is unique. For help getting out of debt, call us in Winnipeg at 204-594-7160 or toll free in Manitoba at 1-866-941-6353 for a free, no obligation, confidential consultation.