5 Bankruptcy Facts You Should Know Before You File

Bankruptcy is a major financial decision, but for many, it’s their only way out of debt. Before you file for bankruptcy, there are a few things you should know about the process.

1) You Need a Bankruptcy Trustee in Ontario

If you’ve decided it’s time to declare bankruptcy, you need a bankruptcy trustee in Ontario, now known as a Licensed Insolvency Trustee. Bankruptcy trustees are licensed by the Canadian government and they are the only professionals who can file bankruptcy on your behalf. That’s what we do at David Sklar & Associates.

2) Disclosing and Assigning Your Assets

home equity

One of the first things you will learn about personal bankruptcy from a bankruptcy trustee is that you will need to disclose your assets and assign them to a bankruptcy trustee. The trustee then uses those assets to repay your creditors. Property such as a basic car and a limited amount of equity in your home is exempt. When you come to David Sklar & Associates, we can provide more information about exempt assets and specifically what you may lose.

3) You May Have to Pay Surplus Income

As part of your bankruptcy, you will also have to report your income and living expenses to your bankruptcy trustee. During the bankruptcy process, you may need to pay a portion of any surplus income to settle your debt. Your surplus income is dependent on the size of your family. You can check out the 2018 surplus limits on Bankruptcy Canada.

4) Discharge Time Depends on Certain Factors

Bankruptcy isn’t immediate. There is a period of time in which you will have to pay surplus income. For first-time bankruptcies, usually, you are automatically discharged after 9 months. If you are paying surplus income, it may be up to 21 months before you are discharged. This differs from a consumer proposal in that they can last up to five years, though the processes are different.

5) Bankruptcy Is Your Last Resort

There may be better options than bankruptcy available to you, including consumer proposals. Consumer proposals do not require you to sell any of your assets. Instead, you pay back your debt in fixed monthly payments, potentially with a reduction in how much you owe. Giving up assets such as investments, property, or equity can set you back financially. Save bankruptcy as a last resort. It helps if you book an appointment at David Sklar & Associates sooner than later to discuss alternatives.

If you’re worried about bankruptcy, stop by our office in Ajax, our head office in Toronto, or our location in Mississauga and offices in Brampton. First consultations are free with no obligation. A bankruptcy trustee is here to help you get out of debt.

Get more bankruptcy information before you decide to file. The more you know, the better prepared you will be for the consequences. If you’re struggling with debt, get help sooner than later. The earlier you start, the better off you will be.

Take Your First Step Towards A Debt Free Life

If you are overwhelmed by debt and live in the Toronto area, call us at 416-498-9200 to book a FREE, confidential appointment. We will review your financial situation in detail and discuss all of your options with you. Alternatively, you can fill out the form below and our team will reach out to you. 

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The best decision I've made was to contact David Sklar & Associates, they are experts in this matters and also have dedicated Licensed Counsellors that provide the best customer support, like Rhoda Lewis, who I highly recommend. She worked tirelessly on my case, explaining ever detail to me willingly. She demonstrates a true interest in her clients. I appreciate how she patiently walked me through what to do, step by step. I now have control over my finances, as a result my life is much more peaceful and I can focus on what matters. Thank you!
Nilda H.
20:18 16 Jun 22
Very helpful and friendly! I am more than satisfied with my experience here. And more than happy with the outcome! Would definitely recommend .
Peggy Bulger
15:10 14 Jun 22
Jerry at David SKLAR helped me thoroughly understand my options and made me feel at ease. If you are looking at this type of service/help, I 100% recommend you give them a call.
Colleen H
12:50 14 Jun 22
Rhoda is a wonderful person, She help me and guided me throughout the process. I couldn’t do it without her support and expertise. Now I can start fresh and full of hope of a better life ahead of me.
ariezel erandio
21:33 06 Jun 22
The service I recieved from David Sklar and Associates was great. I was able to meet with Christin Sylver. She is kind, understanding and, professional. She was able to answer all the quesions that I had regarding my debt. At the end of our meetings, I felt that there is a heavy burden lifted from my shoulders. I recommend Chistine to anyone who is looking into debt relief.
Aliya H
12:11 04 Jun 22
Jerry is a very patient person, he answered all my questions and made this experience so smooth and easy for me. I was not sure what to expect but dealing with him made me feel so much better. He sure knows what he is doing and how to put people at ease for sure (should have done this long ago). I recommend him to anyone I am so glad I had him on my side and now to do my part. Thanks Jerry ur greatPattie
Patty Murphy
21:34 18 May 22
Rhoda Lewis helped me achieve a fresh start two and half years ago! She was very professional with a very warm, caring personality! I emailed her today with a question and she responded quickly. She's great at her chosen profession!!
Debbie Livingston
01:24 11 May 22
Nothing but good things to say about Jackie. She was so nice and so understand and everything was so quick and easy. In a matter of a week, there was the solution that I never thought was possible. Thank you so very much for everything that you have done. ❤️❤️❤️
Cassandra Keenan
21:05 10 May 22
I was in a lot of debt and stress, Jackie Stanley with David Sklar & Associates was very professional, and extremely helpful with getting out of debt. I should of did this sooner, they take the all the weight and stress of a persons shoulders, amazing team at David Sklar & Associates!!
Hubert Z
03:08 10 May 22
Jackie helped me out during a really tough time and she made the entire process very easy and painless. I highly recommend reaching out to her if you find yourself in any financial trouble. You won’t be disappointed!
prettylush 13
02:42 10 May 22
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