What Happens After Bankruptcy?

What Happens After Bankruptcy

Table of Contents

Once you file Bankruptcy, you will only be dealing directly with your Licensed Insolvency Trustee. Your trustee will now be dealing with your creditors on your behalf.

If there are any wage garnishments against you, this will stop, and if there are any lawsuits from your unsecured creditors, these will also stop.

What happens to your assets

After becoming bankrupt, the next part of the process is your Licensed Insolvency Trustee will start selling your assets. Note that there are some assets that are not included in the sale, some assets that you are able to keep. See here for more info on this.

It is extremely important to notify your trustee about all your assets and to also let them know about any of your properties that were transferred and/or sold over the past few years.

What happens next is that your Licensed Insolvency Trustee will then hold the money that was gained from the sale of those assets, for distribution amongst your unsecured creditors.

Your Licensed Insolvency Trustee will handle all communication with your creditors

When you declare bankruptcy, your trustee will handle the job of letting your unsecured creditors know about your recent bankruptcy. So you will no longer need to deal with them directly.

What is Surplus income and how can it impact your payments?

Each month, your pay stubs and any other means of income will need to be submitted to your trustee, and they will then calculate your surplus income.

The Surplus Income level lets the Trustee know if an individual in Bankruptcy earns enough money to be required to make surplus income payments into their Bankruptcy Estate These levels are set by the Superintendent of Bankruptcy, and the income is based on household income total.

Surplus income is simply the amount that you earn that goes over the income amount that a family needs to uphold a reasonable standard of living. The larger your family, the more you are able to keep. See the table below for more information regarding 2015 levels.

If there is a Surplus Income what happens?

  • For first time Bankrupts – Bankruptcy is increased from 9 months to 21 months
  • For Second time Bankrupts – Bankruptcy is increased from 24 months to 36 months

For more information from the Office of the Superintendent of Bankruptcy

Superintendent's Standards – 2022

Meeting of Creditors (If Called)

The purpose of the meeting of creditors is to allow your unsecured creditors gain the necessary information on your bankruptcy. Confirm the appointment of the bankruptcy trustee. Assign up to 5 inspectors to oversee the administration of your estate, and to let your creditors provide direction to the trustee.

OSB Examination (If Required)

If required, you may be examined (under oath) by an OSB rep after your bankruptcy filing. This is to ask questions regarding the causes of your particular bankruptcy case, possible questions regarding conduct and the disposition of your property.

Counselling Sessions

An important part of your bankruptcy are the counselling sessions. This is to explore the reason(s) why you ended up in bankruptcy and to provide the necessary knowledge and tools to manage your finances going forward.

Bankruptcy Discharge

After you have completed your bankruptcy, you are then discharged and this releases you from any legal obligations to the unsecured debts that were included in your bankruptcy.

With a first bankruptcy and no surplus income payments, then you are eligible for a discharge from your bankruptcy in 9 months. If there are surplus payments (in your 1st bankruptcy) then you will be eligible for a discharge in 21 months.

Automatic Discharge

You will be automatically discharged from your bankruptcy if

  • Your discharge is not opposed by a trustee, the Office of the Superintendent of Bankruptcy or one of your creditors.
  • Your financial counselling sessions are completed
  • It is your 1st or 2nd Bankruptcy
  • You provided monthly all information to your Trustee as requested during your bankruptcy.

 What if I am not eligible for Automatic Discharge?

If at the end of your bankruptcy term you do not qualify for automatic discharge, your discharge is considered to be opposed and you will need to attend Bankruptcy Court to have your discharge decided.

With an opposed discharge, your trustee will contact you and let you know the reasons why you are not discharged from your bankruptcy. There may still be certain conditions that need to be completed first.

Before your discharge hearing, your trustee will prepare a report which will let the court know the reason(s) you were not eligible for an Automatic Discharge and suggest conditions that should be met before your bankruptcy discharge will be granted. Generally, the report will;

  • Entail details regarding your finances,
  • The bankruptcy cause,
  • Your conduct both before and after becoming bankrupt,
  • If you were convicted of any offense (sections 198 to 208), and;
  • State any fact that could let the court know a reason to refuse your discharge from Bankruptcy.

The Court will consider the facts in this report and any facts that you the bankrupt may present at the hearing. Once the Court considers all the facts, they will make a decision as to what, if any, conditions that must be met before you can be granted a discharge. Once these conditions are met, you will be discharged from your bankruptcy.

Debts that are not included in Discharge

When you are discharged from your bankruptcy, you are then released from any legal obligations regarding the unsecured debts covered within your bankruptcy. Note that there are certain debts that bankruptcy does NOT release you from your obligation to pay. Debts that are excluded are,

  • alimony arrears and payments;
  • child support arrears and payments;
  • student loans, (providing at the date of bankruptcy it was less than 7 yrs. from the time when you ceased to be a full/part-time student)
  • a fine or penalty imposed by the court; and
  • Any debts from fraud.

Take Your First Step Towards A Debt Free Life

If you are overwhelmed by debt, call us at 1-844-962-9200 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. 

Share This!

Christine Sylver was very helpful to my situation. No question asked, she went above and beyond just to give me the options that I need to solve my problems. She explained and made me understand my options. Thank you Christine! Everything was done in a week. Regards, to Richard Sklar for explaining everything further to me. 😊
Kris
1685201109
I was blown away by how kind and empathetic Christine and David were. I came into the process expecting to feel embarrassed, but they were so helpful and unquestionably supportive, they made the whole experience a positive thing. On top of that, Christine found a solution for me that was better than I ever could have imagined. I highly recommend Christine, David, and colleagues to anyone.
Mary M
1684189795
Christine Sylver has been very efficient in working with me in all aspects toward developing a very favourable consumer proposal which meets my financial budgeting very nicely. She also exhibited a very positive pro client attitude and was every pleasant to communicate with. Richard Sklar also demonstrated a very positive pro client attitude in explaining in detail all aspects. All great!!
Rob Hultgren
1683919919
Dealing with Christine was a real pleasure.She was very understanding professional and knowledgeable she answered all my questions.I left feeling relieved a big burden was lifted from my shoulders
John Horan
1683830383
Very happy I got in touch with Jackie! She has been a great help and a pleasure to work with! I highly recommend Jackie if you need help getting out of financial debt.
Hailey Cascagnette
1683647325
I had the pleasure of working with Jackie and she made the experience very easy and was very honest which I appreciated as I was extremely nervous to go through with the process. Any questions or concerns I've had after our meetings were answered no problems and although it's been a few weeks I can honestly say I've never felt so stress-free. Very thankful for Jackie.
Cassandra Arevalo
1683644364
Very considerate of how people can sometimes make mistakes and need help to get things back on track. Great team of people. Thanks to Jacqueline for all her help.
Kevin Chase
1683498014
My mother told me about this firm because they helped resolve her situation nearly 25 years ago. I had the pleasure of working with Christine Sylver. I should’ve done this years ago but I am where I am and it is what it is. Extremely courteous, professional and understanding. I hope to never need their services again but they would be my first call! A+
Patrick Martel
1683324165
Jerry was extremely thorough and ensured that as a client, I understood all of my options and their repercussions. He offered his professional advice best suited for my situation and he is amazing at his work. Thank you Jerry! :)
Stephanie Belanger
1683317517
Great experience with Jerry and staff. Thank you.
Harold Hutchings
1682737038
js_loader
DS david skalr icon

Book your free consultation.

Call 1-844-962-9200 or fill out the form below. We’ll do the rest.

Contact Us