Bankruptcy Seizure & Co-Signed Loans

Bankruptcy & Co-Signers

When someone is declared bankrupt, the bankrupt’s assets vest in the Trustee and the Trustee may take possession of and sell these assets for the general benefit of the bankrupt’s creditors.

If there are co-signors on a debt, when one of the co-signers files for bankruptcy the other co-signer is then responsible for the debt in full less any amounts that the creditor MAY receive from the bankruptcy. However, payment of funds from the bankruptcy will take a minimum of 1 year and the creditor will likely require payment by the co-signor well before any distribution.

It should be noted that there are items that are exempt in the province of Ontario. Section 67 of the Bankruptcy and Insolvency Act has 4 categories regarding exempt property.

  • property held by the bankrupt in trust for other persons;
  • property of the bankrupt that is exempt from seizure under the applicable provincial law where the property is situated and where the bankrupt resides;
  • GST credit payments and prescribed payments relating to the essential needs of individuals; and
  • Contributions to Registered Retirement Income Funds or Registered Retirement Savings Plans more than 12 months before bankruptcy.

The Provincial exemptions are set to allow a person to retain basic property/items.

In Ontario, the Provincial exemptions are as follows:

  • necessary and ordinary clothing of the debtor and his or her family – (NO LIMIT);
  • household furniture, utensils, equipment, food and fuel contained in and forming part of the debtor’s permanent home up to a prescribed amount or $11,300;
  • business tools, instruments and other chattels not exceeding a set amount or $13,150.00 ;
  • an automobile up to a prescribed maximum value or $6,600.00 ; and
  • Most pension plans and life insurance policies.
  • Equity in principal residence if it is less than $10,000.       (If the equity is more than $10,000, there is no exemption at all)

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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