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Bankruptcy works by providing an honest but unfortunate debtor with a fresh financial start. The decision may be difficult but the process is straight forward.

Step 1 - put together a list of your debts and a list of your assets.

Step 2 - set up a meeting, either over the phone or in person, with a Licensed Insolvency Trustee to discuss your options.

Step 3 - sign the bankruptcy papers. The Trustee is responsible for letting your creditors know that you are protected by bankruptcy.

Step 4 - complete monthly income and expense forms for each month during your bankruptcy which in most cases is 9 months, and attend two informal counselling sessions.

Step 5 - obtain your discharge from bankruptcy and begin your FreshStart!

If you find yourself constantly worrying about bills that are piling up, wondering where the money will come from to buy groceries let alone pay down those bills, or are simply living pay cheque to pay cheque without any sign of relief, bankruptcy will work for you.

We are pleased to offer a free consultation to discuss your options.

 

Lawrence Crandall, LL.B, CIRP, Licensed Insolvency Trustee

Licensed Insolvency Trustees
Tel: 1-888-455-6060
www.freshstartatlantic.ca
Fresh start…the road to financial freedom

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You owe it to yourself and your loved ones to give your financial situation some time and attention.  This is especially the case if your situation is one which is more than just a temporary set-back.

Calling a trustee to review your situation is a logical place to start.  Trustees are licensed by and accountable to the Federal Government.  Most work exclusively with individuals and businesses experiencing financial difficulty.   Having an impartial assessment of your situation can assist by pointing out issues and options to consider and validating concerns you now have.  Trustees can share their experience gained in assisting many individuals and families face similar challenges. 

At no cost or commitment and a minimal time investment, you are able to obtain practical and relevant information, guidance and advice.   Our experience is that debtors who take control of their situation relieve a lot of pent up anxiety and stress, regardless of the eventual course of action they choose.

 

Kristi Neilsen, BComm, CIRP, Licensed Insolvency Trustee

Licensed Insolvency Trustees
Tel: 1-888-455-6060
www.freshstartatlantic.ca
Fresh start…the road to financial freedom

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Not necessarily. If there is a loan against your recreational equipment, you may continue making the monthly loan payments if you can afford to do so. This is because the loan company is typically a secured creditor and is not affected by the bankruptcy.

You will have to make arrangements with the Trustee if there is any equity in your recreational equipment. Equity is the difference between the value of the item and the amount owing on the loan. If there is equity, then you will have to pay the equity to the Trustee if you want to keep your recreational equipment. In most cases, the person going bankrupt arranges a monthly payment to the Trustee to pay off the amount of equity.

If you cannot afford to continue the monthly payments to the loan company, then you can choose to give up the recreational equipment as part of the bankruptcy. When doing so, as part of a bankruptcy, you do not have to worry about the creditor suing you for the amount left owing on the loan.

We are pleased to offer a free consultation to discuss your options.

 

Julie Molasky, CIRP, Licensed Insolvency Trustee 

Licensed Insolvency Trustees
Tel: 1-888-455-6060
www.freshstartatlantic.ca
Fresh start…the road to financial freedom

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An executor has to be cautious while administering the estate of the deceased person. This is particularly true if the debts of the estates are more than its assets. If this is the case, keep in mind the following:

 

  • Simply being the executor of an estate does not make you personally liable for the debts of the estate. The liabilities of an estate can encumber its assets, but this liability does not extend to other people unless they guaranteed the debts of the deceased person.

 

  • An executor can be personally liable to the creditors of an estate if the executor distributes the assets without paying the claims of creditors.

If you are the executor of an estate which you believe may be insolvent, one option may be for the estate to be assigned into bankruptcy.

 

Jean Goguen, CPA, CMA, CIRP, Licensed Insolvency Trustee

Licensed Insolvency Trustees
Tel: 1-888-455-6060
www.freshstartatlantic.ca
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If you have concerns about your business’ finances, you should consult a Licensed Insolvency Trustee as early as possible.

Many people are under the mistaken belief that a trustee’s only function is to wind up or liquidate a business. In reality, a trustee can play an important role in a business’ strategy to rebuild profitability.

A trustee offers options to businesses, both informal and formal, to help return a business to being profitable. Informal options include examining your business’ financial situation, helping build a new business operation plan, helping deal with employees and ultimately help negotiating with your business’ creditors and lenders. Having a trustee as part of your business’ team will not only add a significant body of knowledge and experience, but will also add credibility to your restructuring efforts.

Formal options could include a proposal to creditors under the Bankruptcy and Insolvency Act or an application pursuant to the Companies’ Creditors Arrangement Act.

Regardless of whether you decide to proceed with an informal or formal restructuring process, the outcome will be easier and more successful if you consult a trustee sooner rather than later.

 

Henry M. Franchville, CA, CIRP, Licensed Insolvency Trustee

Licensed Insolvency Trustees
Tel: 1-888-455-6060
www.freshstartatlantic.ca
Fresh start…the road to financial freedom

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Getting a “consolidation loan” may not be the best solution to getting your debts resolved.

Consolidation loans often bear a high interest rate, particularly if the borrower has poor credit history or a high current debt load.

Often the lender will require you to provide collateral for the consolidation loan.  Once the loan is secured (for example, by a mortgage on your house) the lender can sell your house if you are unable to keep up the loan payments.  Secured loans are not normally able to be settled in any informal or formal debt settlement arrangements.

The consolidation loan will not relieve you of any debts and will not reduce your overall debt load.

Before obtaining a consolidation loan, you should consider whether a Proposal to settle all or part of your debts will work better for you.  A Proposal offers a way of eliminating ongoing interest and settling your debts with an affordable monthly payment. 

 

Larry Crandall, LL.B, CIRP, Licensed Insolvency Trustee

Licensed Insolvency Trustees
Tel: 1-888-455-6060
www.freshstartatlantic.ca
Fresh start…the road to financial freedom

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It doesn’t matter if you have bad credit. The bank must allow you to open a bank account even if you have previously filed for Bankruptcy or if you aren’t currently employed. In order to open a bank account you must have the required identification.

The bank can however, refuse you an account with overdraft protection if you do not meet their application criteria. This isn’t a bad thing because the interest rates charged on overdraft protection are usually higher than a line of credit or even some credit cards.

If you have any problems with respect to opening a bank account you should contact the Financial Consumer Agency of Canada (FCAC) toll-free at 1-866-461-3222.  

 

Kristi Neilsen, BComm, CIRP, Licensed Insolvency Trustee

Licensed Insolvency Trustees
Tel: 1-888-455-6060
www.freshstartatlantic.ca
Fresh start…the road to financial freedom

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Yes, you can declare bankruptcy again if you’ve been bankrupt in the past.

In September of 2009, the Bankruptcy and Insolvency Act was amended to make a second-time bankruptcy more streamlined.

Before these amendments, second-time bankrupts were not entitled to an automatic discharge and had to apply to court to be discharged from bankruptcy.

The September 2009 amendments allow for a second-time bankrupt to receive an automatic discharge. This means that second time bankrupts can deal solely with their trustee and are not required to go to court. Second-time bankrupts will be in bankruptcy for 24 months before being eligible for their automatic discharge (36 months if they have surplus income).

If this is your third bankruptcy, you will not be eligible for an automatic discharge.  The trustee will need to apply to the Court for a hearing of your application for discharge. 

Please contact us for a free consultation where we can explain more about the process of bankruptcy for multiple time bankrupts if this applies to you.

 

Julie Molasky, PAIR, Licensed Insolvency Trustee

Licensed Insolvency Trustees
Tel: 1-888-455-6060
www.freshstartatlantic.ca
Fresh start…the road to financial freedom

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RESP’s are assets of the plan holder, usually the parents.  RESP’s are not an exempt asset in bankruptcy.

However, this does not mean it must be cashed in during a bankruptcy or proposal.  Prematurely cashing in the investment will result in receiving substantially less than the carrying value as the government grant portion would not be refunded.  There may also be fees and termination costs.  A trustee will work with you to try to find a solution which leaves the investments intact but gives the creditors value equal to the amount they would have received if the RESP was collapsed.  

 

Jean Goguen, CPA, CMA, CIRP, Licensed Insolvency Trustee

Licensed Insolvency Trustees
Tel: 1-888-455-6060
www.freshstartatlantic.ca
Fresh start…the road to financial freedom

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Your Trustee does your income tax return for you when you file for bankruptcy. In the year that you file for bankruptcy your Trustee does 2 separate returns. One from January 1st up to and including the day of bankruptcy (Pre) and another separate return from the day after the bankruptcy is filed until December 31st (Post). 

If there is an amount owing to Canada Revenue Agency (CRA) in the pre-bankruptcy period the debt will be included in your bankruptcy. If there is an amount owing in the post filing period, you will be responsible to pay that amount to CRA. If there is a refund in either the pre or the post return, the refund will be sent to the Trustee and the monies will form part of the bankruptcy for the creditors.

 

Henry M. Francheville, CA, CIRP, Licensed Insolvency Trustee

Licensed Insolvency Trustees
Tel: 1-888-455-6060
www.freshstartatlantic.ca
Fresh start…the road to financial freedom

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