Do you feel your debt problems are insurmountable?
The expertise of a financial turnaround consultant can enlighten you and suggest solutions for your debt. Among the debt consolidation and the consumer proposalIn Quebec, you also have the option of declaring personal bankruptcy. Faced with this often difficult decision, a trustee in bankruptcy can help you to when to go bankrupt.
Before venturing into uncharted waters, it's important to know what you're getting into. consequences of personal bankruptcy in Québec. This will enable you to weigh up your options and make the choice best suited to your financial situation.
What exactly is personal bankruptcy in Quebec?
First and foremost, the personal bankruptcy in Quebec is a right you exercise to defend yourself against your creditors. It's a way to get out of debt and stop creditor harassment.
Be careful! Some debts are not considered dischargeable, such as debts related to :
- Maintenance payments
- Fines and fines
- Fraudulent debts
- Compensation for bodily injury caused intentionally
- Alimony debts or obligations
- Dividends to which a creditor would have been entitled had he not been notified of the bankruptcy
- Student debts (if financial problems are reported within 7 years of completion of studies)
Your licensed insolvency trustee will be able to help you on all debts that are dischargeable, and non-dischargeable, at the stage of declaring your personal bankruptcy in Quebec.
Under what conditions can I declare personal bankruptcy in Quebec?
The minimum required by the Bankruptcy and Insolvency Act is to have at least minimum 1000 $ of debt and to be a person considered insolvent.
A financial advisor can easily guide you through the process of declaring personal bankruptcy in Quebec. Here are some of the advantages and disadvantages of declaring bankruptcy.
Can I declare personal bankruptcy in Quebec if I don't have a job?
Yes. Most of the time, they are unemployed people who find themselves over-indebted and unable to support themselves in addition to their payments. It's worth noting that even if you declare personal bankruptcy in Quebec and are unemployed, you may still be required to make monthly payments.
Can my creditors refuse to allow me to declare bankruptcy?
Only the Court has the right to refuse a declaration of financial decline in Quebec, and then only under extremely rare conditions. Your creditors have no power to prevent you from exercising this right. When you declare your insolvency in Quebec, your creditors must stop all legal proceedings against you and can no longer contact you directly. They must deal with your trustee.
What happens to my student debt after I declare personal bankruptcy in Quebec?
If you declare personal bankruptcy in Quebec 7 years after the end of your studies, your student debt may be dischargeable. If you ceased to be a student at least 5 years agoyou can apply to the court to have your debt cancelled. The court will be the judge your good faith and inability to repay before rendering its verdict.
What happens to my inheritance in the event of financial decline in Quebec?
With certain exceptions, your share of an inheritance may be seized in the event of personal insolvency in Quebec.
Can my RRSPs or retirement pension be seized?
No. Retirement pensions are not subject to seizure. only RRSP contributions made within the last 12 months preceding your personal bankruptcy in Quebec are seizable.
What will happen to my family allowance?
These are untouchable, both provincially and federally. Even if you declare personal bankruptcy in Quebec, you will continue to receive these benefits in full.
Will my endorser have to repay my debt if I declare personal bankruptcy in Quebec?
Yes. Your personal bankruptcy only releases you from your commitments. If you have an endorser, he or she will be forced to pay the debt for you.
Am I responsible for my spouse's debts if he or she declares personal bankruptcy in Quebec?
No. Rest assured, you won't have to follow him into his financial problems. Marriage or de facto union does not commit you to becoming your spouse's endorser, and the only debts you'll be responsible for are those for which you are jointly liable. Unless the majority of debts are joint, you do not have to declare bankruptcy and you are not liable for your spouse's debts.
How long does bankruptcy last in Quebec?
If this is your first declaration of personal bankruptcy in Quebec, you may be eligible for release after 9 or 21 months if your income exceeds a reasonable standard of living. After a second personal bankruptcy in Quebec, the minimum period will be 24 to 36 months.
Certain exceptions make discharge from insolvency impossible. For example, if you are an individual who has accumulated more than 200,000 $ in tax debts, and these debts represent more than 75 % of your indebtedness, you will be refused a discharge. The authorized insolvency trustee could submit an application to the Court, but it's important to know that obligations as an administrator are not included in the 200,000 $ calculation.
As for your credit rating, the delay depends on the agency you deal with. As a general rule, in the event of personal bankruptcy in Quebec, the credit rating will be affected for 6 years after the first bankruptcy, and 14 after the second.
You have the right to a second chance
When you declare financial default in Quebec, most of your debts are forgiven. This is an opportunity for you to put your past behind you and develop discipline when it comes to your finances.
Personal bankruptcy in Quebec offers you the opportunity to starting from scratch and avoid repeating the financial mistakes that led you to declare insolvency in the first place.
The work of the bankruptcy trustee is to help you develop a turnaround plan to get you on the road to financial stability. This is a vital support in a situation of intense stress such as bankruptcy. This professional guides you every step of the way, so you can take control of your future.
Remember, personal bankruptcy in Quebec is a solution of last resort, so you can't afford to go bankrupt. use it only if you have exhausted all possible solutions to settle your debt! While you may be entitled to a second chance with this one, certain consequences are not to be overlooked.
Some of your assets will be seized
This seizure of your assets enables you to repay part of the sum owed to your creditors. If you have luxurious possessions, these are likely to be part of the confiscated lot.
Will my car be seized if I declare personal bankruptcy in Quebec?
Yes and no, it depends on several factors if the property is not rented. If the vehicle is not yours, your creditors cannot seize it for repayment. On the other hand, if your vehicle is leased, the leasing company may take it back if you default on payment.
In the event that your vehicle is subject to a secured loan, it will depend on you, the amount owed and the value of the vehicle. In some situations, it may be more advantageous to continue making payments, sell the car, or simply hand it over to your creditors to discharge the debt.
If the car is fully paid for, you may be able to keep it under certain conditions.
Are there assets that cannot be seized in the event of financial collapse in Quebec?
The seizure of your assets does not involve all your assets. You can preserve some of your assets even if you declare personal bankruptcy in Quebec. Here is a list of goods you can keep:
- Your clothes ;
- Your disability benefits ;
- Your alimony payments ;
- Your work tools ;
- Your furniture.
Does declaring personal bankruptcy in Quebec stop the seizure?
On the spot. As soon as a personal bankruptcy is declared in Quebec, all legal proceedings are suspended except those initiated by secured creditors. For example, if your mortgagees have begun proceedings to repossess your home, their rights are limited to repossessing it.
Under no circumstances will they be able to file another lawsuit against you for additional money. When you declare a financial collapse in Quebec, your creditors can no longer interact with you and must contact the trustee for further proceedings.
Another exception to the personal bankruptcy in Quebec lies in the seizure of support paymentsIf a creditor has obtained special permission from the court.
You'll have commitments to fulfill
You'll need to familiarize yourself with Bankruptcy and Insolvency Actto get all the information you need for your application. A Certified Insolvency Trustee (CIC) will guide you through the entire personal bankruptcy process in Quebec.
What is a licensed insolvency trustee and what is his role?
The authorized insolvency trustee is the professional who will explain all the stages of personal bankruptcy in Quebec, its duration and consequences. He or she will also represent you before your creditors to ensure that your bankruptcy proceeds smoothly.
What should I tell my authorized insolvency trustee when declaring insolvency in Quebec?
For the best advice, you'll have to be transparent with your trustee in bankruptcy. You'll have to give him or her a complete picture of your current financial situation:
- The amount of your debts ;
- The assets you own ;
- All changes of address or income.
In short, you need to find a bankruptcy trustee with integrity who will give you the confidence to share your information with him or her in complete security. Communication is key to keeping you up to date on the progress of your case.
You'll find it harder to access credit
Obviously, you won't have access to credit as long as you're in financial difficulty. A first personal bankruptcy in Quebec means that it will appear in your file to the next 6 yearswhile a second, 14 years old.
Once this period is over, it will be possible to benefit from credit. However, it may be difficult to obtain the support of a banking institution after a personal bankruptcy in Quebec. You can turn to lenders. However, you'll need to be extra cautious, and make sure they're honest.
What will happen to my credit rating after a personal bankruptcy in Quebec?
Your credit rating will inevitably fall and you'll end up with an R-9 rating, which is the lowest possible credit rating. This rating will follow you for the six years following your release. However, it is possible to rebuild credit after insolvency.
What happens if I make purchases on my credit card and declare bankruptcy?
It depends on the type of purchase. For example, if the purchases were made on your card, regardless of your financial situation, there will be no negative impact on your personal bankruptcy in Quebec.
On the other hand, if you make purchases that are considered unjustified, your application for discharge of debt may be rejected using these purchases as grounds for objection. The Bankruptcy and Insolvency Act also serves to counter those who commit abuse and fraud. If you are aware that you are going to have to declare personal bankruptcy in Quebec, avoid overcharging your credit card unnecessarily.
In the event of personal bankruptcy, can I keep one or more credit cards?
No. If you declare insolvency, you are no longer eligible for credit. Whether your balance is 0 or 1,000 $, you'll have to hand over your credit cards to your trustee.
For more information on financial problems in Quebec or if you would like to be accompanied by an honest and professional trustee in bankruptcy, please do not hesitate to contact N. Séguin Inc. at 1 855 768-2002.
