What do You keep in Bankruptcy?

When you file for bankruptcy you surrender your possessions or assets to the trustee.  The trustee then sells the items and distributes the funds to the people you owe money to, the creditors.

Many assets are exempt from seizure meaning that you are legally able to keep them in a bankruptcy.

Assets exempt in bankruptcy:

• personal clothing and effects
• household furniture
• tools of your trade,
• farm equipment, supplies and livestock, up to $29,100
• pensions, for more info on RRSP’s and Pensions see below,
• cars up to a value of $6,600
• leased vehicles where you have kept up the payments
• secured vehicle where payments are being made

Bankruptcy is not meant to knock people down or be punitive. The role of bankruptcy is to help honest debtor’s get out of debt and give you a fresh start financially.

★★★★★ Although it was the last thing we wanted to do, YanchDey made this process very smooth, they did all the paperwork and dealt with our creditors.  The garnishee was stopped and we can sleep at night, we now have a fresh start. Many thanks, Debbie S. Ajax

Many people owning homes have created equity that can be affected in bankruptcy. Your options are:

• keep the home
• sell the home
• consider a consumer proposal
• consider refinancing the property

Where you own a home and the equity is less than ten thousand (10,000) the home will not be affected, nor does it become part of your bankruptcy.

Where there is equity in excess of ten thousand (10,000) this amount must be taken into consideration by the bankruptcy trustee. To find out if your home has equity, call and speak to with one of our trustees today.

When considering bankruptcy and there is equity in the home many people consider a consumer proposal instead of bankruptcy.  By considering a consumer proposal you usually can pay up to seventy (70) percent less on unsecured debt without losing any assets like your home in the process.

Where there is no equity in the home and the payments are more than you can afford you may want to consider bankruptcy.

The home would be sold as part of the bankruptcy and where there is a balance owing on the mortgage this would be considered unsecured debt and would be wiped out by the bankruptcy.

Or, if you have sold your home or it has gone to a power of sale, any deficiency owing would be wiped out by a bankruptcy.

Where you have a home and have financial issues you should contact our office where we can discuss your options and find a solution that is best for you.  There is no fee to speak with our insolvency trustees.

Call us today at 905-427-6647.

Registered Retirement Savings Plans (RRSP) are exempt from bankruptcy in Canada, except for any contributions made within the previous twelve (12) months.

Registered Pension Plans are governed by the Ontario Pension Benefits Act and together with all registered pensions are exempt from bankruptcy.

This includes:

• Government sponsored pension plans
• Company sponsored pension plans

In these plans the assets of the bankrupt are exempt from seizure.

This includes spousal RRSP’s, and Registered Retirement Income Funds (RRIF’s).

Any assets not exempt from seizure in a bankruptcy can be purchased back from the trustee at fair market value.  To find out if you have any non-exempt assets contact us today at no cost to you.