The Bankruptcy and Insolvency Act (“BIA”) is the federal legislation that governs insolvency filings in Canada. There is nothing in the BIA that prevents an individual from filing bankruptcy any number of times. As long as you owe more than $1,000 and are insolvent, you can file an assignment in bankruptcy. To balance the rights of a debtor to be relieved from their debts with [...]
To the surprise of many, it is not a requirement for you to be in arrears on your debt payments to file an assignment in bankruptcy or a consumer proposal. It is also not necessary for your debt to have been sent to a collection agency. Many people who file a bankruptcy are making their regular monthly payments on time and may have a decent [...]
Based on the number of inquiries I have received recently, the Canada Revenue Agency (“CRA”) is getting more aggressive in their collection proceedings. The CRA has the right to freeze and seize bank account funds, garnish income and send third-party demands to recover their debt. If you owe money to the CRA for personal income tax, CERB, HST or source deductions that you are struggling [...]
Pre-pandemic Consultations Pre-pandemic, a Licensed Insolvency Trustee (“LIT”) was required to see all debtors in person prior to them filing a bankruptcy or proposal. The LIT had to perform an in-person assessment of the debtor’s financial situation and discuss the merits and consequences of possible solutions, the rights and responsibilities of the debtor, surplus income requirements, discharge, etc. Post-pandemic Consultations When COVID hit, the Office [...]
Filing an assignment in bankruptcy legally stays (stops) your unsecured creditors from pursuing you for collection until your trustee is discharged. Your discharge from bankruptcy relieves you from your responsibility to pay your unsecured creditors (other than those that survive a bankruptcy like support, alimony, fraud, etc.). Surprisingly, some people take the hard step of filing a bankruptcy and then don’t complete their statutory duties [...]
The purpose of filing an assignment in bankruptcy or consumer proposal is to provide you relief from your overwhelming debt. On filing statutory documents, a stay of proceedings kicks in that stops unsecured creditors from continuing any action to collect their debt. A garnishment of wages will stop and collection calls will cease. On completing your bankruptcy or proposal, you are then relieved from [...]
It is recommended that you check your credit report at least once a year for accuracy and to identify any fraudulent activity. There are two major credit reporting agencies in Ontario – Equifax Canada and Trans Union Canada. Checking one agency and then following up with the other after six months will enable you to detect any fraudulent activity more quickly. You can obtain a [...]
If you have finally taken the very difficult step of acknowledging that you cannot handle your debt on your own, your first step should be to reach out to a Licensed Insolvency Trustee. There is no need to see or pay a debt consultant first – contact a trustee directly. The trustees at Taylor Leibow Inc. can be reached by telephone, email or the chat [...]
The Office of the Superintendent of Bankruptcy reported a 58.3% increase in Canadian business insolvency filings in the 4th quarter of 2022 (October to December). From the business owners that I have recently met with, the causes of their financial difficulties stem from: Rising interest rates resulting in significantly higher monthly payments on bank loans and operating lines of credit Delays in obtaining product during [...]
We likely all welcomed the lifting of pandemic restrictions and the return to in-person activities in 2022. Unfortunately, along with that return to “normalcy” came decreasing house values, increased interest rates and increased costs of living. Statistics Canada recently reported that Canadian households’ debt-to-income ratio rose by $1.83 in debt for every dollar of household disposable income. On top of the increasing debt level, multiple [...]
