Filing for personal bankruptcy results in a number of significant consequences. In particular, you may have to give up some of your personal belongings, you will have to fulfill a number of obligations to your Licensed Insolvency Trustee (LIT), you will remain responsible for certain debts that are not cleared by bankruptcy, and your credit rating will be damaged.

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When you are in a situation of financial difficulty, there are many options to consider. For easy-to-understand debt solutions, including bankruptcy, contact an experienced and compassionate agency . Get the help you need to rebuild your financial future. It’s easier than you think.

Will I lose everything if I file for bankruptcy?

Although some of your personal assets and belongings could be sold by your LIT to partially satisfy your debts, usually personal items and household goods are not affected.

Although the procedure for filing for bankruptcy follows Federal guidelines, each province and territory determines the list of assets that are exempt and the limits on the value of each type of exemption.

Under the Ontario Execution Act and the Regulations, you are allowed to keep:

• all personal clothing (no limit)
• household furniture, food, fuel  and equipment in your permanent home (up-to $13,150)
• motor vehicle (up-to $6,600)
• tools necessary to your work (up-to $11,300)
• certain farm property (up-to $29,100)
• home (up-to $10,000)
• most pension plans and life insurance policies, and all RRSPs (except for contributions in the 12 months before the date of bankruptcy)

Also, things owned entirely by your spouse are exempt. However, if you and your spouse own things jointly, you may have to sell the portion that you own. It is a good idea to discuss these issues with your trustee before you file for bankruptcy.

Gifts and transfers of property before filing for bankruptcy

Any gifts or transfers of property that you may have made just prior to filing for bankruptcy need to be divulged to your LIT and can be reversed by the court. Any transfers you made in the year before you filed for bankruptcy (five years for related parties) will need to be reviewed by your LIT.  You will also need to tell your LIT if you made any payments or gave preferential treatment  to any of your creditors in the three months before declaring bankruptcy (12 months for related parties).

Get help

A criminal record will affect your ability to get a loan, a mortgage, or a job. To erase your criminal record, learn more at Pardon Partners. It’s easier than you think.

When you are in a situation of financial difficulty, there are many options to consider before filing for bankruptcy. For easy-to-understand debt solutions on your terms, contact our preferred experts 4Pillars and rebuild your financial future. With 60 locations across Canada, they will help you design a debt repayment plan and guide you with compassionate advice. No judgment. For help, visit 4Pillars or call toll-free 1-844-888-0442 .

								
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