Ontario Personal Bankruptcy Blog: Experts Answer Personal Bankruptcy Questions

Ontario Personal Bankruptcy Blog provides free personal bankruptcy information and helps Ontario residents dealing with their debt.

Below are the most recent personal bankruptcy questions. Be sure to check out our Frequently Asked Questions page for answers to more common questions about personal bankruptcy in Ontario. Remember, you can always post an anonymous question, as well as arrange for a free consultation with a personal bankruptcy expert near you.

Recent Bankruptcy Questions:

Posted on Friday, February 05, 2010

bankruptcy and cra

Question: in a bankruptcy, if there are only 2 creditors to be satisfied, one being CRA and the other party is a 'common-law' spouse, is it possible that CRA will not agree to the payout it will receive as set out by the bankruptcy trustee. That is, is it possible that CRA will ask for more money?

Answer: Any creditor can oppose your discharge from bankruptcy, and then attend a hearing in front of the bankruptcy judge to request that you make additional payments. They would have to have a good reason for making that request. Your bankruptcy trustee can explain in more detail whether or not that is likely to happen in your case.

Labels: bankruptcy, bankruptcy discharge

Posted on Wednesday, February 03, 2010

2nd Bankruptcy

Question: I had a bankruptcy back in 1999 in another province that has been fully discharged and is off my credit bureau. If I go bankrupt again, will the first bankrupt still show, or can I claim under the rules of first bankrupt now?

Thank you

Answer: Yes, the first bankruptcy will still show. All bankruptcy trustees in Canada are required to search the database before filing a bankruptcy, and the database is Canada-wide, and includes all bankruptcies since 1973. So regardless of which province you filed in, the first bankruptcy will show, and you will be subject to the rules for a second bankruptcy.

Labels: bankruptcy

Posted on Tuesday, February 02, 2010

How Long until bank reposses the house?

Question: I currently reside in my girlfriends home, she declared bankruptcy Jan 1/10 how long do I have to get out of the house before the bank repossess it? I don't want to loose any of my belongings?

Answer: It depends on how far in arrears she is on her mortgage payments. Banks generally begin foreclosure proceedings when you are at least three months in arrears, but it can often take longer than that before they are in possession of the house.

If you are certain that the bank will be taking the house, the best solution is to find a place to rent now and move, so that you are not waiting until the last minute to find a place to live.

Labels: bankruptcy, house

Posted on Monday, February 01, 2010

will claming bankruptcy in Ontario affect our house?

Question: I am out of work waiting for ei. My bills are getting to much to pay i owe about $6,000 credit card and loan. Me and my wife are separated and she is making the mortgage payments on the house but its still in both are names. How will this affect my chances for bankruptcy in Ontario and how will this affect her?

Answer: The answer depends on the value of your house, and the amount owing on the mortgage.

The difference between what the house is worth, and what's owing on it (the mortgage) is your equity. Since you and your ex-wife jointly own the house, you are each entitled to half of the equity. If you go bankrupt, you are required to give the trustee your share of the equity. If your share of the equity is a small number, it's probably not an issue. If it's a big number, the only solution may be to sell the house.

The first step is to get an appraisal done on the house by a local real estate agent, and get confirmation from the bank as to the amount owing on the mortgage. An Ontario bankruptcy trustee can then provide you with more detailed information.

Another good source of information is this article on What Happens to My House if I go Bankrupt?

Labels: bankruptcy Ontario, house

Posted on Saturday, January 30, 2010

consumer proposals and credit ranking

Question: If I do consumer proposal with my credit cards, what does it do to my credit ranking? and for how long?

Answer: According to Equifax, a consumer proposal remains on your credit report for three years after all of the payments are made, and you would be coded as an R7 (a bankruptcy is an R9).

Labels: consumer proposal

Posted on Friday, January 29, 2010

After filing for Bankruptcy and Win the Lottery

Question: What happens if you win a lottery after you've filed and been discharged from personal bankruptcy? Didn't seem to find this question on your Bankruptcy Ontario FAQ section.

Answer: If you win the lottery while you are bankrupt (before you are discharged), the trustee will seize the lottery winnings and distribute the money to your creditors. If you win more than you owe, the trustee would return the difference to you, since all your creditors would have been paid in full.

If you win the lottery after you have been discharged from bankruptcy, the money is yours to keep.

Labels: bankruptcy discharge, bankruptcy Ontario

Posted on Thursday, January 28, 2010

second time undischarged

Question: I lost my job in aug 2009 after 15 years. I now make 9.75 an hour,I am not discharged from a feb 2007 bankruptcy and am due to pay about 3000.00, I have a evcition from my landlord and don't want to relocate my family the only money I have is in a locked in rrsp,I AM APPLYING FOR FINANCIAL HARDSHIP FOR LOW INCOME AND EVICITION this will take time, there will be about 7000.00 left over if aproved after my rent is paid based on my 2010 income that I would like to ask for to help for rent for 2010 . can I use some of this money to pay my trustee so I can get discharged, and the balance for rent to come in 2010.

Answer: Perhaps. This is a complicated area, so you should discuss it with your trustee.

If you filed bankruptcy in February 2007 you have probably already had a discharge hearing, where the Bankruptcy Judge determined what was required for you to finish your bankruptcy. It would appear that the judge decided that you are required to pay $3,000. It is therefore possible that you can unlock your LIRA and use the money to pay the trustee.

However, you want to discuss this with the trustee first, since you do not want the trustee to attempt to seize all of the money when it is unlocked.

Again, without more specific knowledge of your case, it is impossible to give a more specific answer.

Labels: bankruptcy discharge