what do I get to keep if I go bankrupt « Bankruptcy Ontario: Free Information about Bankruptcy in Ontario

bankruptcy and spouse’s house

Saturday, July 24th, 2010

Question: I don’t not have my name on my husbands mortgage. I came into our marriage with debt. We where married in Nov. 2009. If I claim bankruptcy will he be affected and will he lose his house?I only own a old van for work will I lose that?

Answer: No, if the house is owned by your husband, and he has always owned the house, than your bankruptcy does not impact on his house. More information can be found in this article on how bankruptcy affects your spouse.

In Ontario you are permitted to keep one motor vehicle worth up to $5,650, so if your van is old, and has no loans against, you would be permitted to keep it.

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Keeping Cash & Assets during bankruptcy

Thursday, June 3rd, 2010

Question: Does any kind of cash coming in anywhere from selling something to babysitting have to go to the trustee?

Answer: No, not always. When you file for bankruptcy, you’ll be required to report your income and expenses to the trustee each month. This income should include all sources of income earned during the bankruptcy period.

The payments that you’ll be required to make to the trustee are dependent on the size of your family and the income you receive. Essentially the rule is “the more you make, the more you have to pay”. A useful guideline to these rules – called Surplus Income -can be found here.

Before you file for a bankruptcy, the trustee will inform you what assets you’re allowed to keep and which ones may vest with the trustee. You can find more information about the assets you’re allowed to keep here.

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Car Loan Situation

Sunday, May 2nd, 2010

Question: I got a loan for a car of $33K in 2008. As a right now I owe $22K. I had change one of the seat of car because when i left my dog inside the car he distroided and I replaced the car seat with an older one and also I put a remote started that I took out and put it in my other car like 4 month ago… I dont know if this is going to affect me in anyway if I declare bankruptcy? Any advice in this situation and also I’m looking for a lawyer to represent me

Answer: If you file for bankruptcy and your intention is to keep the car, you’ll most likely be able to do so as long as your account is up to date and you and the car loan company agree that you’ll continue making the payments to them. You’d only include the car loan debt into the bankruptcy if you volunatrily wanted to surrender the vehcile back to that creditor and cease paying them.

For more information on how the bankruptcy process works, our advice would be to contact a local trustee in bankruptcy who’d be happy to explain your options to you in more detail.

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Vehicles in bankruptcy in Ontario

Wednesday, August 12th, 2009

Question: My wife and I are looking at the possibility of filing for bankruptcy. We live in a rural area with two children. Currently my wife drives an older car and I use an 11 year old motorcycle to get to work. Neither have loans or leans against them. Would we be able to keep both vehicles?

Answer: The rule in Ontario is each person who goes bankrupt is permitted to keep one motor vehicle, if there are no liens or loans against it, worth up to $5,650. So, if your wife owns the car and you own the motorcycle, and each are worth less than $5,650, then yes, you could keep both vehicles in a bankruptcy.

However, if you (or your wife) own both vehicles, then only one vehicle is exempt.

Your Ontario bankruptcy trustee can provide more information.

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Home equity or no equity

Saturday, August 8th, 2009

Question: What happens when you have 3 mortgages on your property and your property value is of a lower amount then the combined mortgages and you file for bankruptcy in Ontario? What do you think the trustee’s stand point will be?

Answer: Part of the trustee’s job is to turn your assets into cash for the creditors. If your property has negative equity, the trustee will not seize the house, because they can not turn it into cash. Assuming the three mortgage lenders agree, you could keep the house if you go bankrupt.

Practically, it may make more sense to surrender the house to the mortgage holders before you go bankrupt. By doing so any shortfall when the house is sold will be included in your bankruptcy. In most cases it is not prudent to go bankrupt and still have a huge amount of mortgage debt that will be difficult to repay. Your trustee can provide you with more information.

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My Car and bankruptcy in Ontario

Friday, August 7th, 2009

Question: I have a car that is worth more than 5650. If I file for bankruptcy in Ontario, Since it is my only vehicle, would I be able to keep it and pay the difference via my monthly payments to the trustee? eg / the car is worth 8000 and I am allowed 5650. So I would pay an additional 2340(8000-5650) over the 9-21 months.

Answer: Yes, you can make arrangements with your trustee to pay the non-exempt portion of your vehicle over the period of the bankruptcy so that you can keep your vehicle.

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RRSP and Bankkrupsy

Wednesday, August 5th, 2009

Question: What happens to my RRSP after filing for bankruptsy?

Answer: If you go bankrupt anywhere in Canada, you are allowed to keep your RRSP, except for any contributions you made to it in the last 12 months. For example, if you have been contributing $100 per month to your RRSP for the last 36 months and it now has $3,600 in it, you would lose $1,200 of your RRSP when you file for bankruptcy.

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keeping our house if we go bankrupt in Ontario

Sunday, June 7th, 2009

Question: I was recently married,we bought a house together about a year ago before we got married ,she bought a truck for me about 2 years ago,i recently found out that she owed a lot of money on it and the payments are way behind,along with a few other debts,…what id like to know is with her name on the title of the house ,is it possible for her to claim bankrupcy and for me to beable to keep the house,…i can handle all the debts of the house and bills,but with this all added on theres no way i could afford it,…they are also threatining to reposses the vehicle,…all we care about is our home,…thanks

Answer: Whether or not you can keep your house if you go bankrupt depends on the value of the house, and the amount owing on the mortgage. Here is an article that answers the question: What Happens To My House If I File Bankruptcy?

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Joint Car loan and bankruptcy

Tuesday, May 5th, 2009

Question: I have a joint car loan (with a bank) with my ex-husband. He has taken over paying the monthly payment until he can take over the loan, but if i claim bankruptcy what will happen to the car loan? Will he be able to continue to make the monthly payment or will this loan become defaulted?

Thank you.

Answer: In most cases he will be allowed to continue making the payments on the car loan. One option would be for him to contact the bank now, before you go bankrupt, and ask to have your name taken off the loan. If the loan is entirely in his name, there should be no issues.

If the bank won’t remove your name, your husband should discuss it with the bank first, and ask them to confirm that he won’t lose the vehicle if you go bankrupt.

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Can I keep my motorcycle if I go bankrupt in Ontario?

Thursday, March 19th, 2009

Question: If I have a car worth $800.00 and motorcycle worth $6,500.00 with no liens against them, will they try or can they take the motorcycle – or would I have to pay the difference of total value $7,300 – $5,650.00?

Please let me know

Answer: If you file bankruptcy in Ontario, you are permitted to keep one motor vehicle worth up to $5,650. So yes, in your case you would be required to pay the difference, $7,300 – $5,650 or $1,650 if you wanted to keep both vehicles.

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