Who is a trustee in bankruptcy?
The trustee in bankruptcy is the person who is licensed by the Superintendent of Bankruptcy to administer commercial proposals and bankruptcies.
The trustee represents your creditors as an officer of the court. However, he can provide information and advice about the proposal and bankruptcy procedures and ensure that your rights, as well as those of your creditors, are respected.
What is meant by "insolvent person"?
A person is insolvent when he has debts of $ 1,000 or more and, as applicable, is unable to meet his obligations as they become due, or has ceased to do so, or when all of his property, if sold, would not be sufficient for the payment of his obligations.
What is a co-signer?
Your bankruptcy does not release the cosigner or anyone who has guaranteed your loan, if a parent co-signed your loan, the parent is responsible to repay the loan in full even if you decide to go bankrupt.
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What is the duration of a bankruptcy?
A person who goes bankrupt for the first time and who has fulfilled all the obligations prescribed by law, will be released from his debts automatically after nine (9) months and one (1) day after the date of bankruptcy. The trustee will send him a discharge certificate, attesting that the bankrupt is discharged from all debts except those covered by Article 178 of the Act (non-dischargeable debts).
However, if the trustee, a creditor or the Superintendent of Bankruptcy opposes to the automatic discharge, or in the case of a person who has been bankrupt in the past, the trustee shall, within one year following the date of bankruptcy, ask the court to decide on the discharge.
The court may refuse discharge, suspend the discharge for a period it deems appropriate or grant a conditional discharge.
Non-dischargeable debts through bankruptcy (art. 178 BIA).
The law provides that certain types of debts will continue to be payable after your discharge. To name a few:
- Child support and its arrears
- Debts resulting from fraud or a breach of confidence
- Debts arising from criminal and penal proceedings (fines or tickets)
- Student debt under certain conditions
What is the cost of a bankruptcy?
There is a registration fee to be paid to the Superintendent of Bankruptcy and the trustee fees that are prescribed in the rules of bankruptcy and insolvency.
Costs may vary from case to case and it is possible to make a joint bankruptcy. The trustee fixes the amount that the bankrupt will pay each month according to the norms prescribed by the Act.
The trustee determines the net monthly income of the bankrupt, taking into account family responsibility charges.
How to restore one's credit?
To improve your credit rating after getting your discharge, you can, for example, contact your banker and make an appointment and have your paychecks at hand, details on your budget and your discharge documents and ask the banker on how you can regain a good credit rating. You can also notify the credit bureaus when you are released of your problem.
What is a credit rating?
Credit bureaus collect information about the financial affairs of consumers and sell them to their customers, such as credit providers, employers and insurance companies. These credit bureaus get the information from different sources.
Please note that your credit rating is established by your creditors. The credit bureaus only transmit this information to their clients.
Generally, information about your bankruptcy may appear on your record for a period of six (6) to seven (7) years after your discharge.
If you have been bankrupt before, this period may be extended up to fourteen (14) years. This period may vary from one individual to another.
Credit bureau files contain the account number, the unpaid balance and a rating scale of nine points indicating for example R1 corresponding to a payment made on time and R9 which corresponds to a bad debt or on collection claim (this also applies to bankruptcy).