Toronto Bankruptcy: Who Needs to File, Costs Involved, and The Process
If you have found your way to this page, it is probably because you or someone you know who lives in Toronto Ontario Canada is having financial difficulties and may be considering filing for Toronto bankruptcy.
The first thing we would like to tell you is that personal bankruptcy may not be your only option. We have designed the Bankruptcy Toronto web site to provide individuals with information about all of their options. The following section lists and explains them.
Bankruptcy alternatives available to you
Budgeting
Some people just need help with budgeting. It can be as simple as sitting down and summarizing your monthly expenses. While living in Toronto may be a little more expensive than living in other Ontario cities, or anywhere else in Canada, the basics are the same: housing, utilities, groceries, eating out, transportation, entertainment, insurance, and so on. By listing these items and comparing the total to your monthly net take-home pay, you will have taken the first step towards budgeting and taking control of your finances.
Debt Consolidation Loan and Debt Management Plan
Of course, if your debts are overwhelming and budgeting can't help, there are other options to consider - like a debt consolidation loan, or a Debt Management Plan (which would be administered by a credit counselor).
Consumer Proposal
For those people in Toronto who are employed but just don’t have enough extra cash to make all their monthly payments and reduce their debt load, they may want to consider a consumer proposal. That option allows them to work out a repayment plan that they can afford - which may be less than paying back the debt in full. A consumer proposal must be filed with a trustee in bankruptcy. For more information about this option, please visit our consumer proposal information page.
When might Toronto bankruptcy be necessary for you?
If none of the above work, then filing for personal bankruptcy may be the last resort. Many people file for bankruptcy in Toronto due to loss of or reduced employment, marital separation, and sometimes just because of simple credit mismanagement.
The basic concept behind bankruptcy is that you turn all your non-exempt assets over to your trustee in exchange for walking away from your debts. You are allowed to keep your clothes and personal belongings, and even a basic car. You will also have to report your monthly income to your trustee during the period of your bankruptcy. If your take-home pay exceeds the allowable level set by the federal government, then a portion of your income must be paid to your creditors. If all goes well, and if you have never been bankrupt before, your bankruptcy should be over within nine months.
What does it cost to file for bankruptcy in Toronto?
The actual cost of your bankruptcy in Toronto will depend on a number of factors, including whether or not you were bankrupt before, what assets you own (such as RRSPs), and the size of your family.
The payment you make each month depends on your monthly income. The federal government sets limits on what you are allowed to earn each month while you are bankrupt. If you exceed those amounts you will pay extra. These calculations can sometimes be quite complex and it is important that you understand them before you make the decision to file for bankruptcy in Toronto.
What is the next step in filing for bankruptcy in Toronto?
There really is only so much we can explain to you here (you may find the answers to some of your questions at our Bankruptcy Toronto Blog); However, remember that everyone’s situation is a little different from the next person. We encourage you to contact our Toronto bankruptcy office today, to arrange for a free, no obligation consultation. We will look at your specific situation, outline your options and then recommend a plan that’s right for you and your family. The next step is up to you.
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