The decision to file for bankruptcy is a difficult one for most honest debtors to make. But the actual process and steps to file bankruptcy are not as difficult as you might think.
If you’re considering bankruptcy as a way to get debt relief, these four easy personal bankruptcy steps will help you get started on the path to the fresh start you deserve.
Step #1: Decide to get help.
First and foremost, you need to acknowledge that you have mounting debt that you can’t get out from under without some assistance. There are signs to look out for, such as:
- Missing monthly mortgage or loan payments.
- Consistently hitting the limit on your credit card(s).
- Using credit card cash advances or payday loans to pay bills.
- Getting calls from collection agencies.
- Getting your wages garnished.
- Receiving notice of legal action against you to collect on your debts.
It’s never too late to begin to take control of your finances. As soon as you hit one of these signs of trouble, reach out for help.
Step #2: Connect with a Licensed Insolvency Trustee.
In order to declare bankruptcy, you’re required to consult a Licensed Insolvency Trustee. These are the only professionals licensed by the Canadian Superintendent of Bankruptcy to help administer consumer proposals and bankruptcies.
And a trustee does a lot more than just help you file for bankruptcy. A trustee will evaluate your financial situation and give you advice on all the possible solutions to your financial problems. These can include assistance with consumer proposals, debt consolidation, and money management strategies.
When choosing a trustee, try to pick one that’s located close by to you, since you’ll be attending at his or her office throughout the process. You should also confirm that they are indeed licensed trustees on the Government of Canada’s website.
Step #3: Meet with your trustee and review your options.
The initial consultation with your trustee is free. This is a good opportunity for you to confirm that the trustee is a good match for you. You should feel comfortable asking any questions you may have, and be certain that you understand all the responses you’re given. If you’re not, go back to Step #2 and start again.
During this first meeting, the trustee will review your financial situation with you. Prepare yourself and bring along documentation regarding your income, expenses, assets, and debts. You should come away from this session understanding all options available to you in your circumstances. And remember, how you ultimately decide to proceed will be your decision alone.
Step #4: File for bankruptcy.
If you’re ready to file for bankruptcy, your trustee will prepare the initial paperwork, including all required bankruptcy forms, with your assistance. Your trustee will then review it with you and answer any questions you may have, prior to your signing.
Once you sign, your trustee will submit the information electronically to the Office of the Superintendent of Bankruptcy. Your trustee will also send copies of the filing to your creditors, who must stop any collection efforts against you as the bankruptcy has now officially begun.
And that’s how you file for personal bankruptcy in four easy steps.
Keep in mind that after filing, you’ll need to fulfill your obligations while in bankruptcy, including:
- Making monthly payments to your trustee to cover bankruptcy costs;
- Attending credit counseling sessions;
- Providing the information needed so your trustee can file your tax returns; and
- Completing a monthly income statement.
While personal bankruptcy is not a difficult process to file for, it is still a legal process and you’ll need to consult with a trustee. Contact us today for your free initial consultation. Let us help you understand your options and guide you in getting back to good financial health.