There’s no doubt that making the decision to file for bankruptcy is a difficult one. The most common misconception is that when you file for bankruptcy, you will lose everything. Many individuals fear losing their home, their car and their retirement savings. This fear can prevent them from seeking help for their debt troubles, only to have those troubles continue to get worse.
The reality is that both provincial and federal legislation set clear rules about which assets the Trustee is able to seize for the benefit of your creditors and which assets you are allowed to keep. In many cases the Trustee is not able to seize your assets and often there are ways for you to keep your home, your car and even your retirement savings.
In general, if your car is financed, your house is fully mortgaged and you have not made any contributions to your RSP accounts in the last twelve months, the Trustee would not have an interest in those assets. Even if you have equity in your home or have been making regular contributions to your RSP account, there are still arrangements that can be made for you to keep these assets, depending on your overall financial situation. If you are still concerned about your assets, another option is filing a consumer proposal. Although you must still disclose your assets and their value will be considered when designing a consumer proposal to your creditors, they cannot be seized. In other words, the assets would not be liquidated unless you choose to make them a part of your consumer proposal.
If you are having financial troubles, MNP can provide a free consultation to discuss your options and address any concerns you have about your specific situation. To find out more about how MNP can help with your debt troubles, contact our office to book a free confidential consultation today.
