2025-06-25
How to budget for inflation
The cost of daily goods has been rising over the past few years — increasing the price of food, gas, clothing, and many other essential items that Canadians need in their day-to-day lives.
2015-09-08
Author: Leah Drewcock
Navigating through the ins and outs of debt solutions when you are in financial distress can be overwhelming. The stress of harassing phone calls from creditors or collection agencies certainly doesn’t help.
Often, filing a Consumer Proposal allows individuals to retain their non-exempt assets by making monthly payments over a longer period of time (up to a maximum of five years). Sometimes however, bankruptcy is the best option for achieving financial relief.
What is a bankruptcy?
Bankruptcy in Canada essentially means that you assign or surrender everything you own to a trustee in bankruptcy in exchange for the elimination of your debts. Through bankruptcy, an individual overwhelmingly burdened with debt gets a chance to start fresh.
To go into bankruptcy in Canada, a person must live or do business in Canada, and must be insolvent. To be insolvent means:
1. To owe at least $1,000.
2. Not to be able to meet your debts as they are due to be paid.
Bankruptcy Trustees are federally licensed. Their fees are regulated and moderate, so the cost of bankruptcy is reasonable. Because bankruptcy is a legal process, there is a “stay of proceedings” that prevents a garnishment or any legal action from happening, and stops your creditors from calling. You may be entitled to an automatic discharge from personal bankruptcy in 9 months, the minimum time set by the Court to be bankrupt, provided you have never been bankrupt before and you complete various duties and responsibilities. Your ability to obtain credit in the future could be affected, since bankruptcy will remain on your credit report for several years.
In bankruptcy the Trustee’s fee is governed by legislation. The trustee normally is paid out of the funds arising from the liquidation of the bankrupt's assets. If the bankrupt individual has no assets available, the trustee will tailor the fee arrangements to the individual’s situation. In the majority of cases the cost is approximately $200 a month for each of the 9 months.
If you have ‘surplus’ income, according to Low Income Cut-Offs, you may be required to pay a portion of your income into the bankruptcy, for the benefit of your creditors.
How long will I be in bankruptcy?
Bankruptcy Discharge Rules:
With the help of your local MNP Ltd. trustee, your debt situation can be managed. Every year, we help thousands of Canadians find trusted solutions for their financial problems, and we can help you too.To learn more about how long you would be in bankruptcy please you please visit www.mnpdebt.ca or call toll free 310-DEBT.
Leah Drewcock is a Bankruptcy Trustee within our Prince George location. To learn more how MNP Debt can help you, contact our local office at 250.596.4901
2025-06-25
The cost of daily goods has been rising over the past few years — increasing the price of food, gas, clothing, and many other essential items that Canadians need in their day-to-day lives.
2025-06-19
With the school year beginning and thousands of Canadian students beginning a new semester of post-secondary studies, all those hard-earned dollars from summer gigs are now being applied to tuition, books, transportation, housing, and supplies.
2025-06-16
Bankruptcy Alternatives to Bankruptcy
Let’s review what a Consumer Proposal is, as well as the pros and cons of filing a Proposal, to help you determine if it’s the right solution for your unique situation.