If you have decided it’s time to throw in the towel by declaring bankruptcy, one way to make the process less stressful than it already is would be to educate yourself on your role in filing for bankruptcy. When you declare bankruptcy, you have set duties and responsibilities you must comply with in order to not commit any offenses under the Bankruptcy and Insolvency Act. If you commit an offense, you could not only face a hefty fine, but also imprisonment for upwards of five (5) years.
Start by handing over your assets to your bankruptcy trustee. You will also have to hand over all credit cards issued to you for cancellation. Your Trustee will also need to obtain all of the records relating to your affairs.
Compile a formal list of your liabilities and assets, which should include the names of your creditors, addresses, account numbers and debt amounts. You should also note any of your assets you have sold in the year leading up to your bankruptcy declaration, and any assets you have obtained as a gift in the last five year prior. Your Trustee will need the necessary information to file income tax returns, as well as a monthly income and expense statement. You are also required to report inheritances or lottery winnings to your Trustee.
Your Trustee will begin arranging meetings with your creditors, and you will be required to attend if you are called upon. You will also need to attend at least two counseling sessions, which are set up by your Trustee. If you have a change in address or telephone number during the time of your bankruptcy filing, you are required to inform your Trustee immediately.
While it all seems like an incredibly stressful process, you have to keep your head together. If you miss anything, make any mistakes or purposely leave something out of your bankruptcy claim, you can be convicted with a fine or jail time.
You are at risk of conviction if you fail to follow any and all of the requirements previously mentioned, as well as falsifying statements, hiding or destroying property / records, obtaining any kind of credit over $1000 in the time of your bankruptcy, falsely obtaining credit, engaging in any sort of trade or business without full disclosure to your Trustee, and refusing to answer questions truthfully during an examination under oath. These offenses carry fines and/or jail time, depending on their severity. Your Trustee is there to guide you through the process, so if you feel confused or overwhelmed; it always helps to just ask questions.
If you are considering filing for bankruptcy or would like to know some of your other bankruptcy alternatives, feel free to contact one of our four offices located in Toronto, Barrie, Collingwood and Owen Sound.