Personal Bankruptcy

Common causes of bankruptcy in Canada

At Phong Su & Associates LIT, we always make it clear to our clients that bankruptcy is a big decision that will affect their credit score for years. Therefore, we always recommend other alternatives to bankruptcy such as consumer proposal and debt consolidation just to name a few. Keep in mind that a bankruptcy filing is a public record hence it is best to stay informed and make a good decision by also considering your financial future.

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How do consumer
proposals work?

Are you constantly dealing with threatening phone calls, interest that continues to pile up and the risk of your wages being garnished? Perhaps filing for personal bankruptcy could be the best solution for you. When you file for bankruptcy, your creditors are no longer allowed to contact you. You get a discharge from your debts within a specified amount of time and no creditors can take legal steps to recover what you owe. Do you qualify to declare personal bankruptcy? Will you lose all your assets? When you come to us, we will help you determine the right path for you based on your circumstances. We offer credit counselling, consumer proposals and personal bankruptcy in Toronto.In many cases, people who file for bankruptcy are no longer able to pay back their debts or seek additional credit. Most people will consider taking this route after the harassing phone calls from debt collectors have become unbearable. Life events like divorce, separation, job loss or long term, severe illnesses can also cause one to file for personal bankruptcy in Canada

How it works

In Toronto, there are certain kinds
of debts that are excluded from bankruptcy.

Secured

Secured debts such as car loans and mortgages

Student loans

Student loans of less than 7 years old

Payday loans

Child support and spousal support payments that are past their due date

Filing bankruptcy in Canada

You will need to work with a licensed trustee like Phong Su & Associates LIT to help you fill the forms, complete the necessary paperwork, and get all the guidance you need throughout the process. The rules regarding how to file and who can declare will vary from province to province. There are also unique circumstances where creditors may stop a person from filing for bankruptcy. For instance, if you recently racked up credit card debt and then you want to declare bankruptcy to avoid your obligations, this filing may not be approved.

How filing for bankruptcy affects your credit

When you successfully declare bankruptcy, the next step is to begin rebuilding your credit. There’s no quick way to fix a poor credit score. With the help of your trustee, you may consider options such as getting a secured credit card, paying small amounts of credit, and avoiding overdrafts. If you think that filing for personal bankruptcy in Toronto could be right for you, we can help. Reach out to us to speak with one of our certified credit counsellors. All information you share remains confidential and we’ll be happy to look at your entire situation and provide a solution that’s realistic for you.

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