Consumer Services

As you may have noticed, there are many different solutions to overindebtedness. It's important to consult a trustee in bankruptcy for an in-depth assessment of your case. That way, you can determine the solution that best suits your needs and financial situation. Many people have financial difficulties, and there's no magic, universal solution that applies to everyone. It all depends on a series of factors and variables that need to be studied by an insolvency expert.

Personal bankruptcy involves the liquidation of a debtor's assets for the benefit of creditors. This is necessary when a person has a large debt and no income to maintain the payment structure of a personal proposal. In some cases, bankruptcy can result in the loss of real estate, jewelry, cars, antiques and other assets. Your bankruptcy may also affect other people financially. For example, if your parents co-signed a car loan for you, they could be held responsible for part of that debt if you ever declare bankruptcy. It's also important to know that bankruptcy damages your credit report. Bankruptcy affects your credit report negatively for a few years and can affect your ability to borrow in the future. If a bankruptcy appears on your credit report, creditors may refuse to grant you credit or decide to offer you higher interest rates and less favorable terms.

A first bankruptcy generally affects your credit rating for 6 to 7 years, while a second bankruptcy stays on your record for 14 years. Fortunately, you can rebuild your credit after bankruptcy, especially if it's your first. In fact, once you've declared bankruptcy, your trustee will give you advice on how to better manage your finances.

The main difference is that in the case of a personal proposal filed and accepted by creditors, assets can be retained. They are therefore protected against seizure. A proposal can be spread over a maximum of 5 years, whereas a first bankruptcy is finalized after 9 months, in most cases.

If this is your first bankruptcy, the process can take between 9 and 21 months. If no one opposes your bankruptcy, your discharge will take place 9 months after the opening of your file. However, if you have surplus income, your discharge will take place 21 months later. If this is your second bankruptcy in Quebec, the process takes a minimum of 24 to 36 months. For a third bankruptcy (or more), a court hearing will be held 12 months after the opening of your file. At this hearing, the duration of the bankruptcy will be established. The duration is generally 12 to 36 months.

The main non-dischargeable debts are:- maintenance arrears;- criminal fines (e.g. traffic tickets);- debts or obligations resulting from fraud, misrepresentation, etc.