What do you get to keep when you file chapter 7 Bankruptcy?

Currently there are two different sets of property exemptions that the law says you can keep. Your attorney will usually choose the most beneficial to you, based on the value and type of property you own.

Both sets of exemptions cover things like, clothing, jewelry, furnishings, automobiles, equipment used in trade or business, etc, in varying amounts, but one of the major differences is in the treatment of equity in your residence.

One set provides that a married couple may have $75,000 in net equity in your home (in some cases $150,000 depending on age and income) after deducting all encumbrances) while the other set doesn't provide specifically for equity in a residence, but provides for a catch all exemption which allows an additional $19,675.00 exemption in anything you choose, whether it is money in the bank, cash in your pocket, equity in real property etc.

You may also legally convert non-exempt property into exempt property prior to filing your case, provided it is done correctly. If not done correctly, it can result in a loss of the property and even denial of your discharge, so you usually need the help of a bankruptcy attorney in making these decisions.

Personal Bankruptcy Videos

If you are looking for information about personal bankruptcy try Google video. There are a couple of good videos from Canadian bankruptcy trustees explaining the bankruptcy process and alternatives to bankruptcy. This is an easy way to learn about bankruptcy and your options.

Personal Bankruptcy in Canada
Alternatives to Personal Bankruptcy

What is Personal Bankruptcy?
Article Provided by Bankruptcy America (www.bankruptcy-america.com)

There are several different types of bankruptcy in United States and understanding all of them is crucial. Typically debtors will choose either chapter 7 or chapter 13 bankruptcy.

In a Chapter 7 bankruptcy, the debtor files a petition with the bankruptcy court serving the area where the debtor lives (or where the business debtor operates the business, or where the debtor has most of their assets). With the petition, the debtor will file: schedules of assets and liabilities, current income and expenditures, executory contracts and unexpired leases, and also, a schedule of exempt assets. Bankruptcy forms can be purchased at a stationery store (they are not available from the court), or an attorney can help you prepare the forms.

Chapter 13 is an alternative to Chapter 7 bankruptcy, and is designed for individuals with regular income who want to pay their debts, but need some time to do so. Under Chapter 13 debtors repay their creditors, either in full or in part, over a period of up to three years. Plans can be made for up to five years with court approval.

The cost of filing for bankruptcy will vary depending on which chapter you choose. Fees are subject to change; however, you can expect that filing will cost approximately $200. You will also need to consider the cost of hiring a bankruptcy attorney.

For more information about Personal Bankruptcy, or to find a licensed bankruptcy attorney please visit: www.bankruptcy-america.com

Challenging the Bankruptcy Stereotype

A great article appeared today in the National Post describing the "The Average Canadian Bankrupt". This article challenges the stereo type that most bankruptcies involve long-term unemployment or a very low income.

How to Choose a bankruptcy trustee

In order to understand how to choose a bankruptcy attorney (or trustee as they’re called in Canada), it’s important to understand the relationship that will exist between you and your trustee.

Firstly, you do not "hire" a trustee to work for you. Even though in most cases you pick the trustee you are going to deal with, the trustee does not work for you. Even though you are making payments to the trustee, the trustee does not work for you. Neither does the trustee work for your creditors. Canadian bankruptcy trustees are appointed by the Court to administer your bankruptcy. Their main job is to ensure that both you and your creditors follow all bankruptcy rules.

A bankruptcy trustee is similar to a referee in a hockey game. At the start of the game the referee will make sure both sides understand the rules. At the start of your bankruptcy your trustee will explain to you the duties and requirements of filing bankruptcy.

If you don't play by the rules just like a referee, your trustee will assign you a penalty. That being said, most trustees appreciate the fact that you are going through a very stressful time and they will deal with you in a compassionate manner. The fact that you went looking for a trustee is a good sign that you are ready to solve your financial problems and your trustee wants to help.

If you live in Canada and are looking for a bankruptcy trustee I recommend the site www.bankruptcy-canada.ca. This site has a forum where you can ask questions anonymously to a group of trustees for free. It’s a great place to start if you’re not sure whether bankruptcy is for you, and best of all it’s free. They also have some videos that explain the bankruptcy process which may be of some use. If you do decide that you want to file bankruptcy there is also a list of trustee’s by province and city that offer free consultations, once again free is good.

Once you think you have found a trustee you need to make certain that you are comfortable with the people you are going to be dealing with because this relationship is going to last at least nine months. If you are not comfortable with the person you see then you should probably talk to someone else. Remember that all trustees in bankruptcy in Canada are licensed by the federal government, so they will all follow the rules to ensure that the bankruptcy process is administered fairly.