The fear of bankruptcy is a major source of stress for many Canadians, particularly in Quebec and Ontario. Although the Bankruptcy and Insolvency Act (BIA) is federal, certain provincial realities must be taken into account. Here are the seven main questions most often raised during the initial consultation.
Will I lose my home?
For homeowners or condo owners, the fear of losing this major investment is often the primary concern. Unless an individual wishes to surrender their property, it is very uncommon for a home or condo to be seized in a bankruptcy context. In Quebec, specific legal protections apply, while in Ontario, limited exemptions may apply depending on the amount of equity. Bankruptcy does not automatically result in the loss of a primary residence, but each situation must be carefully reviewed.
Will I lose my car, RRSPs, or personal belongings?
In a bankruptcy, the law of the province where the assets are located applies. Each province has a list of assets that are exempt from seizure. Quebec protects property necessary for daily living, while Ontario provides value-based exemptions for household furnishings, tools of the trade, and vehicles. RRSPs accumulated more than 12 months prior to the bankruptcy are exempt from seizure across Canada.
When will I be able to get credit again?
Bankruptcy generally affects your credit report for six to seven years. This concern is universal, as it can complicate future access to credit and delay major projects such as purchasing a first home. Your Licensed Insolvency Trustee will explain the specific impact on your situation.
Will I lose my job?
In both Quebec and Ontario, an employer cannot terminate an employee solely because of a bankruptcy. Legislative protections are in place. However, certain positions in the financial sector or regulated professions may be indirectly affected.
What debts are included in a bankruptcy?
Some debts survive bankruptcy, such as child or spousal support, certain fines, and recent student loans (less than seven years), as outlined in the BIA. Consulting a Licensed Insolvency Trustee is essential to understand what can and cannot be included.
Will everyone find out?
Despite greater public awareness, shame and fear of judgment remain common. This psychological aspect is often underestimated. Except in rare cases, bankruptcy information is not public.
How much does bankruptcy cost?
​Bankruptcy is an affordable process. Costs are based on the individual’s ability to pay and are generally spread over monthly payments.
Still have questions? Consult one of our Licensed Insolvency Trustees (LIT) for confidential, compassionate guidance.
The first consultation, whether in person or virtual, is free and without obligation.
If you feel overwhelmed by your financial situation, there is no shame in seeking help from a Licensed Insolvency Trustee.
Contact the Ginsberg Gingras team:
By phone: (800)567-1905
Website: ginsberg-gingras.com