Bankruptcy is a serious financial decision that can have significant consequences for individuals and businesses. In Ontario, Canada, filing for bankruptcy can provide relief from overwhelming debt, but it's essential to understand what happens next.
Step 1: Filing the Bankruptcy Petition
After you file for bankruptcy in Ontario, you'll need to complete the bankruptcy petition and attach supporting documents. The bankruptcy trustee will review your case, and if approved, they'll begin the process of liquidating your assets to pay off creditors.Step 2: Trustee Administration Once the bankruptcy process is underway, the trustee will take control of your affairs. They'll manage your income, sell off non-essential assets, and distribute any remaining funds according to the court order. The trustee's primary goal is to ensure that creditors receive a fair share.
Step 3: Credit Counseling and Debt Repayment
As part of the bankruptcy process, you'll be required to participate in credit counseling sessions with an approved credit counselor. This helps you develop a budget and create a plan to manage your debt over time. Additionally, some creditors may request payments or settlements to settle outstanding debts.Step 4: Discharge After the bankruptcy process is complete, the court will grant you a discharge of your debts. This means that any remaining debt obligations will be wiped out, and you'll no longer be responsible for paying those debts. However, keep in mind that the creditor may still pursue you for repayment or claims in the future.