The decision to file for bankruptcy is a difficult one and it is advised to talk to someone about all of your options before you decide to file. There are many reasons people decide to file for bankruptcy such as a costly divorce settlement, medical bills that have piled up to failed small business. It is best to ask yourself several questions before making a firm decision. For instance, do I or we have large-scale debt? Do our monthly minimums take up all of our living expenses and more? If we do decide to file for bankruptcy, will we promise ourselves to change our spending actions? Do we want to buy a home in the near future?
If your debt in indeed out of control then it is important to be honest with yourself because the decision to file could, in fact, be a move towards integrity and a positive life change for you and your family. Filing bankruptcy is not for everyone and you do have options, so make sure you know all of your options in order to make an informed decision.
What Happens If I Lie To My Licensed Insolvency Trustee?
It is a statutory obligation for every person filing an assignment in bankruptcy to make full disclosure of all assets, liabilities, income and living expenses. As well, you must disclose information as to the disposal of any of your assets within the past 12 months (5 years if the asset is real estate). If you intentionally do not disclose significant information to your trustee, you will have your discharge from bankruptcy opposed by the trustee.
You might even be required to appear in court to explain why you did not disclose full and complete information. The court can impose penalties on you, depending on the significance of the non-disclosure. You should also be aware that you are asked under oath to swear that all of the information that you gave to the trustee is reasonable and accurate to the best of your knowledge and belief.
Swearing a false affidavit is called “perjury” and now you may be charged under the Criminal Code as well as under the Bankruptcy and Insolvency Act. Not a good situation to find yourself in when you are already stressed out over your debts.
What are my responsibilities after I file for bankruptcy?
You have filed for bankruptcy and your creditors have stopped calling. However, you are still responsible to make sure you complete several requirements:
1. You need to be honest and accurate with your trustee regarding your finances. You need to list all assets such as property or a vehicle and you need to list all liabilities (what you owe and who you owe it to). This step also includes disclosing information regarding property you have owned in the past few years-property you have sold or transferred.
2. You need to give all credit cards to your trustee.
3. You need to attend 2 financial counselling sessions and the first meeting of creditors (if you are required to attend). The 2 counselling sessions provide you with information about bankruptcy, managing your finances in the future and budgeting and trying to improve your financial situation in the future.
4. Advise the trustee of an address change
5. There is a chance you may be asked to attend a meeting at the Office of the Superintendent of Bankruptcy. If this is required, you will be asked questions about your bankruptcy such as your conduct and the causes of your bankruptcy.
There are several different bankruptcy discharge scenarios and it depends on a few factors:
1. If this is your first bankruptcy and you are not paying surplus income (income you would be using to make payments if you earn over a certain amount each month) then you will be automatically discharged 9 nine months after filing for bankruptcy.
2. If this is your first bankruptcy and you are paying surplus income, your automatic discharge will be 21 months after you filed for bankruptcy.
However, you must attend 2 financial counselling sessions and make sure you are always truthful and disclose all information to your trustee because the trustee and/or the Office of the Superintendent of the Bankruptcy office has the right to oppose the discharge if any discrepancies occur.
3. If you do not qualify for an automatic discharge, you need to contact your trustee and they will set up a date for a discharge hearing. This hearing involves the court deciding whether or not you will be discharged. They consider initial reasons you filed for bankruptcy, if you have attended the financial counselling sessions and your financial conduct and affairs during your bankruptcy.