Bankruptcy in Canada: Debts that Can/Can't be Included
The exact debts that can and can't be included in Bankruptcy vary from province to province.
Will You Lose all Your Assets in a Bankruptcy?
No, you will not lose all of your assets. There are exemptions in place that allow you to keep basic property that you will need for your new beginning. Exemptions range from province to province, and can include such assets as your car, furniture, books and tools-of-trade, and clothing.
For example, a partial list of exempted assets in Alberta includes:
Food for a 12-month period.
Clothing up to a value of $4,000
Household furniture and appliances up to a value of $4,000
Motor vehicle to a value of not more than $5,000
Equity in a principal residence up to $40,000
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What Debts are not Covered Under Bankruptcy in Canada?
When you declare Bankruptcy you will be freeof most, but not all, debts. Secured debts which are tied to a specific asset as collateral (i.e. car loan, mortgage) are not covered under bankruptcy declarations. The law also sets out several unsecured debts that are not covered in bankruptcy claims:
Student Loans less than 10 years old
Awards for assault or sexual assault damages
Alimony claims
Spousal Support
Child Support
Court Fines
Debts resulting from committing fraud or theft
What Debts are Covered Under Bankruptcies?
Canada Personal Bankruptcies free debtors from most unsecured debts, which include:
Credit card balances
Department store accounts
Unsecured lines of credit
Back payment of income taxes and municipal house taxes
Unsecured personal loans
Medical, utility, and insurance bills
Cell phone payments
Payday loans
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Tags: Canada CA, Canada, Canada, Debts Included in Bankruptcy, Debt Counseling, keep assets, lose assets, exemptions, excempted, property, secured, student loans, claims, fines, child support, alimony, unsecured, bills, payaments, credit cards
