Best Bankruptcy Lawyers in Cambridge

About Bankruptcy Law in Cambridge, Canada

Bankruptcy is a legal process that provides relief to individuals and businesses who are unable to repay their debts. In Cambridge, Ontario, and throughout Canada, bankruptcy is governed by federal law under the Bankruptcy and Insolvency Act. Declaring bankruptcy can help protect you from creditors, stop wage garnishments, and provide a path toward a financial fresh start. However, it also comes with significant responsibilities and impacts your credit rating for several years. Understanding the bankruptcy process and its consequences is crucial before making any decisions.

Why You May Need a Lawyer

While bankruptcy can seem straightforward, the legal and financial implications are complex. Here are some common situations where seeking help from a bankruptcy lawyer may be essential:

• You are overwhelmed by debt and do not know if bankruptcy is your best option
• You are facing legal action from creditors, such as lawsuits or wage garnishments
• You own significant assets or have non-standard income sources
• A previous bankruptcy or consumer proposal might affect your current situation
• You need help understanding which of your debts can or cannot be included in bankruptcy
• You are a business owner with business and personal debts intertwined

A lawyer can help you assess your situation, explain your options, and ensure your rights are protected throughout the process.

Local Laws Overview

Bankruptcy in Cambridge is subject to both federal and provincial regulation. The Bankruptcy and Insolvency Act applies nationwide, but certain aspects are influenced by Ontario provincial law, such as exemptions for personal assets. Key local considerations include:

• Bankruptcy Trustees: Licensed Insolvency Trustees (LITs) are the only professionals authorized by law to administer bankruptcies in Cambridge. They work with you to evaluate your assets and debts, file necessary paperwork, and communicate with creditors.
• Asset Exemptions: Ontario law outlines which assets you may keep in bankruptcy, such as a vehicle up to a certain value, tools of your trade, basic household furnishings, and more.
• Credit Counselling Requirements: All bankrupt individuals must attend credit counselling sessions as part of the process.
• Debt Eligibility: Most unsecured debts can be included in bankruptcy, but certain obligations like child support, court fines, and student loans (depending on how long ago you studied) may not be discharged.
• Discharge from Bankruptcy: Most first-time bankruptcies in Ontario last between nine to 21 months, depending on your income and whether you have contributed surplus income to your estate.

Frequently Asked Questions

What is bankruptcy?

Bankruptcy is a legal process that provides relief from debt by allowing individuals or businesses to eliminate most unsecured debts. In exchange, your non-exempt assets are surrendered for the benefit of your creditors.

Will I lose all my assets if I declare bankruptcy?

No, Ontario law protects certain assets from seizure, such as basic household furnishings, clothing, a modest vehicle, tools of the trade, and sometimes a portion of your home equity.

How does bankruptcy affect my credit score?

Bankruptcy will significantly lower your credit score and remain on your credit report for at least seven years after discharge for a first bankruptcy, affecting your ability to obtain new credit.

Which debts are not eliminated by bankruptcy?

Bankruptcy does not eliminate all debts. Examples include child and spousal support, court-imposed fines, and student loans if it has been less than seven years since you studied.

Can my employer find out about my bankruptcy?

Generally, your employer is not notified unless your wages are being garnished or unless your job requires disclosure of bankruptcy (such as certain financial or legal positions).

How long does bankruptcy last?

For most first-time bankruptcies, the process lasts nine months, but it may extend to 21 months if you have surplus income or previous bankruptcies.

What is a Licensed Insolvency Trustee?

A Licensed Insolvency Trustee is a federally regulated professional who administers bankruptcy filings and consumer proposals, offering guidance and acting as an impartial mediator between you and your creditors.

Should I consider alternatives to bankruptcy?

Yes, a trustee or lawyer can help you explore alternatives like consumer proposals, debt consolidation, and credit counselling, which may have fewer long-term consequences.

Will bankruptcy stop collection calls and legal actions?

Yes, once you file for bankruptcy, creditors must stop collection actions, including lawsuits and wage garnishments, due to the legal stay of proceedings.

Can I keep my credit cards during bankruptcy?

No, you must surrender all credit cards when you file for bankruptcy, even if they have a zero balance.

Additional Resources

• Licensed Insolvency Trustees: The federal government website provides a list of licensed professionals in Cambridge who can assist with bankruptcy and alternatives.
• Office of the Superintendent of Bankruptcy Canada: This agency oversees bankruptcy in Canada, offers public records and educational materials.
• Ontario Ministry of the Attorney General: Provides information on rights and responsibilities under Ontario law pertaining to bankruptcy and debt collection.
• Community Legal Clinics: Local legal clinics in Waterloo Region can provide free or low-cost legal advice to those who qualify.
• Credit Counselling Services: Non-profit agencies can help assess your financial situation and provide debt management suggestions.

Next Steps

If you are considering bankruptcy or facing financial difficulty, take the following steps:

1. Gather all of your financial information, including debts, assets, income, and expenses.
2. Consult with a Licensed Insolvency Trustee in Cambridge for a free assessment of your options. They are the only professionals authorized to file bankruptcies in Canada.
3. Consider booking a consultation with a bankruptcy lawyer, especially if your situation involves significant assets, legal disputes, or business debts.
4. Review all available alternatives to bankruptcy, such as consumer proposals or debt consolidation, to find the best solution for your situation.
5. Attend mandatory credit counselling sessions if you proceed with bankruptcy, and stay engaged with your trustee or lawyer throughout the process.

Navigating bankruptcy is challenging, but with the right information and professional support, you can regain control of your financial future.