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Canadians by the thousands have been declaring bankruptcy as a means of getting a fresh financial start in these troubled times. Is an Edmonton bankruptcy the right thing for you? 

The federal law that sets out the standards for bankruptcy in Canada is called the Bankruptcy and Insolvency Act (BIA).  The law requires bankruptcies to be filed and administered by trustees licensed by the government.  There are also Provincial laws that apply to bankruptcy filings in each of the Provinces.

There is no question that a personal bankruptcy will allow you to eliminate most of what you owe and start over, but it comes at a price.  It will impact your credit rating for years to come and you may very well lose some of what you own.  Depending on your income, the out of pocket costs may far exceed the costs of hiring a bankruptcy trustee and paying court costs. 

An Edmonton bankruptcy will protect you from creditor collection activity but you need to be sure you are fully aware of what you are getting into before you file.  To do that, you turn to the same source you use if you ultimately decide to file – a bankruptcy trustee licensed in Alberta. 

Regardless of whether you are already sure you want to file or you are still looking for advice and alternatives, the first step you need to take is to contact a trustee.  The Internet is a good source for compiling a list of Alberta trustees from which to choose.

Contact a trustee and set up an initial meeting, which is almost always at no charge, so you can meet with several trustees if needed.  At the first meeting the trustee will review the details of your particular financial situation.  With that information, the trustee can determine if an Edmonton bankruptcy is your best option.  There are alternatives and you may qualify for one.  If bankruptcy is your choice, here’s what will happen next:

You’ll get a form to take home and complete, on which you will record the details of your financial life.  You’ll need to check your records and spell out all that you owe as well as your monthly payments for each of your debts.  You’ll need to lay out what it costs for you to live each month – your utility bills, the costs of transportation and food, and so on.  You’ll need to provide details of all your sources of income. 

You’ll meet again with the trustee who will review the information for accuracy and completeness.  If you decide to proceed, the trustee will take a few days to complete all of the paperwork necessary to file your Edmonton bankruptcy with the Office of the Superintendent of Bankruptcy.

Once you sign the paperwork and the trustee files it, you are officially bankrupt.  At this point a “stay of proceedings” is issued, requiring your creditors to cease any collection activities currently underway and barring them from engaging in any future collection activity or communicating directly with you in any way. 

If you’re concerned about who will know that you’ve filed for bankruptcy, you should know it is a matter of public record in the court system but only very high income filers require bankruptcy notifications in the local newspapers.  The fact is, for almost all filers of an Edmonton bankruptcy, no one will know unless you tell them.