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Duties while Bankrupt

A BANKRUPTCY PROVIDES IMMEDIATE PROTECTION FROM CREDITORS

When an individual files bankruptcy with a Trustee, the federal government assigns an estate number. Upon registration of their bankruptcy, the Bankrupt is provided with a Legal Stay of Proceedings suspending all creditors’ actions which provides them with protection against all lawsuits and collection activities by those creditors.

 

EVERY BANKRUPT MUST PERFORM CERTAIN MANDATORY DUTIES

Once bankrupt, the Bankruptcy and Insolvency Act requires a person to participate in and perform certain duties in return for forgiveness of their debts. These duties are mandatory and must be satisfactorily performed before their debts are permanently forgiven and a person receives their discharge from bankruptcy.

If one does not perform or neglects their duties, they remain in bankruptcy and if these deficiencies are not corrected prior to their discharge application, their bankruptcy protection can be  canceled and their creditors’ rights reinstated.

WHAT ARE ONE’S DUTIES IN A BANKRUPTCY

A Bankrupt must:

1. Disclose and deliver their non-exempt property to the Trustee;
2. Make oneself available and, if requested, attend a meeting of their creditors;
3. Attend two financial counselling sessions;
4. Complete and submit Monthly Income and Expense Statements for review by their Trustee throughout the period of bankruptcy:
5. Report, calculate and, depending on the number of people in their family, remit or
contribute a portion of one’s monthly income to their bankruptcy estate for distribution to
the creditors;

6. Assemble and submit all tax information to the Trustee so they can file your taxes.