What is Personal Bankruptcy
The Bankruptcy and Insolvency Act of Canada provides several related definitions that pertain to the legal remedy of bankruptcy. While the word itself is evocative of failure in a person, it is a remedy that helps the person be relieved of what they owe to their creditors.
What makes a person go bankrupt?
Statutory construction of bankruptcy under the Bankruptcy and Insolvency Act defines bankruptcy as a legal state of a person who has recently declared themselves as such. This does not embrace the scope of what it means to be bankrupt.
Legal definitions provide that a bankrupt state is where a person who has made an assignment or against whom a bankruptcy order has been made, or once more, it is a legal status. Bankruptcy in these contexts, is both a status and a legal remedy.
It would be time to talk about how bankruptcy applies to you as a legal status. The decision to declare bankruptcy is never an easy one, as you may have contemplated if this would be the best option for your immediate needs.
Chances are that you have been mired in so much debt, exacerbated by the effects of the pandemic, that you find that there is no other recourse except to recoup your financial status with a bankruptcy declaration. Bankruptcy now as a legal remedy provides you with the means to eliminate most of your debts, but this is not a cure-all for all debts.
The elimination of debts refers to unsecured debts such as those that you have incurred with the use of credit cards. Unsecured debts, just so we are clear, are the types of debts where you have not provided any form of security as a form of collateral in the event that you are unable to meet your obligations.
Secured debts are not eliminated with the declaration of bankruptcy, so these are still obligations that you have to meet, but with a renegotiated mode of payment that would ensure that you still have enough to live on.
Recap
Red Deer Personal Bankruptcy helps you navigate the intricate world of bankruptcy, as we link you with the Licensed Insolvency Trustees that would help you out with your need to declare bankruptcy and ensure that you have the best representation for your debt issues and tax concerns with the CRA that you will know where you and your personal finances stand after you avail of this remedy.