What’s the process to file for bankruptcy? Will I lose my house or car?

4. Learn how bankruptcy works

It's important to understand the entire process before you file for . Speak to your trustee about what the law requires from you before, during, and after your bankruptcy. Depending on your situation, you may be bankrupt for a long time.

When you file for bankruptcy, several things will happen:

  • the trustee will help you to sell some of your to pay your
  • you must go to 2 financial counselling sessions
  • in order to pay your debts, you might have to sell your assets, including your house or car
  • you must give up all your cards
  • if you plan to borrow more than $1,000, you must first tell the lender that you are bankrupt
  • you must file monthly statements of your income and expenses with your
  • you will have the lowest possible (R9)

In addition, you might have to:

  • make
  • go to a 's meeting or to bankruptcy court

When you file for bankruptcy, you get protection from the creditors who are trying to get money from you. While you are bankrupt:

  • you no longer have to make payments on your debts
  • most lawsuits against you will stop
  • your creditors cannot contact you to collect the money you owe

If you do everything you are expected to do, you usually receive an from bankruptcy after:

  • 9 months if you don't have to make surplus income payments
  • 21 months if you have to make surplus income payments

The process of bankruptcy ends when the court discharges most of your debts. This means most of your debts will be forgiven and you will not have to pay any more money to most of your creditors.

If you do everything you are expected to do, you usually receive an automatic from bankruptcy. If you do not receive an automatic discharge, you will have to go to court to discharge your bankruptcy.

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