Loans Mortgages Cards Banking Investing Tools Locations FX Insurance Learn ← Bad credit options The fresh start option, explained simply. Bankruptcy in Canada wipes most unsecured debt in 9–21 months. It's regulated by the federal Bankruptcy & Insolvency Act and only a Licensed Insolvency Trustee can file it. Free first consultation.
What actually happens — week by week Week 0 Free consultation You meet a Licensed Insolvency Trustee. Free, confidential.
Week 1 Sign the assignment You file. Stops creditor calls, lawsuits, wage garnishment, instantly.
Month 2 First creditors meeting Usually a formality. Most creditors do not attend.
Month 5 Two financial counselling sessions Required by law. Practical money skills.
Month 9–21 Discharge Debt is wiped. Fresh start. R9 on your credit file.
What bankruptcy wipes out — and what survives ✓ WIPED CLEAN Credit card debt Unsecured personal loans Payday loans Lines of credit Old utility bills CRA tax debt (yes — most of it) Old phone bills · collections Most overdraft balances × STILL ON THE HOOK Mortgage (unless you walk from the house) Secured car loans (keep paying, keep the car) Child & spousal support Court fines, restitution orders Student loans under 7 years old Debt from fraud or false pretences Real questions, real answers Will I lose my house? − Usually not. Your home equity has a provincial exemption (varies — Alberta exempts $40k, BC exempts $12k, etc.). If you have more equity than the exemption, you must "buy back" the excess from the trustee — many people pay it in instalments over the bankruptcy term. Will I lose my car? + How long does bankruptcy stay on my credit? + Can I declare bankruptcy on CRA debt? + Bankruptcy vs consumer proposal — when does each win? + Will my employer find out? +