Bankruptcy in Manitoba

How Do I Declare Bankruptcy in Manitoba?

  • By Jillian Taylor-Mancusi, LIT

If you feel unable to repay the mounting debt you owe your creditors, it’s likely you’ve already considered filing for personal bankruptcy.

Perhaps you’ve started missing your mortgage payments, your wages are being garnished, or a creditor has started a lawsuit against you. Maybe you’re just tired of all the constant collections calls.

Whatever the reason, if you’re finally ready to deal with your debt problems head on, you have already made a gigantic step toward getting rid of your debt – and the anxiety that comes with it.

Bankruptcy can be a difficult choice, but it also offers eligible debtors significant benefits.

Advantages to Filing for Bankruptcy

1. Immediate protection from your creditors.

Because bankruptcy is a legal process in Canada, once you file the Assignment, an “automatic Stay of Proceedings” takes effect. This essentially means:

  • Those collections calls will stop;
  • Wage garnishments will stop;
  • Frozen bank accounts will be released; and
  • Legal actions against you will be stopped – and new actions cannot be started.

2. The ability to eliminate your unsecured debts.

With a few exceptions, a bankruptcy will eliminate your unsecured debts. That’s because once you receive your discharge from bankruptcy, you will no longer be required to pay the unsecured debts which were discharged in the Bankruptcy. There are a few debts that cannot be discharged in a bankruptcy. They include child support and alimony, student loans that are less than 7 years old, fines and penalties of a court, and debts that are the result of fraud or misrepresentation.

3. The ability to “start fresh.”

Once your unsecured debts are behind you, you will have the opportunity to put in place a financial plan to build a better financial future for you and your family — a plan based on your priorities, rather than the urgency of collections.

How Do I File for Bankruptcy in Manitoba?

Once the decision has been made to proceed with bankruptcy, the process of doing so is actually quite easy.

These three steps will get you started.

Step #1. Find a Licensed Insolvency Trustee (LIT).

In order to file for bankruptcy in Manitoba, you’ll need the help of a Licensed Insolvency Trustee.

These are the only professionals authorized, licensed, and regulated by the Federal government of Canada to help hard-working debtors like you file for Bankruptcy.

Your Licensed Insolvency Trustee administers your Bankruptcy, providing financial counselling, communicating with your creditors, and holding any payments received in trust for the benefit of your creditors.

Step #2. Meet With Your Licensed Insolvency Trustee.

It isn’t just bankruptcy that your LIT can help you with.

These professionals can provide you with a full range of debt relief options.

At your free, initial consultation, we’ll sit down with you and review your current financial situation. We’ll go over all the debt relief options available to you.

Step #3. File for Bankruptcy.

If you ultimately decide to file for bankruptcy, your Licensed Insolvency Trustee will request some information from you, including your personal details, a list of creditors, and a list of your assets.

Your LIT will then prepare the necessary paperwork and review it with you to ensure its accuracy, and to verify your understanding of the process.

Once you sign the paperwork, your bankruptcy begins, and your trustee will notify your creditors.

What Happens After I File for Bankruptcy?

You’ll be required to complete your bankruptcy obligations as set out in the Bankruptcy and Insolvency Act of Canada. Your LIT will give you a complete list of these duties. They will include things like providing a monthly income statement to your Trustee, your attendance at the two mandatory credit counselling sessions, keeping your Trustee up to date on your contact information, and providing the Trustee with tax information so that your tax returns can be filed.

You will be required to make a monthly payment to your Trustee. The amount of this payment varies, based on your ability to pay. The federal Superintendent of Bankruptcy issues an annual chart that indicates how much money is necessary to live, for families of various sizes. If you have any excess income (over and above what the guidelines indicate is necessary), you will be required to pay 50% of that extra income to the Trustee for your creditors. The remaining half of the excess income is yours to keep.

A first time bankruptcy is usually discharged in 9 months’ time, if duties have been completed, and there is no excess income. Excess income moves the discharge date to 21 months from the date of bankruptcy.

Are There Drawbacks to Filing for Bankruptcy?

One of the biggest disadvantages is the effect a bankruptcy can have on your credit score.

But think of it this way: If you’re habitually missing loan payments or your bills are falling past due, it’s more than likely that your credit rating has already taken a beating. This type of delinquency stays on your credit report for years.

And while a bankruptcy will stay on your credit report for 6 years after your discharge, at least you will have eliminated that debt completely. It’s a full solution to your accumulated unsecured debt that gives you the chance to start over.

Contact a Licensed Insolvency Trustee Today

If you’re wondering whether a Manitoba bankruptcy is the right next step for you or your family, contact us today. Remember, the sooner you reach out for professional help, the more debt relief options you may have available to you. Bankruptcy may not be inevitable. So get started on the fresh financial start you deserve, and contact us today.

If you need a little more information on how to file for bankruptcy in Manitoba, give us a call or set up an appointment to come in to see us. We will do an in-depth review of your situation and help you find a solution that works for you — a solution that gets you back on your feet, financially.

Jillian Taylor-Mancusi, LIT

Jillian has worked in the insolvency field since 1992. She is a graduate of the University of Manitoba. She received her Insolvency Counselor’s Qualification Certificate from Ryerson Polytechnic University in 1998, and in 2007 she attained her license as a Licensed Insolvency Trustee. Jillian is a Read More Jillian has worked in the insolvency field since 1992. She is a graduate of the University of Manitoba. She received her Insolvency Counselor’s Qualification Certificate from Ryerson Polytechnic University in 1998, and in 2007 she attained her license as a Licensed Insolvency Trustee. Jillian is a member of the Canadian Association of Insolvency and Restructuring Professionals (CAIRP). She is Past President of the Manitoba Association of Insolvency and Restructuring Professionals (MAIRP).Jillian has held positions on the Armstrong Point Association, Executive of her local EDA Riding Association, Manitoba Highland Dance Association, and the Continuing Education Committee of CAIRP. Previously, Jillian was the Treasurer for the Parent Association at her daughter’s school. Currently, Jillian serves as the Chair for Dressage Winnipeg. Close

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