What is the First Step If I Need to Go Bankrupt?

I am often asked how to start the bankruptcy process in Ontario.

At Hoyes, Michalos & Associates Inc., the first step is for you to meet with one of our professionals to determine if bankruptcy is the correct option for you. And when we meet, we will always ask you these three questions:

Who do you owe money to?

What do you own (a car? RRSP? House?)

How much do you earn each month, and what do you spend it on (in other words, we would like to see a simple monthly budget)?

During our meeting we will probably ask you many other questions as well, because we need to understand your situation before recommending a solution.

For many people, a detailed budget can help them identify areas to reduce expenses, so that they can free up enough cash to pay off their debts on their own. (Try this: add up how much you spend at the coffee shop each month! By making your own coffee instead of buying it, you may be able to cut your expenses enough that bankruptcy isn't necessary).

By preparing a budget and cutting expenses, you may find that you qualify for a a debt consolidation loan.

If budgeting alone isn't enough, or if you don't qualify for a debt consolidation loan, we may recommend a debt management plan through a licensed credit counsellor to deal with your debts.

If your debts are to high for a debt management plan, a consumer proposal may be the solution.

Only if all of these options are not suitable for your unique situation will we recommend that you explore the bankruptcy option.

So to answer the question, the first step is for you to contact us today, so that one of our professionals can help you explore your options, and show you how to get a fresh start.

Posted by J. Douglas Hoyes, CA, Trustee @ 8:06 PM

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