If you want your debts to be eliminated you need to keep your eye on the goal. That goal is obtaining your bankruptcy discharge. To get that discharge, and have no more debts at the end, you need to complete the process — all of the process.
I can’t stress the importance of this statement enough. There are few options for changing your mind once you have begun and they all involve paying more money back to your creditors.
I meet people who did not complete the duties associated with their bankruptcy and come back years later surprised to hear that they were never discharged. What causes them to reach out is the fact that they have tried to get new credit or have needed to file another insolvency procedure only to find the original bankruptcy needs to be dealt with.
The duties required during your bankruptcy are not overly onerous. The biggest requirements include providing information to the trustee such as tax return information and monthly income and expense statements, making your necessary payments and attending two credit counselling sessions. These sessions are mandatory, not optional, but they are there for your benefit to help you recover from bankruptcy with stronger money management skills.
If you do not complete all of these duties you will not get discharged. Since your bankruptcy discharge is what eliminates your responsibility to pay back your debt, not receiving your discharge can pose a problem.
So what happens if you don’t finish the process? Well first, the trustee can apply to the court for his discharged. This means he is no longer administering your bankruptcy. Once this has happened on top of all of the other outstanding duties you will need to pay an additional fee up front to have the trustee reopen the file. You then need to complete all of your outstanding duties. And then, you need to have the bankruptcy court grant your discharge which may mean going to court and facing the judge.
Once the trustee is discharged, all of the original creditors are able to come back. They will charge you interest for the entire time you were supposed to be in bankruptcy and can begin to pursue collection activity again. They also have the right to pursue legal action against you, like put a lien on your assets or garnishee your pay cheque. And let’s say that the reason you went bankrupt in the first place was due to a garnishment, well, the original judgement is valid once again and they can go right back after your pay cheque and there will be nothing you can do to stop them either than pay the debt in full.
Bankruptcy doesn’t have to be hard. It is a process and you must complete the process. We are here to help you every step of the way but we can’t do it for you and once you start it is in your own best interest to finish.
2 time bankruptcy will I be able to keep my house ? still have mortgage for 12 more years?
Hi Sylvain. Yes, even in a second bankruptcy it is possible to keep your house, however the answer depends on the value of the house, and the amount owing on your mortgage. You should contact a licensed insolvency trustee to do the math and advise you on your options.
I am in a second bankruptcy, and have not done much of anything. I honestly can’t afford the payment.
I don’t know what to do?
Hi Leona. You should immediately contact your trustee and work out a plan. If you don’t complete your duties a court hearing will be scheduled, so it is better to have a strategy worked out with your trustee to complete your bankruptcy if possible.
Hi I filed for bankruptcy but failed to make all my payments . The trustee has since been discharged and my bankruptcy is not complete . This was several years ago . Is it possible to start making payments to someone in order to complete the bankruptcy or can/should I restart ??
You should contact the trustee that originally handled your bankruptcy to see what they think you need to do in order to be discharged (complete the bankruptcy). You may approach a different trustee or ask a lawyer to assist you, but at the end of the day, the Court will ask your original trustee what items/duties remain outstanding and you will need to complete those duties in order to be discharged.
I filed for bankruptcy in August 2013 and never finished it. I have paid a lot of the debts off myself that were included in the bankruptcy. My question is, since I can’t seem to find it anywhere on the internet… Will an unfinished bankruptcy at any point purge from my credit report or will it remain there forever until discharged?
Most “history” items on your credit report disappear after 7 years. The 7 year clock starts when the event is last reported to the credit bureau – that was probably whenever the trustee closed their file. The fact that you are an undischarged bankrupt remains until you are discharged. If you apply for credit, or a job or are asked “have you ever filed for bankruptcy will always be “yes” and if they ask when you completed the file the answer will be “I didn’t”. If you’ve paid off most of the debts you may want to contact the trustee that handled the file to see about having the bankruptcy annulled. It involves going to Court, but depending on what you still owe, it might make sense…
My husband filed for bankruptcy while we were separated this was about 12 years ago. He did not follow through with the bankruptcy and the trustee that he had no longer exists so what are our options for him to complete the bankruptcy and be discharged?
Hi Kristina. If he is an undischarged bankrupt and the trustee no longer exists you should contact the Office of the Superintendent of Bankruptcy and ask them for copies of your file which may indicate what actions are required to complete the bankruptcy. It may then be necessary to find a trustee or insolvency lawyer to make an application to bankruptcy court to obtain his discharge.
Dear Mr. Michalos, I haven’t been discharged since 2009 because I didn’t attend the bankruptcy hearing due to the birth of my son and I suffered health issues from the birth for almost a year after. I still have not been discharged and it’s very frustrating dealing with my trustee who now won’t release/reopen the file unless I pay a large fee,. I had an insolvency lawyer look at the case, and I was waiting for him to administer a motion to the court to finalize the discharge, although was never processed properly. Would I be able, personally, to file a motion myself to the court, with the aid of a lawyer, since I did all my duties and now almost ten years later I’d imagine the bankruptcy should be dissolved somehow? Since one of my creditors, in a letter, stated, their loan was already discharged, however, to my understanding, an actual certificate of discharge Is needed to finalize an actual bankruptcy.
Yes, you can make a motion to court yourself; you should contact the bankruptcy court and ask the court clerk to advise you on the forms that need to be filed in court, and ask them to book a hearing date so that you may appear. Ideally having an insolvency lawyer make the court motion is preferable, because they understand all of the requirements and therefore will have a greater chance of success.
Hello,
I was pressured into bankruptcy by my boyfriend at the times parents, I went to the meeting but then we were victims of a violent home invasion, that left me traumatized due to what was done to me, and Because of the threat made we had to flee for our safety.
I didn’t want to mess up with bankruptcy but had to leave, It was with JP Graci, and since I’ve contacted the office they say they have nothing on me but I need to finish what I started as It will never leave my credit.
What’s an option for me? Any help is appreciated. Thank you for taking the time of read and answer my concern and question.
Bankruptcy law is particularly clear – if you start the process you must finish the process. If it remains unfinished you remain an “undischarged bankrupt”. There are a few different ways to finish the process:
1) complete the duties and responsibilities of a bankrupt – this means going back to JP Graci and asking them for a specific list of what you need to do in order to complete your bankruptcy. This is the most common way to finish a bankruptcy.
2) File a consumer proposal based on the debts from your bankruptcy. Once approved by the Court the consumer proposal causes your bankruptcy to be annulled (cancelled). You don’t have to use JP Graci to file the consumer proposal. A word of warning – if you file a proposal, but don’t complete it you will be deemed to have filed bankruptcy again.
3) Apply to the Court to have your bankruptcy annulled. To do this you must prove either you were not eligible to file bankruptcy in the first place, or that you have repaid all of the debt sin full. You’ll need a lawyer to bring this motion for you.
There are a small percentage of people that never complete their bankruptcies. It means accessing credit in the future will always be difficult and usually, at some point, you;ll want to apply for a mortgage or loan that may require you to complete your bankruptcy. As a general rule, the sooner you complete a bankruptcy the easier it is to do so – the more time that passes the more difficult it may become.
Im in a second bankruptcy and due to circumstances took me several years to complete my payments to the trustee. they were aware I was having difficulty. I have now completed all payments and counselling sessions and have a hearing date. I did go to one hearing a few years ago but the judge wanted to be sure I had all my tax returns done before discharging. All that is done and paid up to date.
My question is when I go to the hearing, will I be asked to pay more towards my bankruptcy – at the time I had a job that did not pay well and in the last year and half I obtained a new job that pays almost twice as much
Also can my creditors named in the bankruptcy come after me still
While quite literally the Court may Order whatever it feels is reasonable at a Discharge Hearing, if the Court asked you to make sure taxes were filed and paid last time you were there and you have done that then the Court is unlikely to ask you for anything further. If you are concerned I suggest you call your trustee and ask them if any new issues have come to light and whether or ton the trustee will be asking the Court to impose any additional conditions on your discharge.
Once you have been discharged you are no longer legally obliged to deal with the debts listed in your bankruptcy. Unless a debt falls under Section 178 of the Act (Google it if you’d like to see a list of these debts).
Good luck with your future.
I met with a trustee and at that time he felt I shiuldcreclate bankruptsy.
I did and 30 minutes later tried to phone to cancel no luck.
What happens if I just dont go to the meetings required or do the monthly reports.
My only income is cpp &oas.total 1900.
I did get ei fir 8 months
I am 70 years okd
Hi Ken. You should talk to your trustee. They know what the requirements are to complete your bankruptcy. If you don’t complete your duties, you will not be discharged.
Hi Ken
I am trying to figure out where/when my Absolute Order of Discharge went missing from my estate file from 1988….Can you tell me how the paper trail flows once you are discharged from bankruptcy and your Trustee informs you, that you are Absolutely Discharged? What happens next….Where do your files go from the Trustee’s office? To the OSB…or somewhere else? The reason I ask is my Absolute Order of Discharge was not in my file sent to OSB for archiving (they claim) and so they declared me an undischarged bankrupt in their system without me knowing….that happened 32 years ago! No one ever contacted me about it, I thought all was completed because my Trustee told me I was Absolutely Discharged in 1988. I found out about this issue when I looked into my Estate file recently (2019) and was stunned to learn about this. In order to correct the problem OSB has told me to produce the Discharge order from 1988… but the Court disposed of it in 2007….It seems I am being held responsible for someone in the Bankruptcy system not doing their due diligence with my paperwork in 1988. Can you explain how the file moves from Trustee all the way to OSB archives, I am trying to get clarity as to how this could happen…
Hi Beth. Typically the court would issue an absolute order of discharge and would send it to the trustee, who would then send a copy to the bankrupt, and a copy to the OSB. If the court has a record of you being discharged, it may be necessary to return to court and ask them to issue you a new absolute order of discharge. If your trustee is unavailable to assist, you may need to contact an insolvency lawyer for assistance.
Hi I want to know what will happen to my bankruptcy process I didn’t fill out my monthly income documents and didn’t make any payments my discharge date is coming up by the end of December 2019 I owe about 80 000$ to cra.
If you don’t complete your duties, you are not eligible for an automatic discharge from your bankruptcy. You would be required to go to bankruptcy court and it will then be up to the bankruptcy judge whether or not you receive your discharge, and what conditions are imposed at that time. This is something you should immediately discuss with your trustee.
Hi, my end date is coming on my bankruptcy term. I was really bad and didn’t send in my budget forms or send money for months, and my trustee sent me documents to sign basically saying they’re going to oppose. Well, I have since sent in all budget forms missing and supporting docs, as well as paid everything I believed I owed based on my income for that time. Assuming my calculations are correct on what I owed for payments, should I be “good” now? Or am I too late do you think? Can I be opposed still out of principle of punishing my seemingly lackadaisical attitude, despite “getting everything in”?
Unfortunately, you didn’t get everything right – by your own admission you were late with paperwork and payments. It is literally up to your trustee to decide if they think you should have to appear in Court to explain why you didn’t do things properly. The Court understands people having a tough time paying – afterall you filed bankurptcy becuase you had money problems. The Court is less understanding about people that don’t submit their paperwork, or tax info, or attend their counselling sessions – these things are all “free” so there isn’t a good reason not to do them. Sorry – you need to speak with your trustee.
I declared bankruptcy a very long time ago …made all my payments for 21 months and then at the end they wanted a lump some of around $2500 at that time I was a full blown drug addict and could not finish. Its been years later and now I’m sober and obviously want to make things right but honestly dont even remember the name of place I did the bankruptcy. I’m employed and doing well but it sounds like trying to do the right thing could just ruin your life again? Like I dont even know if I can do taxes because of it …honestly dont feel like ending up on the streets or in jail cause of not knowing how to handle this problem.
Hi Matt. You can contact the Office of the Superintendent of Bankruptcy and they can tell you who your trustee was, and your trustee can explain what steps are required to complete your bankruptcy.
Just curious I went to file a bankruptcy at the age of 22 . I didnt get the information available to others that we get now a days . . I did not want to enter bankruptcy. I signed papers for what I thought was just a disclosure for information the trustee was very limited in the info he gave me.. now 18 years later and it’s still on my credit . I was never assigned any directions. Or meetings . And the trustee who did it is no longer in business how do I fix this and get this bankruptcy off my record . As I never wanted to go through with it . I am trying to fix my debt so my wife and I can purchase a home.. I went to a trustee to file a consumer proposal to find out . 18 years later I had a bankruptcy on my profile.. I need to get this removed and or discharged how do I do this after 18 years and with given false information
Hi Ryan. You need to meet with a trustee (or an insolvency lawyer) and have them walk you through your options It appears that you are an undischarged bankrupt, so you either need to go to court to get the bankruptcy discharged, or under certain circumstances it is possible to file a consumer proposal even though you are an undischarged bankrupt, but again, these are complicated matters, so you will want to consult with a trustee or lawyer to explain in detail your options.
In 2007 I filed bankruptcy to avoid ei money’s i owed and did not follow through. In 2009 I went to same trustee and filed again to stop garnishee. Again I did not follow through but faced my collections with ei and other debtors. 10 years later how do I get discharged
The quickest way will be to contact that same trustee and ask them what you need to do in order to be discharged. You do not have to use the trustee, but the other option is to hire a lawyer to bring a motion before the Bankruptcy Court requesting your discharge. the first thing the Court will do is ask the trustee you used what remains “undone” (so you will be paying a lawyer to ask your trustee the same questions you’d have to ask them yourself).
There is an added Covid-19 complication in that the Courts are effectively closed to all, but emergency matters. There is no way for you to be discharged without going to Court…
Hi
I filed a bankruptcy in 2017
was to take 2 years to pay off. Got a notice saying in April 2020 that I have not completed my obligations because I owed for an additional 12 months. Should they have not notified me sooner rather then a year later to say I owe more money, I can not come up with a big lump sum of money so what are my options. They court has ordered my income tax returns to go to them. If I do monthly reports for those additional Months will they just keep my income tax until those months are paid off.
Hi Lisa. Yes, your trustee should notify you if you owe surplus income. I would suggest that you book a meeting to review this with your trustee, since only they have the details on the specifics of your file.
In 2008 I filed for bankruptcy. During that time I was making very little money and was unable to make the payments. Thankfully, since that time I make good money (and also invest) and every year I have been eligible a tax return. Starting 2013, they have been withholding my tax returns (understandably, note I have never owed CRA). I have been checking with CRA and eventually the debt has been fully repaid and now I have money they now owe me. I contacted CRA and they said contact the trustee so I can start receiving my tax returns again and be discharged. Is that all I have to do?
That will be the first step – contact the trustee that helped you back in 2008. Good luck.
I was discharged in august 2020. Filed November 29 2019. For some reason I can’t seem to get Them off my cra account It says my income tax return will go to them but it shouldn’t how do I fix this so I can get my return come to me not them
Only your 2019 (and any prior year’s) income tax refund should go to your trustee. Your 2020 should come to you. CRA may have a hold on your account until they receive and process the fact that you have been discharged. This is something you need to speak to your trustee about if it persists. Sorry.
if you owe txes can they go after a tax free saving account
Yes, tax free savings accounts are not protected under the law from seizure (neither are regular savings accounts).
Declared bankruptcy about 8 years ago in British Columbia,Canada after I lost my business during the recession. I moved another country and started a new life and about to get retired so our plan is move back to Canada. I just realized my bankruptcy deleted from equifax but not from transunion. I contacted transunion but I learned that , bankruptcy is dismissed from discharge actually it will stay in my file forever until I get cleared. Equifax says otherwise not dismissed it still cleared after 7 years later. So what is the law? and what to do ?
Thank you
If you did not complete your bankruptcy before you left the country then you will remain an undischarged bankrupt until you do. Equifax and Trans Union may have different polices regarding how long they will display the fact on your credit report, but the report is not a legal document, it is for information purposes only. If asked in Canada “have you ever been bankrupt?” your answer will be “yes, and I am still bankrupt” until you have been discharged. Sorry, but that is how it works.
I started a bankruptcy proceeding in 2009 under the duress of a separation. The only person I owed was CRA. I have paid them back after many years. My trustee discharged himself in 2012 as I wanted to pay off my debt. Now that it is paid in full how do I obtain a discharge?
You have to apply to the Court to be discharged. If the debt has been paid in full then you may want to ask for the bankruptcy to be annulled (cancelled) instead. You may call the trustee that handled your bankruptcy, but they will likely tell you to hire a lawyer to make the motion (a lawyer might be cheaper anyway).
I went through a bankruptcy starting in jan 2017 and was given an absolute discharge in oct 2018. I had contacted my trustee on a number of occasions to ensure that nothing further needed to be done and he told me there wasn’t anything else outstanding. My trustee filed my post bankruptcy taxes and there apparently was a refund to be paid. I received a threatening email and phone call in February of 2021 where the trustee stated that he never received the income tax refund because he had provided the Canadian revenue agency with the wrong address for himself. He is wanting to regain access to my CRA account once again to locate the refund and has told me if I don’t sign the forms to give him the access that he will go back to the courts to reopen my bankruptcy again. Is this possible, and should I be held accountable for a trustees mistake? Should I be looking over my shoulder the rest of my life with the threat of my trustee wanting to undo my discharge?
Hi Vicki. This seems like a strange request from the trustee, since until they trustee is discharged they have access to your information at CRA. If you think the trustee is acting inappropriately, making threats, you can file a complaint with the Office of the Superintendent of Bankruptcy.
11 17-Oct-2016 Winnipeg-QB NOTICE OF MOTION (MASTER) BY TRUSTEE, SEC 67 & 68
12 17-Oct-2016 Winnipeg-QB AFFIDAVIT SUPPLEMENTARY OF DOUGLAS G. COLLINS, SW 14OCT2016
13 18-Oct-2016 Winnipeg-QB AFFIDAVIT OF SERVICE NOT/MOT & AFFT ON BRUPT & OSB 14OCT2016
14 23-Nov-2016 Winnipeg-QB DISPOSITION SHEET SENIOR MASTER LEE 23NOV2016 ORDER GRANTED TO DECLARE REFUNDS 2011, 12, 13 AS ESTATE ASSETS
15 06-Dec-2016 Winnipeg-QB ORDER SR. MASTER LEE, 22NOV2016. .2011, 2012 & 2013 TAX REFUNDS ARE ASSETS OF THE BKRPT ESTATE
I cut and pasted what was done by a trustee who has since quit my file
Does this mean all future tax refunds will be frozen???
I have recently completed all my returns up to year 2020..and I am expecting a refund
Once i get those funds..am i allowed to have my bankruptcy annulled
My debt was never that high, and I feel i should never have filed for bankruptcy in the first place years ago
I was unemployed for over 6 years ..health issues..
Hi Blanche. Without the full paperwork, I can’t fully interpret this. It appears that your tax refunds for the period prior to your bankruptcy filing are assets of the estate. I would suggest you either contact your trustee, or if you can’t reach them, you should contact the Office of the Superintendent of Bankruptcy or an insolvency lawyer for further direction.
I filed bankruptcy in 2010ish..I never went through the process of paying the trustee and thus not discharged..As i owe them money likely.On top of that I owe like 300k in back taxes so can’t get dishrged apparently without paying backtaxes..But making like 60k a month it’s impossible.I don’t think there has ever been a case like mine in Canada..Any options besides getting a cardboard box to live on the street.I mean on the whole internet this has never been brought up.Have you ever heard of such a case??
Ty
Actually, your situation is not that uncommon. About 1 out of every 100 people that file for bankruptcy don’t complete the procedure so they remain “undischarged bankrupts” forever… To sort your situation out you need to start by contacting the trustee than originally handled your case to see what you need to do in order to be discharged now. You have to get the first bankruptcy out of the way before you can consider a second one to deal with the new tax debt. I should warn you, you will have to go to Court to ask to be discharged from the first bankruptcy and the Judge will ask if you intention is to turn around and file again. If you don’t do what you are supposed to in the second bankruptcy “bad” things may happen to you…
Hello in 2009 my husband and I went bankrupt
we had separated shortly after that we never completed our duties i never got any information on what I was supposed to do he got all of it never gave it to me I know the place of our trustee our file has been closed I don’t know what to do
Hi Barb. I suggest you contact the trustee. They can tell you what you need to do to get your discharge.
My partner and I filed for bankruptcy 14 years ago. We were deemed to have to make monthly payments but were in the process of moving to the UK, which we did a few months after filing for bankruptcy. When we moved our income significantly dropped and we never completed the bankruptcy requirements, although our trustee never contacted us for next steps, and we did just let it lapse. What is the next step for us now as we still permanently live abroad but wish to have the bankruptcy discharged. Thank you.
Contact the trustee you were dealing with to find out what needs to be done and to make the appropriate arrangements. If you don’t remember who the trustee was you may contact the Office of the Superintendent of Bankruptcy – they will be able to tell you who to speak to to resolve this. Since you are out of the country, you may want to hire a lawyer to look after all of this for you. Not required, but might be more efficient. Good luck.
Hi I am currently in a 2nd bankruptcy….I am paying a min of 1200/month and surplus in addition.I am a nurse and work overtime alot so some times I am paying 1800 to 2400 a month to my bankruptcy trustee….this seems really excessive……I understand about surplus income….but I never would have filed for bankruptcy if I knew the payments would be so high…..are there anymore options for me T this time?
You have the option of switching to a consumer proposal, either with your current trustee, or a new one. To determine if that makes sense you need to estimate what your total surplus costs is going to be, compared to your total unsecured debt, then offer your creditors a slightly better repayment in your proposal. The advantage of a proposal is the payments are fixed and spread over a longer period of time. The added benefit is that it would annul (cancel) your bankruptcy. Certainly worth looking into…
Hello I went into bankruptcy more that 8 years ago and did not fulfill my duty’s.I was not discharged. Does this mean I’m still in bankruptcy or am I back at square one and owe all the creditors?
It means you are still an undischarged bankrupt *ie you cannot file bankruptcy again). It also means your creditors have the right to pursue you for the amounts you owed them at the time you filed plus interest and penalties. In order to be discharged you’ll need to appear in Court and a judge will decide what to do with you. Before you schedule a hearing you should contact the trustee you originally dealt with and ask them for a list of things you did not do in your bankruptcy. At the very least, the Court will require you to complete all of your original duties.
I filed bankruptcy, but I didn’t do all my duties but paid my trustee in full, paid off my debt in full, except for my student loan that was listed but not removed in bankruptcy but I qm still making payments what should I do
If you paid off your debt in full you should apply to the Court to have your bankruptcy annulled (cancelled). Right now it probably shows as incomplete and it will stay that way unless you complete it or have the Court cancel it.