Declaring Bankruptcy In New Brunswick: A Guide

Declaring bankruptcy in New Brunswick can be a stressful process, but it can also be a helpful solution for those in debt. It's important to understand the steps involved and the potential consequences. Before declaring bankruptcy, individuals should gather their financial statements and evidence of debts, contact their creditors, and fill out court papers. While bankruptcy can provide a fresh financial start, it will negatively impact credit ratings for several years. It's also crucial to understand what assets can be kept and what will need to be surrendered to creditors.

Contact creditors

Before you can apply for bankruptcy in New Brunswick, you must contact your creditors. This means sending letters and emails to every creditor you owe money to. The process is largely the same for each creditor, but there are some differences depending on the amount of money owed and the age of the debt. If the debt is more than $350 and between 3-6 months old, you must send a letter through the mail. If the debt is more than $350 and between 6 months and a year old, send a letter before your filing date. If the debt is older than a year, send an email.

It is important to understand the rights of your creditors in relation to your own. You will need to provide financial details and a list of everyone involved, including the creditors. This could be from the beginning of the process or from recently submitted statements. It is crucial to mention how long they have held the debt and how much they are owed in interest alone. You should also explain how the debt is causing problems, such as poor work conditions and money troubles.

Once a creditor has paid, you will be able to file for bankruptcy. The trustee will then be able to collect any debts and ensure your creditors are paid as soon as possible. After declaring bankruptcy, you will need to contact the trustee for your case and the court itself. It is then a good idea to contact your creditors again and ask them if they will accept a few payments over time so that you can save money and repay your debts more quickly.

Court papers

To declare bankruptcy in New Brunswick, you will need to fill out a lot of documents and court papers. This process involves providing detailed financial information and a list of all creditors involved. This list can be compiled using recent financial statements, emails, letters, and other relevant documents. It is important to note that individuals must owe at least $1,000 in unsecured debts to be eligible to file for bankruptcy.

When filling out the court papers, it is crucial to include the duration of the debt and the total amount of interest owed. Additionally, it is advisable to mention any difficulties or problems caused by the debt, such as issues with work conditions and finances. Providing a comprehensive overview of the debt situation will strengthen your case.

The court papers will also require information about your assets, including their value and any debts or charges secured against them. This is important because, during the bankruptcy process, you may be allowed to keep certain assets, such as furniture, appliances, and tools, up to a certain value.

Before submitting your court papers, it is highly recommended to consult with a licensed insolvency trustee or a debt relief expert. They can provide guidance on the NB insolvency law, inform you of your rights, and help you understand the potential consequences of declaring bankruptcy. Remember, bankruptcy should be considered a last resort after exploring other debt relief options.

Once your court papers are in order, you will be able to proceed with the bankruptcy filing process, which includes working with a trustee and the court to resolve your debts.

Payment arrangement

Once a creditor has paid, you can file for bankruptcy in New Brunswick. The trustee will then be able to collect any debts and ensure your creditors are paid as soon as possible.

After declaring bankruptcy, you must contact the trustee handling your case and the court. It is advisable to contact your creditors again and ask them if they will accept a few payments over time so you can save money and repay your debts more quickly.

Before filing for bankruptcy, it is important to understand your rights and those of your creditors. It is also important to understand how much debt relief can help before making such a big decision. Although bankruptcy can save you a lot of money and give you a chance to start fresh, it is not the easiest thing to do.

Bankruptcy will impact your credit negatively for up to seven years or more, which is why it should be considered the last resort after other solutions have failed. When you file for bankruptcy in New Brunswick, you have to surrender much of what you own, which is not required when you fulfil a debt settlement plan or consumer proposal.

However, there are exemptions that allow you to keep some of your assets. These include furniture, household furnishings, appliances, food, clothing, fuel, necessary tools, equipment, books, medical and health aids, pets, and more.

Licensed Insolvency Trustees

When you file for bankruptcy in New Brunswick, you must surrender much of what you own to a licensed bankruptcy trustee, who will distribute it among your creditors. However, there are exemptions that allow you to keep some assets. Licensed Insolvency Trustees can help you understand these exemptions and ensure you keep what you are entitled to.

For example, in New Brunswick, you are allowed to keep furniture, household furnishings, and appliances to a total value of $5,000. You can also keep food, clothing, and fuel necessary for yourself and your family, as well as pets and necessary medical and health aids.

If you are considering bankruptcy, it is important to understand that it will negatively impact your credit score for up to seven years and that there are alternatives to bankruptcy, such as a consumer proposal. Licensed Insolvency Trustees can help you understand your options and make the best decision for your financial future.

Some Licensed Insolvency Trustees in New Brunswick include:

• MNP LTD
• Grant Thornton Limited
• Allan Marshall & Associates Inc.

Bankruptcy exemptions

When you file for bankruptcy in New Brunswick, there are certain exemptions that allow you to keep some of your assets. These exemptions apply to the equity in the owned asset, which is the value you own in property above any debts or charges you owe against the property. Here are the key bankruptcy exemptions in New Brunswick:

• Furniture, household furnishings, and appliances: You can keep furniture and appliances with a total worth of up to $5,000.
• Professional tools: Necessary tools, equipment, and books related to your trade or profession are exempt up to a total value of $6,500.
• Basic necessities: You are allowed to keep the fuel, food, and clothing that you and your dependents need for everyday life.
• Motor vehicle: If required for work, you can keep one motor vehicle with a value of up to $6,500.
• Health aids: Necessary medical and health aids are exempt from bankruptcy.
• Pets: You are allowed to keep pets belonging to you.
• Livestock and feed: You can keep a limited amount of livestock, including two horses, two cows, ten sheep, two hogs, and twenty fowl, along with six months' worth of feed.
• Retirement savings plans: Registered retirement savings plans (RRSPs), RRIFs, and DPSPs (Deferred Profit Sharing Plans) are exempt from bankruptcy.

It is important to note that these exemptions allow individuals filing for bankruptcy in New Brunswick to retain some of their assets, but there are still significant financial consequences to declaring bankruptcy. It is always recommended to explore other debt relief options before considering bankruptcy.

Frequently asked questions