What is bankruptcy and what art the benefits to the debtor?
Bankruptcy is a legal process, regulated by the Act by which you may be discharged from most of your debts. The purpose of the Act is to permit an honest, but unfortunate, debtor to obtain a discharge from his or her debts, subject to reasonable conditions.
When you file a bankruptcy, your assets are given to the trustee in bankruptcy who then sells them and distributes the money among your creditors. After declaring your bankruptcy your unsecured creditor will not be able to recover their debts from your assets.
JOINT ASSIGNMENT: It is also possible to file a “joint assignment.” A joint assignment allows to bankrupt, involved in a close financial relationship (e.g. husband and wife) to file for bankruptcy together with one file.
What is a Consumer Proposal?
A consumer proposal is an offer made by a debtor to his or her creditors to modify his or her obligations to them. For example, you may propose to your creditors that you will pay a lower amount each month, but over a longer period of time. Or you may propose that your creditors accept being paid a percentage of what you owe.