Some Lethbridge residents in financial trouble avoid taking immediate action to help themselves, believing somehow things will get better. More often than not, things get worse instead of better. Others start looking for potential solutions at the first sign of impending trouble. When looking at formal debt solution programs, one of the last things many residents think about is how long they take to complete. So how does the duration of a Lethbridge bankruptcy compare to non-bankruptcy solutions?
The fact is a Lethbridge bankruptcy is the fastest way to eliminate your debt and start over. Although there are negative consequences to declaring personal bankruptcy, no one should overlook the powerful advantage of the duration of a personal bankruptcy.
First, you should know a credit counseling solution can take 3 years or more to complete and a debt settlement plan can take 5 years. Although with both these programs your monthly debt repayment will be lower, it must be substantial enough to pay down the debt in the time allotted. Some Canadians who cannot keep up with the payments for such a long period default and find themselves facing bankruptcy anyway.
While you are enrolled in either of those programs, you are not eligible for credit. Once you successfully complete the program, you can begin the process of rebuilding your credit history.
If you declare a Lethbridge bankruptcy, the result is the same – no credit while in bankruptcy but you can begin rebuilding the moment you are discharged. The difference is the duration of these different debt solutions.
How long you remain in bankruptcy depends on whether you have filed before and how much you make. The government has established a threshold living allowance, depending on family size and location. If your monthly gross income is more than $200 over the threshold, a percentage of that surplus must go towards repaying your creditors.
In addition, surplus income increases the duration of your Lethbridge bankruptcy. If you have never filed bankruptcy before and you have no surplus income to contribute, you will be discharged from bankruptcy in 9 months.
First time filers with surplus income remain in bankruptcy for 21 months. In an attempt to discourage repeat filers, the government has increased the duration of bankruptcies throughout Canada for second time filers.
If you have declared personal bankruptcy before and have no surplus income, you will remain in bankruptcy for your second filing for 24 months.
If this is your second or third bankruptcy filing and you are required to contribute a portion of your surplus income, you will remain in bankruptcy for 3 years.
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