The decision to declare personal bankruptcy in Lethbridge, or Medicine Hat, or Saskatoon, or Winnipeg, or anywhere else in Canada is not an easy one. Contributing to the difficulty are the many myths that exist about what can happen to people who declare personal bankruptcy.
The myths abound – you’ll lose everything you own (not true); your spouse will be ruined (not true); you won’t be able to leave the country (not true) and two of the scariest – bankruptcy filers can go to jail and lose their jobs.
First, insolvency – which is nothing more than the inability to pay what you owe on time with what you currently make – is not a crime. There are no debtor’s prisons anywhere in Canada. However, the job issue is a little more complicated.
As a general rule you cannot be fired if you declare personal bankruptcy but there are exceptions. Some professional occupations that involve dealing with money have rules prohibiting people discharged from bankruptcy from performing tasks like managing trust accounts.
Some jobs that involve a variety of accounting functions have similar rules. Whether the employee who has declared personal bankruptcy is terminated or transferred to another job within the organization is up to the company.
The best way to determine if your job status might be affected by declaring personal bankruptcy in Lethbridge is to first check any available job descriptions and company employment requirements. If your company has a human resources professional you may wish to consult with that person. Licensed bankruptcy trustees know all there is to know about bankruptcy so a meeting with a trustee in the early stages of your deliberations over whether or not bankruptcy is right for you can answer that question.
Finally, if your job may be in jeopardy as a result of a bankruptcy declaration you need to know you have alternatives to filing bankruptcy. Generally speaking, most of these jobs that may have restrictions that impact bankruptcy filers are higher paying jobs. As such, people affected are more likely to have assets of value and higher incomes. As you may know, no one loses everything they own in bankruptcy but filers with significant assets may lose an uncomfortable amount. For them the ideal alternative is a consumer proposal, which would also be a way to protect your job if you are in an occupation that might be affected.
Consumer proposals are administered by the same professional debt consultants who manage bankruptcy filings – licensed bankruptcy trustees. A trustee will evaluate your situation and determine a monthly payment you can be realistically expected to maintain over a maximum 5 year period. The payment replaces your multiple unsecured creditor payments and is made directly to the trustee. To make the time frame, the trustee proposes to your creditors they accept less than the total they are owed. In most cases they are willing and even eager to do that as they stand to get back more of what they are owed than they would if you are forced to declare personal bankruptcy in Lethbridge.
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