How does bankruptcy work in Canada?

Before you even consider or do anything, you need to meet with a licensed trustee. This is the person who's going to be overseeing just about every step of your bankruptcy process. Bankruptcy in Canada is a bit different than it is in the states. The public's common conception about bankruptcy is that poor people to do it to get out of debt. This is 100% wrong and doesn't actually fix the problem.

The first thing you need to do before you give away any assets or talk to anyone else, is to talk to a licensed trustee that is verified with the Office of the Superintendent of Bankruptcy. The trustee will then go through your financial situation to determine that you can even be eligible for bankruptcy and will help you find some consolidation alternatives.

Believe it or not, bankruptcy isn't the end or the only option. That's what trustees are for. Sometimes, you can be given consolidation advice or find another solution before taking the worst possible way out.

What Happens When You File For Bankruptcy?

If you've chosen the route to go with bankruptcy, several things are going to happen and your trustee will explain this process to you in detail. It's a step by step process that's followed and once the bankruptcy process begins, you will not have to deal with any creditors. The trustee deals with them on your behalf.

Step 1

The payments and annoying phone calls from the creditors will stop. This is the first thing that happens.

Step 2

Once bankruptcy is declared, you will no longer have any garnishments against you and your salary will not be touched.

Step 3

Finally, if you have any judgements or lawsuits against you by creditors, those will stop as well. Still, you have quite a few duties to maintain while you're in bankruptcy.

Your Duties During Bankruptcy

Duty #1

You have to give up your assets. If you have any liquefiable assets available, you will be giving them up. However, there are some assets that cannot be given up such as your essentials. You have clothing, furniture, etc. that will not be given to any collectors. If you own a car that you cannot afford, you will more than likely be persuaded to give that up as an asset to help pay off some debt.

This is why it's important to make sure you and your trustee go through all of your possible assets to determine what can and can't be given up that you own.

Duty #2

All of your credit and credit cards now belongs to the trustee. The Office of the Superintendent of Bankruptcy by law requires you to surrender all of your credit cards to the trustee in charge. If you have a credit card issued by an employer however, those cards are exempt.

Duty #3

You are required to attend counseling sessions on how to better handle future money you obtain so that this doesn't happen again. The first session has a time limit of 60 days to completion but you have 210 days to get the second session completed.

Duty #4

At the end of every month, you have to show valid proof and reports of your income and expenses. Bankruptcy is not an easy way out and it's not the end. There are far better and more viable options out there for people looking to file bankruptcy in Canada. Not everyone can even file bankruptcy, it's a process you have to be eligible for. There are consolidation options out there to work with your collectors and to work with any debt agencies you currently owe money to. Consult with a trustee before making the hard decision of going with bankruptcy, there are better options.

Additional reading

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The Canadian GDP Overview

In 2014, Canada had a GDP (which is short for Gross Domestic Product) of almost $2 billion. The GDP of Canada currently represents approximately 2.8% of the world economy.

Canada GDP had an impressive average of $580 billion all the way from 1960 up until 2014. The all-time low GDP for Canada was in 1961 with a staggering $40 billion and the all-time high was in 2013 with a shocking $1800+ billion. Who is in charge of reporting the GDP figures in Canada? The World Bank Group publishes the GDP annually.

Canadian Major Industries

There's quite a few industries in Canada that are booming right now and looking for prospective employees. Some of them are in industries you would've never thought of or probably didn't even know existed.

Industry #1 - Nonferrous Metal Foundry

The nonferrous metal foundry product production growth rate is expected to peak at 13% over the next five years. While the more broad metal manufacturers are struggling to make ends meet or just floating by unnoticed, the nonferrous metal production industry is experiencing an unusual growth but some experts believe that's only because of the recession recovery.

Industry #2 - Recycling

Over the next five years, it's predicted that recycling facilities are going to explode with a nearly 10% growth rate. This is partly due to the fact that in Canada, more Canadians overall are becoming more aware of environmental friendly alternatives to things that are harmful to the environment. Also, some advancements in cardboard such as the separators and other recyclable objects have allowed them to boost their production as well.

Industry #3 - Fertilizer Manufacturing

Over the next five years, fertilizer manufacturing is said to grow by 10%. The input prices constantly fluctuating certainly haven't helped but it's a very volatile market in general. There's also been some demand from other agricultural markets as well raising the need for fertilizer.

Major Banks in Canada

#1 - The Royal Bank of Canada

The Royal Bank of Canada is also known as the (RBC) and is Canada's undisputed largest financial providing institution. The Royal Bank of Canada has a firm grasp on the market as they hold steady at a capitalization of $85 billion. The bank has approximately over 80,000 employees and has 18 million customers (it could be 20 million in 2016).

The company was founded in Nova Scotia in 1864 but is now located with headquarters in Montreal, Quebec. Overall in Canada, there's 1,200 different Royal Bank of Canada branches that have a little over 10 million clients. In the United States, there's only 450 bank branches and an estimated 1 million clients.

#2 - Toronto Dominion Bank

The Toronto Dominion Bank (more commonly referred to by the initials of TD), is stationed locally in Toronto. TD may not be as large as the Royal Bank of Canada but still services a large chain across Canada for banking services and multinational financial services as well. While the Toronto Dominion Bank was officially founded in 1855, they didn't become the Toronto Dominion Bank until 1955 when they officially merged with the Bank of Toronto.

The Toronto Dominion Bank has an estimated $75 billion in market capitalization and is considered one of the top twenty banks in the United States. According to a recent study by Forbes on large banks, the Toronto Dominion is currently #19 in the world as the largest bank provider. There are over 85,000 people employed by the bank and approximately 22 million customers worldwide. With over 1,100 branches in Canada alone, the powerhouse serves 1 million people. In the US, there's over 1,500 branches and 7 million customers.

#3 - The Bank of Nova Scotia

The Bank of Nova Scotia is more commonly known to the people of Canada by Scotiabank. This is the third largest bank in Canada going by statistics of deposits. The market capital of Scotiabank is approximately $60 billion and operates in 50 countries around the world.