One of the benefits of filing for bankruptcy is the protection that you get from creditors that are aggressively pursuing their collections. The purpose of filing for bankruptcy is to get you back on track financially and if you are still dealing with creditors and their attempts to collect on your debt, that just can’t happen.
Automatic Stay of Proceedings
The most powerful protection you receive in the bankruptcy process is the automatic stay of proceedings. It can be a huge relief by putting a stop to harassing collection calls, garnishes on your wages, and other ways your peace of mind and finances can be crippled. Once the automatic stay is in place, any creditor attempting to collect on their debt is stopped. They are not allowed to foreclose, sue, repossess, or contact you regarding their collection. Creditors are only allowed to go through the Bankruptcy Court which gives you a little breathing room since they are not allowed to contact you through phone calls or letters. Under law, creditors have a list of behaviors that are prohibited and they are not allowed to bring suits against you. A Licensed Insolvency Trustee in Toronto will help you understand all of your rights under bankruptcy. Protection under the automatic stay is given to as soon as you file and lasts for as long as your bankruptcy does.
Relief from the Automatic Stay
It is possible for a creditor to ask for relief from the automatic stay of proceedings, however, they must apply to the Superior Court to grant this Order.
Bankruptcy vs Consumer Proposal
Declaring bankruptcy is not your only option and trustee firms in Toronto like David Sklar & Associates will typically work with individuals and businesses to find a better alternative. Usually, this means filing a Consumer Proposal – an agreement to pay a portion of the debt over the course of a number of years. Often, creditors accept these proposals in order to recoup part of the money they are owed, whereas they may get nothing in a bankruptcy situation. The majority of creditors must agree to a Consumer Proposal, but if they do, all will be bound by the agreement.
For more information, get your debt assessed by Licensed Insolvency Trustee, David Sklar & Associates, by completing a free debt assessment online. You can also use their personal bankruptcy services to help you get through financial crisis and start rebuilding your life. Often the goal of Trustees like David Sklar & Associates is to avoid bankruptcy and help you get out of debt instead.Corporate debt management is aimed at keeping your business operating, while a Division 1 Proposal can also help keep you in business. Licensed Insolvency Trustees will help you find the right way forward, whether its bankruptcy or keeping you in business while you manage your debt.