How to file bankruptcy with no money?

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Feeling strapped for cash and unsure about bankruptcy in Canada? You’re not alone! Filing can still be an option even if you’re asset-less, costing about $1,800 typically. Look into the Bankruptcy Referral Program for possible fee reductions. Thinking Consumer Proposal? You’re negotiating debt payments without big upfront costs. Always vet your Licensed Insolvency Trustee—some may not be trustworthy. Reach out via phone, text, or live chat if you have any questions.

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File Bankruptcy Question

How to file bankruptcy with no money? I need advice on what to do if I can’t afford the costs associated with filing for bankruptcy. What are my options?

From: Anonymous Question
Location: Saskatoon, Saskatchewan (SK)
Category: personal bankruptcy

File Bankruptcy Answer

Managing bankruptcy without any funds in your pocket can seem daunting, but don’t worry—it’s entirely doable in Canada. Even if you find yourself without assets or income, you still have the option to file for bankruptcy. Typically, the starting point for personal bankruptcy costs is around $1,800, which includes administration fees. If this feels like a mountain you can’t climb right now, check out the Bankruptcy Referral Program courtesy of the Office of the Superintendent of Bankruptcy. This nifty program might reduce some fees for you, though you might still need to shell out a bit. Oh, and keep an eye out for Licensed Insolvency Trustees (LITs) who could offer flexible payment plans. Just be careful—not all trustees are created equal, so choose wisely.

Let’s talk about another option: a Consumer Proposal. This is a formal agreement to repay a portion of your debt over time, and without a hefty upfront sum. A trustee is your ally here, negotiating with your creditors for you. And don’t forget about programs from credit counseling agencies, like debt management or consolidation. They’re great for reshaping your repayments and easing that debt burden. The golden rule? Chat with a licensed professional to explore the best paths suited to your situation. Just reach out—via phone, text, or live chat—for any burning questions you have!

From: Insider Adam

Office of the Superintendent of Bankruptcy (OSB) Answer

If you cannot afford the costs associated with filing for bankruptcy in Canada, consider the following options:

1. Reduced Fees: The Office of the Superintendent of Bankruptcy (OSB) allows for reduced fees under certain conditions. Under the Bankruptcy and Insolvency Act (BIA) Section 7.2, if your income is below a specific threshold, you may be eligible for a fee reduction or waiver.

2. Pro Bono Services: Some licensed insolvency trustees (LITs) may offer pro bono or low-cost consultation services. It is advisable to contact local LITs to inquire about any available assistance.

3. Payment Plans: Many LITs can establish a payment plan that allows you to pay the fees associated with filing for bankruptcy in installments rather than a lump sum upfront.

4. Consumer Proposal: If you meet specific criteria set in the BIA, you can consider filing a consumer proposal, which may cost less than a bankruptcy and is aimed at renegotiating your debts with creditors while still protecting your assets.

5. Legal Aid: In some cases, you may qualify for legal aid depending on your financial situation. Legal aid programs can provide assistance and guidance on bankruptcy filings, potentially at no cost.

6. Debt Management Counseling: Seek advice from a professional debt management agency. Some nonprofit organizations offer free or low-cost debt counseling which may help you explore alternatives to bankruptcy.

7. Prioritize Essential Expenses: If you choose to file bankruptcy, you may need to budget accordingly, prioritizing essential expenses to save up for filing costs.

Contacting a licensed insolvency trustee to discuss your specific situation and potential options is highly recommended.

From: OSB Helper

Related Questions to How To File Banruptcy

Here are the top 5 most frequently asked questions related to filing bankruptcy with no money, based on the provided sources and general trends in debt and insolvency inquiries:

1. How can I file for bankruptcy if I have no money?

You may be able to use fee waivers, reduction options, or programs like the Bankruptcy Assistance Program to help cover the costs[1][4].

2. What are the eligibility criteria for filing bankruptcy?

To declare bankruptcy, you must owe at least $1,000, be unable to meet your debt repayments, and your monthly income must fall below a certain threshold based on your household size[1][2].

3. Are there alternatives to bankruptcy if I have no money?

Yes, alternatives include consumer proposals, credit counselling, and debt management programs, which can provide different debt relief options depending on your financial situation[3][5].

4. How do bankruptcy fees work if I have no income?

If you have no income, you may need to pay the cost of bankruptcy up front, but options like using GST/HST credits or the Bankruptcy Referral Program can help cover these costs[4].

5. What happens to my assets and debts when I file for bankruptcy?

When you file for bankruptcy, a Licensed Insolvency Trustee will sell your non-exempt assets to distribute the funds to your creditors, and you will stop making payments directly to your unsecured creditors[2][3].

If you have a question about debt see our debt questions or ask your own debt related question.

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