Published on December 2nd, 2009 | by Canadian Credit Expert0
Canada’s New Bankruptcy Laws
On September 18th 2009, several new bankruptcy laws took affect in Canada. In the interest of keeping Canadian’s up to date on important consumer credit and bankruptcy news, here is a brief break down of the changes to bankruptcy law in Canada:
- Surplus Income – Anyone making more than $200 above the monthly income limit is subject to surplus income rules requiring full bankruptcy payments for 21 months
- Multiple Bankruptcies – Anyone filing their second or greater bankruptcy is required to stay in bankruptcy for three years
- Consumer Proposal – The previous debt limit of $75,000 has been raised to $250,000 (excluding mortgage debt for a principal residence)
- Secured Lenders – Can no longer terminate a finance agreement because their customer has filed bankruptcy
- Income Tax Threshold – Individuals owing more than $200,000 in income tax, where that debt represents more than 75% of their total debt must go to court to receive bankruptcy discharge
These changes to bankruptcy law will have a significant impact on insolvent Canadians and will likely lead to a large increase in consumer proposals in Canada. One thing that is for sure Canadian trustees in Bankruptcy and consumers have Mixed Reactions to New Bankruptcy Laws. For more information on bankruptcy or consumer proposals, see our Bankruptcy Definition or Consumer Proposal Definition articles.
For more details on Canada’s new bankruptcy laws check out Bankrupt Car Loans news post Canada’s New Bankruptcy Laws – Bankruptcy Amendments in Canada.
Thanks and good luck from Any Bad Credit Canada.