When I meet with people in Windsor or Leamington to review their options, I am often asked “What does Bankruptcy cost?”
There are several components to the cost of Bankruptcy and I will attempt to summarize them here.
1. First there is the administrative charge. This usually starts around $180 per month and can last up to 36 months depending on your income and if you filed bankruptcy before.
2. Next is surplus income. In simple terms, the more you earn, the more you pay. You make this payment for either 21 or 36 months (or longer if you have filed bankruptcy twice or more before).
3. You have to make payments on any assets that are not exempt if you want to keep them. For example, if you have a car that is worth more than the exempt limit of $5,650, you have to pay the trustee the difference to keep the car. If the car is worth $6,000, you have to pay the Trustee $350.
4. Although not a payment, you also lose tax refunds for the year you filed and the year before if not already received the refund. You may also lose your quarterly HST credit cheques.
As you can see the cost of filing for bankruptcy is not always straight forward to figure out. Give us a call at 519-250-8060 or 310-PLAN and we can try and help you determine how much a bankruptcy might cost you.
About Rebecca MartynRebecca Martyn is a bankruptcy trustee and consumer proposal administrator responsible for the Hoyes, Michalos & Associates office in Windsor, Ontario.
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