How long does bankruptcy last?

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In Canada, first-time bankruptcy typically takes nine months without surplus income and up to 21 months if extra funds are involved. A second bankruptcy can last up to three years. Staying on track with tasks like financial counseling and payments is crucial to improving credit history and securing discharge smoothly. Beware though, not all Trustees can be trusted.

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Bankruptcy Duration Question

How long does bankruptcy last? How many years does bankruptcy stay on my credit history in Canada?

From: Anonymous Question
Location: Vaughan, Ontario (ON)
Category: personal bankruptcy

Bankruptcy Duration Answer

If you’re filing for bankruptcy for the first time and have no extra income, you’re typically looking at about nine months to wrap things up. Got a bit of surplus? That might stretch it out to 21 months. If you’re going through this a second time, expect it to take up to three years. Throughout this process, hitting the mark on certain tasks—like attending financial counseling and keeping up with payments—is key to smoothly getting discharged.

From: Insider Scott

Office of the Superintendent of Bankruptcy (OSB) Answer

In Canada, the duration of personal bankruptcy typically lasts for a minimum of 9 months if it is your first bankruptcy and you are not required to make surplus income payments. For subsequent bankruptcies, it can last longer, ranging from 24 months to 36 months if there are surplus income payments involved, as outlined in the Bankruptcy and Insolvency Act (RSC 1985, c 11, section 71).

Bankruptcy will remain on your credit history for 6 to 7 years from the date of discharge, depending on whether it is your first or subsequent bankruptcy (Credit Reporting Agencies). This is specified in the Canadian regulations concerning credit reporting practices.

From: OSB Helper

Related Questions to Credit History

Here are the top 5 most frequently asked questions related to the duration of bankruptcy in Canada, along with brief answers:

1. How long does a first-time bankruptcy last?

• Typically 9 months, but can extend to 21 months if surplus income payments are required[1][2][5].

2. How long does a second-time bankruptcy last?

• Can last 24 months if no surplus income payments are required, or 36 months if such payments are necessary[1][2][5].

3. What are the conditions for an automatic bankruptcy discharge?

• Must attend required financial counselling sessions, not be required to pay surplus income (or have made such payments), and have no opposition from creditors, the trustee, or the OSB[1][2][5].

4. Can bankruptcy duration be extended?

• Yes, it can be extended if the bankrupt is required to make surplus income payments, if financial counselling sessions are not attended, or if the discharge is opposed by a creditor, the trustee, or the OSB[1][2][5].

5. Do all bankruptcies require a court hearing for discharge?

• No, automatic discharges do not require a court hearing; only contested discharges do[1][2][5].

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

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