Bankruptcy & Your Home
For many Albertans, their home is their number one asset. The fear of losing your home is one of the most stressful feelings a person can experience. Fortunately, Alberta’s bankruptcy rules specify that you can keep up to $40,000 of equity in your principal residence. The amount gets reduced by your share of the home if you are a co-owner. You do not lose your home necessarily. Contact a Licenced Insolvency Trustee for a more comprehensive breakdown of your home equity and bankruptcy in Alberta.
Your Automobile & Bankruptcy
After your home, one of the most important assets you may have is your automobile. In Alberta, $5000 of equity in your vehicle is exempt. That means if you have a vehicle with more than the specified equity, you will have to pay the difference. Unsecured creditors cannot take this equity away from you when you declare bankruptcy. For example, if you owned a car worth $20,000 and owed payments of $10,000, you would have $10,000 equity. You would have $5000 of equity that is untouchable but would have to make up the other $5000. Contact a Licenced Insolvency Trustee to find out more.
Social allowance, handicap benefit, or a widow’s pension are exempt if they are separate from your other funds. It can be tricky, so your best bet is to call an expert.
Bankruptcy for farmers is different than for other people. The intent is to allow you to keep running your farm during bankruptcy. Up to 160 acres of land are exempt if your principal residence is on the land and is part of your farm. Over the next 12 months, any personal property necessary for your farm operations is also exempt from bankruptcy. Please contact an Alberta Insolvency Trustee for more details.