What to Do After Bankruptcy in Canada: Starting Fresh With Ease
What to Do After Bankruptcy in Canada: Starting Fresh With Ease
Posted on June 16, 2022
Lots of Canadians find themselves in difficult situations through no fault of their own. One such situation is having filed for bankruptcy. While it doesn’t have the stigma it once did and is just part of life, it’s not a situation one would want to find themselves in voluntarily.
But it isn’t the end of credit though and that’s a good thing.
So, what happens after you've filed for bankruptcy? What comes next? Our Ayr auto loan team explains.
Bankruptcy and credit
Once the bankruptcy has been discharged, we imagine you’re feeling relieved and overwhelmingly positive. The calls stop coming, the letters stop arriving and everyone should now be off your back.
It’s a positive time. A time to reflect and renew and to start over.
Let start that right now.
Check your credit report
Checking your credit report is one of the first things we recommend doing after proceedings have completed.
Check with TransUnion and Equifax to make sure everything has been documented accurately and that all relevant accounts have been marked as closed or settled.
If you see any errors, contact the bureaus or the organization that made the entry and have it corrected.
Take note of your credit score while you’re there. You’ll need to know where you are now so you can tell if you are making progress in the future.
Work with your Licensed Insolvency Trustee
Your Licensed Insolvency Trustee will be responsible for filing your post-bankruptcy tax return. Make sure they have the information they need to file accurately if they haven’t done so already.
The last thing you want is the CRA chasing you for unpaid taxes!
Once they file the post-bankruptcy filing, it will be back to you to file your own taxes again. Make sure you stay on top of them!
Rebuilding credit after bankruptcy
Once you’re free and clear, your taxes are filed and you’re looking forward, it’s time to begin rebuilding.
Open a new bank account – Use a basic checking account capable of handling automatic payments and accepting salary payments.
Get a credit card – If your bank account comes with a credit card, get one. If you can qualify for a card, get one. Otherwise, use a secured credit card and use it regularly for everyday items. Pay it off in full each month but set up automatic payments for the minimum so you never miss.
Find a utility company or phone company that notes payments – Not all utility, cable or phone companies will note payments on your credit report so find one that does. Even if it’s slightly more expensive, the more entries you have, the more your credit score increases.
Get a bad credit car loan – When you’re ready, usually 6 months or more after proceedings have completed, consider a car loan. They will add more positive payments to your credit report and be part of your credit mix.
Rebuilding after you filed for bankruptcy is a long road but not a difficult one. Things have changed a lot and it’s no longer the end of borrowing it once was.
When you’re ready for that car loan, our team are always willing to help!
When you’re ready for a car lease or loan, get in touch with the Ayr auto loan experts at Northway Ford for great deals on auto finance.
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