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Declaring bankruptcy

What are your rights when dealing with your creditors?

Article updated on 15/10/2020
Are your debts piling up and your creditors getting impatient? That doesn’t give them the freedom to do whatever they choose. The practices of creditors and collection agents are governed by laws that exist to protect you. It’s important to be aware of your rights.


  • Creditors and collection agencies must adhere to very clear limits.
  • A bailiff can’t simply show up at your door at any time. Creditors (except governments) must have court authorization before they can seize your assets or wages.
  • When it comes to dealing with creditors, you have a number of rights, including the right to be notified in writing, the right to be informed with honesty and transparency, and the right to be treated respectfully.
  • A counsellor in financial recovery can put an end to harassment by creditors.

You have the right to be warned

If you default on a payment, a creditor must notify you in writing that you have 30 days to pay the amount owing.

Only after that timeframe can they institute legal proceedings and obtain a court judgment, which will enable them to call on a bailiff or collection agency to recover their money or have your assets sold. However, many of your assets cannot be seized by your creditors or a bailiff.

You have the right to be informed

It isn’t always easy to keep track of the remaining amount you owe a creditor. How many payments have you made so far? How many remain?

You have the right to request an account statement from a collection agency. You also have the right to demand proof of each payment you make. All of this should be absolutely free.

It can come in very handy to have proof that you’ve repaid a debt. For example, it’s useful if you want to correct information in your credit file.

You have the right not to be harassed

Being in debt can make you feel vulnerable. Creditors may try to take advantage of your vulnerability. Fortunately, there are limits that they must respect.

  • Collection agencies and creditors are prohibited from calling you without first sending you a notice in writing.
  • They are prohibited from contacting your family, friends or employer, except in rare situations.
  • They are prohibited from calling you at unreasonable hours.
  • They are prohibited from harassing, intimidating or threatening you.

Furthermore, you have the right to ask to be contacted only in writing, not by phone.

If you feel that your rights have not been respected, you can file a complaint with the Office de la protection du consommateur.

You should also keep in mind that one of the best ways to stop creditors from calling you is to ask for the assistance of a counsellor in financial recovery and Licensed Insolvency Trustee. Once you are officially covered by the Bankruptcy and Insolvency Act, your counsellor will put an end to the harassment you’ve been experiencing.

You have the right to honesty and transparency

When a collection agent contacts you, they must adhere to the rules below:

  • They must identify themselves and give you their permit number if you ask for it.
  • They cannot give false or misleading information.
  • They cannot ask you to pay fees other than legal fees or non-sufficient funds fees.
  • They cannot ask one of your loved ones to repay your debt unless they co-signed one of your loans or endorsed you.

You have the right to keep your essential assets

If you’re worried about a bailiff showing up and taking away all your things, you can rest easy. Your essential assets (e.g. furniture, clothing, work tools) and some sources of income (e.g. RRSPs, pension funds) are safe.

Your counsellor in financial recovery can draw up a precise list of your assets and income that cannot be seized by your creditors according to the law.

Examples of protected assets

  • Furniture in your home that is used by your family and is essential to their day-to-day life (e.g. appliances, television, furnishings)
  • Your clothing
  • Your food
  • RRSPs, RRSFs, RRIFs or any other type of retirement fund (except contributions for the last 12 months)
  • Work tools
  • Your car, if it’s essential to your work

Examples of protected income

  • Your social assistance income
  • Your employment insurance income
  • Your retirement pension under the Québec Pension Plan
  • Your Old Age Security pension
  • Any other benefit paid by the Canadian or Québec government

You have the right to seek assistance

Don’t wait until creditors send a collection agency to hound you. If you’re worried about your debts and you’ve been contacted in writing or by phone about a late payment, contact a counsellor in financial recovery and Licensed Insolvency Trustee.

The role of a counsellor in financial recovery and Licensed Insolvency Trustee is to help you find a solution your financial problems and take charge of communications with your creditors.

Meet with one of our counsellors for free

Don’t ignore a debt problem that’s ruining your life. Let’s work together to help you regain control of your finances.