Before making a final decision to go that route, you should have a serious chat with a bankruptcy trustee. That trustee or an administrator will perform an assessment of your financial situation and present you with the options available to you.

If you decide to go ahead and declare bankruptcy, the trustee will help you complete the myriad forms necessary to complete the transaction.

One form is an "Assignment." In signing this, you state that you are handing over all of your property to the trustee for the benefit of your creditors. Another form is called the "Statement of Affairs." In this, you list your assets, liabilities, income and expenses.

These forms and others are then filed with the Official Receiver. If there is no opposition, the bankruptcy is discharged and you are legally bankrupt.

Your earnings are not, in normal circumstances, interfered with by the trustee.

As a condition of your financial status, you will be required to attend a minimum of two counselling sessions with a counsellor.

You have to pay a filing fee to the Office of the Superintendent of Bankruptcy (OSB). In addition, the trustee is entitled to be paid. These fees are prescribed by the Bankruptcy and Insolvency Rules which you can check out on the OSB's website at: http://osb-bsf.ic.gc.ca.

Who will know?
In a bankruptcy that involves significant assets, a notice is placed in the "legal notices" section of a newspaper, to alert creditors to the date of the meeting of creditors. But if there are minimal assets, the creditors are notified by mail. Credit bureaus are also advised of the bankruptcy, and it is noted in your file. All bankruptcies are public documents.

What are a bankrupt's obligations?
A bankrupt must keep the trustee informed about various developments over the course of his bankruptcy. For example, he must report on where he is living, and account for his earnings, living expenses and any changes in his family status.

When is a bankrupt discharged?
First-time bankrupts qualify for an automatic discharge nine months after they became bankrupt, unless the trustee recommends a discharge with conditions or the discharge is opposed by a creditor, the trustee or the Superintendent of Bankruptcy. In the event that you have been bankrupt before, your discharge will not be automatic and you'll need to go before a judge or a registrar to have it discharged.