F. J. Zielski & Associates’ Glossary on Financial Recovery

The process of financial recovery can be a confusing one and F. J. Zielski & Associates Inc. would like to help make it easier by offering a selection of definitions for various terms you may be involved with. If you require additional definitions, please feel free to contact us, and we will help you as much as possible. You can find us in Belleville, Kingston, and Trenton. You can also call for help in Cobourg.


Assets are any items of property you own that have value, such as a house, car, furniture, or cash.

Assignment in Bankruptcy

The formal term for “going bankrupt” is “making an assignment for the general benefit of creditors.” It is a legal process where the non-exempt assets of a bankrupt vest with the trustee, who in turn liquidates them to satisfy your debts with your creditors.


Bankruptcy is a legal process to allow someone with money problems to get a fresh financial start. When you declare bankruptcy, the trustee steps into your financial shoes and deals directly with your creditors.

Consumer Proposal

A consumer proposal is an alternative to bankruptcy, where you offer to pay your creditors a percentage of what you owe them over a specific period of time. It is a compromise of your debt, where by you are able to retain your assets. Generally, you would make monthly payments to a trustee, and the trustee will use that money to pay your creditors. The amount you pay depends on your personal situation and the amount of money you make.


A co-signer is someone who signs a loan with another person. Generally, the co-signer guarantees that if the person who signs the loan cannot repay the loan, the co-signer will repay it himself or herself.


The trustee must provide two counselling sessions to all individuals who file a consumer proposal or bankruptcy to help them understand the causes of their financial difficulties and provide financial guidance to help you avoid a future financial difficulty.

Credit Rating

Your credit rating is a history of all the money you have borrowed and owe. It shows if you have successfully paid your debts over time.


Creditors are people to whom you owe money.


A debtor is a person who receives a loan or an advance of goods and services in exchange for a promise to pay at a later date.

Unsecured Creditors

An “unsecured” creditor is someone who lends you money without "attaching" to any of your assets.

Secured Creditors

A “secured” creditor is someone who has "attached" to a certain piece of your property, such as your house or car, and have the right to seize that property if you do not repay your loan.

Stay of Proceedings

No creditor has any right or remedy against the property of a bankrupt, or may commence or continue any action, execution, or other proceedings, for the recovery of a claim provable in bankruptcy.


Equity represents the percentage of your assets that you personally own. For instance, if you have a mortgage on your home, the “equity” in your home equals the market value of your home minus the amount of your mortgage and applicable selling costs.

Exempt Property

Property which is either held in trust for some other person or declared exempt through provincial legislation, i.e. Ontario Executions Act.


A legal process where a creditor has obtained a judgment and the court has allowed them to seize your salary, money in your bank account, or other money you own to repay your debt.


You are considered insolvent if all of your property was sold at fair market value you would not have sufficient funds to satisfy all of your debts, or you cannot meet your obligations as they come due.

Official Receiver

The Official Receiver is a federal government employee in the Office of the Superintendent of Bankruptcy and an officer of the court with specific duties under the Bankruptcy and Insolvency Act.

Principal Residence

The home in which you (and your family) live most of the time. It can be a house, condominium, mobile home, or even a houseboat.

Surplus Income

Every year, the Superintendent of Bankruptcy publishes guidelines outlining how much money a bankrupt person is entitled to retain for living expenses. Fifty percent of any income over and above that amount must be paid into their bankrupt estate and is called “surplus income.”

Trustee / Trustee in Insolvency

A trustee, also known as a trustee in insolvency, is a person who is licensed by the Office of the Superintendent of Bankruptcy to administer the Bankruptcy and Insolvency Act. Trustees are strictly regulated and must keep abreast of current case law and directives.

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