Myth #3: A Bankruptcy Trustee Only Does Bankruptcies

Category: Personal Bankruptcy

Sometimes, when we meet people for the first time they often tell us that they were nervous about calling a bankruptcy trustee because they’d heard conflicting information about what a trustee does and that they will be forced into filing bankruptcy if they talk to a trustee. Today I will cover one of the top bankruptcy myths about bankruptcy trustees in Canada.

Myth: A Canada bankruptcy trustee will only recommend you file bankruptcy. Bankruptcies are all they do.

Truth: When you meet with a bankruptcy trustee in Canada the first thing they will do is conduct a personal assessment of your situation. They will ask you a series of questions – how much do you owe, to who, how much income do you earn, are your wages being garnished etc. Once the trustee has a full and complete picture of your unique financial situation, only then will they make any recommendations. When doing so, your trustee is required to discuss all debt relief options with you. If there’s a viable bankruptcy alternative out there, we’ll tell you about it. We’ll let you know the pros and cons of each bankruptcy alternative so that you can make an informed choice yourself as to what you believe would be the best option to pick.

All trustees must abide by a strict code of conduct which requires them to tell you about all of your options. In fact, only a trustee is bound by this government rule. Debt consultants and credit counsellors are not bound by law the same way as a trustee in bankruptcy, so they only have to tell you about the service they offer (the services they make money from) even when an alternative option might be the better solution for you.

We believe honesty is the best policy – in fact, typically 7 out of every 10 people that contact us don’t need to file a bankruptcy or consumer proposal and we’re happy to show them alternate options to avoid having to work with us.

Most of the people that contact us do so because they heard our name from a friend or family member and that’s important to us because it tells us

  1. we must be doing something right and
  2. people who come to see us left our office feeling like they received good advice. 

If you talk to an agency or debt advisor about debt options and the vibe you get is that they are trying to sell you something, or do not seem to be disclosing all the necessary information, we recommend you get a second opinion before signing on the dotted line.

We know that the decision to seek help about your debts is not an easy one.  Today we discovered that a trustee in bankruptcy will provide you with all the information you need to look at all of your debt relief options.  The myth that if you see a bankruptcy trustee you will be told you need to file bankruptcy has been, in a word, debunked.

Best of all, contacting us to review your options is free with no obligation to you.  Contact a bankruptcy trustee in your area if you have questions about your debt.

Read about other common bankruptcy myths:

Myth #1: Everyone Will Know I Filed Bankruptcy?
Myth #2: Will I Lose Everything If I Declare Bankruptcy?
Myth #4: All My Debts Are Discharged In A Bankruptcy
Myth #5: I’ll Never Get Credit After Bankruptcy

Category: Personal Bankruptcy | Tagged in:

About Howard Hayes

Howard Hayes is a Licensed Insolvency Trustee and Consumer Proposal Administrator with Hoyes, Michalos & Associates Inc. in Cambridge and Brantford, Ontario. Howard has many years of experience helping clients deal with their debts and is happy to review all of your debt relief options.