what is a licensed insolvency trustee?

What is a Licensed Insolvency Trustee?

BankruptcyCanada.com

Table of Contents

• Page 3: Licensed Insolvency Trustee• Page 6: What is My Licensed Insolvency Trustee Responsible For?• Page 10: Learn About a Licensed Insolvency Trustee• Page 11: What Does a LIT (Licensed Insolvency Trustee) Do?• Page 14: Can I Trust a Licensed Insolvency Trustee?


Licensed Insolvency Trustee

• A Licensed Insolvency Trustee is an individual who has been licensed by the OSB (Office of the Superintendent of Bankruptcy) to administer to bankruptcy proceedings, including a consumer proposal.• You must use the services of a Licensed Insolvency T

rustee to file bankruptcy or make a consumer proposal.


http://www.ic.gc.ca/eic/site/bsf-osb.nsf/eng/home

https://bankruptcycanada.com/consumer-proposal/what-is-a-consumer-proposal/

https://bankruptcycanada.com/trustees1/




• A Licensed Insolvency Trustee is described by the OSB as:• “A Licensed Insolvency Trustee is a person licensed

by the Superintendent of Bankruptcy to administer proposals and bankruptcies and manage assets held in trust. The trustee can give a debtor information and advice about both the proposal and bankruptcy processes and make sure that both the debtor’s rights and the creditor’s rights are respected.”



• A Licensed Insolvency Trustee has their fees regulated by the government so the cost of going bankrupt will be the same regardless of which trustee you use.• Since your bankruptcy trustee is an officer of the court, they

do not directly work for you although they will ensure that your rights are protected when you go bankrupt.• Your bankruptcy trustee will also look out for the rights of

your creditors and will be responsible for administering your bankruptcy to ensure the process is fair for your creditors as well as you.


https://bankruptcycanada.com/bankruptcy-protection/

What is my Licensed Insolvency Trustee Responsible for?

• A bankruptcy trustee in Canada has many responsibilities; your bankruptcy trustee will be responsible for:• * Providing you with a free consultation so you can have your

financial situation reviewed, get answers to your bankruptcy questions, and get information on bankruptcy alternatives that could be available for you;• * Preparing the bankruptcy forms that are necessary to be

filed with the OSB to officially start your bankruptcy;• * Notifying your creditors that you have filed for bankruptcy;



https://bankruptcycanada.com/free-confidential-evaluation/


• * Gathering and validating your creditor’s claims about what you owe;• * Selling your property, except for those assets of yours that

are protected by the bankruptcy exemptions;• * Distributing any funds gathered from the sale of your assets

and holding the funds in trust for distribution to your creditors;• * Gathering your required bankruptcy payments and ensuring

that the funds are fairly distributed to your creditors;



• * Providing each bankrupt with the required bankruptcy counselling that is necessary to receive your bankruptcy discharge (only getting discharged from bankruptcy while release you from the legal obligation of repaying your debt);• * Collecting information from you during the length of your

bankruptcy that is required as part of your duties and necessary to calculate if you have any surplus income payments required;• * Administering your bankruptcy from start to finish;


https://bankruptcycanada.com/bankruptcy/discharge-from-bankruptcy/


• * Applying for your discharge from bankruptcy, which you will receive automatically after 9 months of being bankrupt in the vast majority of cases;• * If required, your trustee will hold a meeting of

creditors, at which your creditors can give the trustee directions and learn more about the causes of your bankruptcy and ask you any questions; you are required to attend your creditors’ meeting if it is requested, although this is a rare occurrence.


Learn About a Licensed Insolvency Trustee

• Bankruptcy trustees in Canada are licensed and regulated by the federal government.• If you are struggling with debt it is a good idea to seek

the assistance of a bankruptcy trustee as bankruptcy can be a complex (but straightforward) process.• If you file bankruptcy a trustee is appointed to your

bankruptcy estate and you will be guided through the bankruptcy process by your trustee.


https://bankruptcycanada.com/bankruptcy-process/

https://bankruptcycanada.com/bankruptcy-process/

What Does a LIT (Licensed Insolvency Trustee) Do?

• Your bankruptcy trustee will be responsible for guiding you through the bankruptcy process including:

• * Submitting all necessary paperwork;• * Dealing with your creditors;• * Selling your assets if they are not protected by the bankruptcy

exemptions in your province (most debtors going bankrupt will be able to keep all of their assets);

• * Distributing whatever funds they recover from the sale of your assets and distributing the funds to your creditors once your bankruptcy has finished (usually after 9 months). Your trustee will hold these funds in a trust during your bankruptcy.


What Does a LIT (Licensed Insolvency Trustee) Do?

• While a trustee in bankruptcy mainly provides assistance with bankruptcy and consumer proposals they can provide other services as a professional debt consultant such as:• * Help you avoid bankruptcy with a consumer

proposal;* Provide you with debt counselling;* Negotiate settlement agreements; and* Make deals with your creditors on your behalf.


Can I Trust a Licensed Insolvency Trustee?

• Yes. A licensed insolvency trustees are the only debt consultants who are regulated and licensed by the federal government and they also have a very strict code of ethics, are highly trained, have an accounting degree and university degree, and have completed a three-year bankruptcy course and were investigated by the RCMP before they received their bankruptcy trustee license.• Your trustee is an officer court (and therefore doesn’t work

for you) although they will always work to ensure your rights are protected and you are treated fairly.


Can I Trust a Licensed Insolvency Trustee?

• Your trustee in bankruptcy is also ethically required to advise you on how you can avoid bankruptcy if it is possible based on your unique financial situation.• Your trustee might be able to help you get out of

debt with no cost to yourself.• A mechanism is also in place to mediate any

disputes you have with your trustee.


what is a licensed insolvency trustee?

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