Seven good reasons to consult a licensed insolvency trustee

There are many reasons to consult a licensed insolvency trustee. But before we go into it, let’s see what this professional’s role is.

What is a licensed insolvency trustee?

Formerly known as a bankruptcy trustee, the licensed insolvency trustee (LIT) is the only expert recognized by the federal government to help individuals and businesses free themselves of debt (beware if a company tells you they can help you get out of debt. Only an LIT can legally submit an insolvency file such as a consumer proposal or bankruptcy). Working in the interest of all parties, the LIT gives impartial advice. Once you make an appointment, they will analyze your financial situation to help resolve your indebtedness problems and ensure that your rights are being respected, while protecting those of your creditors.

When to consult an LIT

Everybody has temporary debt at some point in their life. But when the level of debt gets too high and turns into overindebtedness, the situation is not normal. This is when it becomes important to consult a professional. Here are seven good reasons for quickly seeking the help of a trustee :

1. Your debt problems are stressful and keeping you up at night.

Every time you check your bank, credit card or mortgage statements, you realize that the debt balance is decreasing much too slowly, or worse, is constantly increasing. From month to month, the situation is not improving. In fact, it seems to be deteriorating which stresses you out tremendously. You’re not sleeping, which makes you sick and in a very bad mood.

2. Your creditors are harassing you to repay your debt.

You used to get regular overdue notices, but lately, these have been turned into disconnection notices. Some of your creditors to whom you owe money are even trying to reach you by phone. So, you’re not opening your mail or answering the phone. This harassment is extremely stressful and you don’t know how to make it stop.

3. You were refused a debt consolidation by a financial institution.

Debt consolidation can be an excellent solution to indebtedness because it allows you to reduce your interest rate and combine all of your payments into one monthly instalment.

But sometimes, the bank or financial institution refuses to grant such a loan because it doubts that the person will be able to repay it (low income, too many debts, debt ratio too high, bad credit rating…).

4. You use one credit card to pay off another.

Credit cards are convenient when used properly. But because they have high interest rates, they are also a way to get into more debt when you can only make the minimum monthly payment. By limiting yourself to paying the minimum balance on your credit card, you are actually postponing the repayment of your purchases. And, you end up paying a lot more for them because of the interest. If you’re paying off one credit card balance with another credit card, the situation is alarming.

5. Following a separation or divorce, you can no longer pay current expenses.

You’ve just separated and now you have to cover all the costs alone. This can be difficult, especially in the current context of soaring prices.

6. You deprive yourself of essential everyday items.

Rampant inflation, combined with your debts, has taken a toll on your personal or family budget. You didn’t mind going without for a restaurant or a movie, but now you can’t fill your grocery cart to meet your daily needs. The situation is critical.

7. Your couple’s life is affected by the debt.

Your debt problems are on your mind all day long, but you don’t dare talk about them with your spouse, or when you do try to talk, it inevitably turns into a fight. Your spouse blames you for not being able to live at the same level as before. You feel so ashamed that you cut yourself off from your friends and family. The more the days go by, the more it weighs on you.

Do you have financial worries? Don’t hesitate to contact one of our licensed trustees. They will guide you each step of the way.