Are you one of the many unlucky Canadians who have received phone calls from creditors promising to settle your debts? Or have you been intrigued by the TV and radio advertisements claiming a government program will reduce your debts if you call NOW? These ads and phone calls are from debt consultants (or telemarketers working for debt consultants). I’m sure these ads have peeked your interest as they can sound appealing, but who are these debt consultants?
Anyone can be a debt consultant. Anyone. They do not require a license or any training, which makes it easy for them to open their business and start collecting your money. They charge huge upfront fees and they don’t provide any legal protection from your creditors. They simply contact your creditors for you (which you can easily do yourself) and try to negotiate your debt. The thing is, they have no authority to actually negotiate with your creditors.
Believe it or not, many of them are simply an expensive referral service for bankruptcy trustees! When they finally come to terms with the fact tat they can’t help you, they refer you to a trustee in bankruptcy. Whereas, if you would have contacted a licensed trustee in bankruptcy from day one, you won’t make any payments until your proposal or bankruptcy is filed with the government.
Unfortunately in today’s market, it’s almost impossible for the average consumer to discern who they can trust. Debt consultants advertise very heavily and their websites seem incredibly genuine and authentic.
SO, who can you trust?
A licensed trustee in bankruptcy is part of a highly regulated industry. All of our trustees are licensed by the Office of the Superintendent of Bankruptcy, which is a division of Industry Canada, a part of the federal government. Our trustees have completed a number of courses and written exams to prove their competency.
Our licensed trustees in bankruptcy utilize the federal legislation and the Bankruptcy and Insolvency Act to help individuals make consumer proposals or file personal bankruptcy.
I’m not saying all debt consultants or credit counsellors are bad. We have actually partnered with some not-for-profit United Way sponsored credit counsellors who are members of the Ontario Association of Credit Counselling Services.
Since these agencies are true not-for-profit organizations they provide their services at little or no cost. Credit counsellors can help in following areas:
Debt Management Plan
When you come to our office you will meet with a licensed trustee in bankruptcy who will review your situation with you and help you to devise a plan to overcome your personal debt issues.