What is a Trustee in Bankruptcy?
A Trustee in Bankruptcy is licenced by the Federal Superintendent of Bankruptcy (an Officer of the Federal Government) to administer
consumer proposals and bankruptcies. The Trustee represents your creditors and is an officer of the court. The Trustee's duty is to protect your creditors first, and you second. Trustees also provide financial counseling, debt management and handle negotiation with creditors Trustees administer consumer bankruptcies, and formal and informal proposals.
The Trustee will give you information and advice about both consumer proposals and/or bankruptcy processes. He/she will make sure that your rights, as well as those of your creditors, are respected.
Your Trustee will do the following for you:-
Evaluate your immediate problem such as total debt, collection problems, garnishees, judgements, creditor pressure
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Determine your overall financial situation and your ability to pay;
- Review your rights and responsibilities as well as what rights and responsibilities your
creditors' have.
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Provide you with options (i.e. managing finances better, budgeting, debt consolidation, orderly payment of debts, proposal to creditors and bankruptcy).
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Make sure you understand all of the options available
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Recommend certain options over others.
You should ensure that your Bankruptcy Trustee is fully qualified and accredited by the Federal Government's Superintendent of Bankruptcy
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Bankruptcy is a legal proceeding that is available to a person to cope with a financial crisis. One of the main purposes of bankruptcy legislation is to afford the opportunity to a person, who is hopelessly burdened with debt, to free himself of the debt and start fresh - "a new lease on life." To go into bankruptcy it is necessary for a person to be insolvent. To be insolvent means you:
- Owe at least $1,000;
- Are not be able to meet your debts as they are due to be paid.
What Will Bankruptcy Cost? Most Trustees in Bankruptcy will give you a free initial, confidential consultation regarding your personal situation and if you require they may set up monthly payment terms. Bankruptcy costs will be around $1300 for individuals, or about $2500 for couples, for a simple, basic bankruptcy with only exempt assets. A debtor will also be required to pay court filing fees of $100 and about $110 for each of the two mandatory counselling sessions.
How will you pay the trustee's fees? - Retainer, paid in advance, to the Trustee
- Monthly payments to the estate
- Income tax refunds
- Third party deposit with the Trustee
- Sale of assets before or during bankruptcy
- Any combination of the above
It is important that you obtain a clear understanding of what fees and payment arrangements have been agreed, prior to any assignment in bankruptcy |
ABSOLUTE MUSTS FOR YOUR FIRST MEETING WITH YOUR TRUSTEE: Discuss the items your Trustee will require for your assessment meeting to save time. Your Trustee must have the following documents and information to properly evaluate your situation.
You must provide all the needed documents in order to proceed with solving your financial problems
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Vehicles: Copy of vehicle registration
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Real Property: Copy of land title registrations and assessments
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Agreements: Copies of any security documents, such as mortgages, loan agreements, sales contracts, lease contracts, writs, judgements, garnishees, wage assignments, divorce, separation, and maintenance order(s), child support, alimony
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Life Insurance: Copies of all life insurance policies
- Credit Cards: All credit cards must be turned over to the Trustee, including those which may have zero balance.
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Stocks/Bonds/Sercurities/RRSP's: All pertinent documents/statements.
- Pay Stubs: Copy of last months pay stubs. If you are/were on EI please supply all stubs for current year.
- Income Tax Information: Copy of last tax return filed. If you have not filed up-to-date, please provide information for Trustee to file any previous years returns (T4's, Receipts, etc.). Any maintenance/child support payments.
- Two pieces of photo identification
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