One subject I have not written too much about is bankruptcy. Fortunately, I have never had to file for bankruptcy myself, however I am aware of several people who have and it is also important to be aware of what financial options are available to us. Either way, it is a common topic that can be found in the same company as many other financial discussions and so I wanted to talk about the process a little bit, as well as the role a Bankruptcy Trustee can play in this situation.
While these types of roles may be somewhat different across various countries, in Canada, a Bankruptcy Trustee is an individual or group of individuals who help consumers with financial matters related to Bankruptcy. Some basic trustee duties may include, assistance with preparing and submitting documents to creditors, as well as setting up/or providing bankruptcy-related counseling services.
As mentioned, each year there are many individuals that will turn to bankruptcy as a solution to their financial difficulties. In cases of extreme debt, for various reasons that may include, job loss, large student loans, or even severe illness and injuries that have lead to the inability to pay bills – bankruptcy may be the next step. Regardless of these reasons, contacting a Bankruptcy Trustee may be a viable course of action.
Here are some initial consumer questions that can help individuals asses the need for filing for bankruptcy and contacting a trustee.
1) Are there alternative options instead of filing for personal bankruptcy?
As an alternative to bankruptcy, some individuals may choose to go the way of debt consolidation or work with a financial advisor to devise a management plan to combat high personal debt. There are options that can improve consumer debt, with bankruptcy perhaps as only a final resort.
2) What are the possible disadvantages of bankruptcy?
Filing for bankruptcy can have some negative implications for your financial situation. Some of the disadvantages of bankruptcy include:
• Negative effects on your Credit History (your credit history goes back to zero),
• Transferring some of your possessions over to a trustee many be necessary, and
• After filing for bankruptcy, you are required to keep ongoing records of all of your expenses and income in great length and detail.
3) What are the advantages of bankruptcy?
Just as there is a downside, there are also many advantages involved with filing for bankruptcy in Canada. For example:
• The act of Bankruptcy dissolves the unsecured debts of bankruptcy filers,
• The process itself, does not take very long and can be finalized rather quickly,
• Bankruptcy can be an inexpensive alternative to other debt management efforts, and
• Filing for Bankruptcy protects individuals from any legal action from collection agencies.
With all of this said, it may be that the time has come to contact a Bankruptcy Trustee for assistance. Alongside providing some answers to the questions above they can give you some advice on what to do and what to avoid once you file for bankruptcy. This can be useful and help you to build a stronger financial path.
Here is some more background information about the contacting a Bankruptcy Trustee.
When to Contact a Bankruptcy Trustee
While it may be that bankruptcy is a fairly quick process, it can actually be fairly complex. This is where trustees come in handy. Bankruptcy Trustees are licensed individuals who are trained in debt consultation. These individuals can help ensure that the bankruptcy process runs as efficiently and as smoothly as possible. Not only do they protect the right’s the the bankruptcy filer, but they also act as a mediator between the filer and the creditor. Overall, the trustee will transfer your assets to the appropriate channels. An example of this could be to sell your house and use the money to repay your creditors. Additionally, any other areas of income they can recover from your assets, will also be used to pay off your outstanding debts.
Even if you are not sure bankruptcy is the most appropriate option, speaking with a trustee can help you determine what course of action is right for you. They may again advise turning to other debt management strategies, such as debt consolidation before going down the bankruptcy route. It is also likely that your first consultation will be free of charge, so if you just want to examine your options to start, this is a valuable method that shouldn’t cost you any more money.
If any of this information is ringing true for you, contacting a Bankruptcy Trustee to find out more may just be worth your while. I also encourage you to gather more information about this topic and that way you can make the best decision you can and one that will help improve your financial situation.