What is a Licensed Insolvency Trustee?

Nov 4, 2022 | Consumer Proposal

Written by C. Buhler & Associates Ltd.

Written by C. Buhler & Associates Ltd.

I’m Crystal Buhler, Licensed Insolvency Trustee with C. Buhler & Associates Ltd. I often get asked “What is a Licensed Insolvency Trustee?” You might also see the abbreviation “LIT”, and wonder what that stands for.

An LIT is a professional debt advisor. In fact, LITs are the only debt advisors that are federally licensed and regulated by the Canadian Government. Traditionally, those struggling to find good advice about dealing with debt have faced many options in the market, and not all of them are reliable. The federal government realized that the name “Bankruptcy Trustee” was scaring people, and pushing them away from those who legitimately provide solid, non-biased government programs to eliminate debt. To solve this problem, the government decided that bankruptcy trustees would be re-branded, and instead of being called bankruptcy trustees, we are now called Licensed Insolvency Trustees. We have found this change encourages individuals struggling with debt to approach a Trustee for reliable debt advice.

C Buhler & Associates Ltd. is a Licensed Insolvency Trustee with offices in Manitoba, Saskatchewan, Alberta and the Northwest Territories.

The LIT designation still requires the same rigorous training and education as before. To become a Licensed Insolvency Trustee, candidates must pass a comprehensive oral examination which requires extensive knowledge and experience.

Only individuals licensed through the federal government as Licensed Insolvency Trustees can file bankruptcies or consumer proposals in Canada on your behalf.

An LIT will:

  1. Meet with you before you sign to review your financial situation and help you find the best debt management solution possible. The role of a Licensed Insolvency Trustee is still to help you consider all of your options, not just bankruptcy, and we even discuss options such as consolidation and credit counselling.
  2. Collect information to prepare the required documents to be filed with the government.
  3. Notify your creditors, review all claims, and administer your file. For consumer proposals, that includes recording your creditors’ votes to determine if your proposal has been accepted.
  4. Ensure you complete all necessary duties and apply for your discharge or certificate, based on the type of process you’ve chosen.

It is important that the professional you work with is licensed, qualified, and properly trained to help you eliminate your debt, using a federally approved and legislated program.

There are a lot of different types of debt advisors in Canada. Here are 4 reasons why you should work with a Licensed Insolvency Trustee:

  1. Your initial consultation is free. Trustees offer free, no-obligation consultations to review your debt relief options. There is no fee just to talk with a Licensed Insolvency Trustee about your situation, and no referral is necessary. A consultation with a Trustee will not be reported on your credit bureau. You have nothing to lose by contacting us for advice.
  2. Trustee works for both you & your creditors, not just your creditors This is one of the biggest myths surrounding licensed insolvency trustees. A Trustee makes sure that your rights, and those of your creditor, are respected. They ensure that the process is fair everyone, & that everyone follows the rules. Sometimes, it feels a little like a referee.
  3. The proceedings a Trustee can offer protect you. When dealing with a Licensed Insolvency Trustee, you are protected. Trustees are regulated by the federal government and must follow a strict code of ethics. There is a mechanism in place to mediate any issues you might have with your Trustee. Only filing with a Trustee can provide a legal stay of proceedings, which protects you from your creditors, and can be used to stop wage garnishments and harassing phone calls.
  4. A Licensed Insolvency Trustee can guide you through the process. Filing a bankruptcy or a proposal to creditors can be a complicated legal process, and having a licensed Trustee on your side can help you manage it efficiently and quickly. Your trustee will answer all of your questions about how to file bankruptcy or how a consumer proposal works. Our goal is to make sure you are successful in receiving your discharge, or paying off your proposal, so that your debts are eliminated.

If you’d like our help to navigate to a future without debt, contact us today. Visit our website at debtfreenorth.com to connect with our team by phone, email or text. We look forward to working with you, and guiding you to your debt free future.

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