Why Work With a Bankruptcy Trustee in Mississauga, Ontario

Your bankruptcy trustee in Mississauga, Ontario, will be your constant help in dealing with insolvency issues. These trustees are from independent and third-party offices that the Official Receiver appoints.

The Superintendent of Bankruptcies appoints an Official Receiver. To facilitate the bankruptcy process, they will assign you a bankruptcy trustee. You must work diligently with the trustee to achieve a more favorable outcome in court.

The trustees, or Licensed Insolvency Trustees (LITs) are well-experienced and licensed by the Office of the Superintendent of Bankruptcy. LITs perform various tasks, including collecting payments, monitoring the process, and assisting in court proceedings.

The Purpose of a Bankruptcy Trustee

It’s your bankruptcy; why do you need a trustee to do the work for you? Whether you have filed for insolvency or not, you must know that these LITs must be present in an ongoing case. They will make sure that each party involved in the case is treated fairly.

Trustees are expected to treat debtors with more understanding, but remember that they will always go for fairness. What’s excellent about LITs is that their roles can change depending on the bankruptcy proceeding you’re going through.

One thing to note is that LITs and lawyers are different people. Even though they help you with court proceedings and give you advice, the former will always choose the path that makes the bankruptcy process go smoother. LITs will focus on how to pay your creditors back and evenly distribute the payment to them.

Roles of a Bankruptcy Trustee

To understand bankruptcy trustees' roles, you must be familiar with them. It is crucial to know what responsibilities these trustees should have and what roles are beyond their power. Once you understand what the trustees can do, working with the one appointed to you will be easier.

1. Examining the Bankruptcy Petition of the Debtor

Before anything else, the LITs will have to look at your insolvency case. They will check what your petition includes and look into your financial situation. Prepare for an interview, since this is how the trustees will get the information they need from you.

After getting the information they need from you, LITs will still conduct their debt assessment. It’s to help you see the financial issue from another perspective and find the best solution for your situation.

Only a few experts will recommend going into insolvency to pay back your debts. Sometimes, a consumer proposal is better for the debtor and the creditor. However, in cases where there is no other choice, LITs will go through their research beforehand to help ease the burden on you.

2. Connecting With Creditors

Many debtors fear facing their creditors, and thanks to your bankruptcy being recognized, you no longer have to face them yourself. It will be the LIT’s job to talk to the creditors for you. Even in court, you won’t need to meet any of your creditors.

The LIT must reach out and communicate with your creditors for updates. Your trustee will be the one to inform them about the start of your insolvency proceedings. Apart from that, LITs also notify creditors of the results.

Regarding payment, the LIT will also handle your assets and evenly distribute them as payment. Depending on the case results, you will be handing over assets and compensation for creditors that are of priority.

3. Governing the Bankruptcy Process

When you have yet to learn how bankruptcy works, it can be challenging to understand what is happening. Thanks to your appointed trustee, they will monitor the case for you. Part of their job is to look out for sudden claims from the creditor’s side.

Some creditors will grab the opportunity to extort your money and push for more claims. The trustee has the power to stop this and review the situation. You can trust that the trustee will; treat you and the creditor fairly while the case is ongoing.

In addition, the trustee will also assist you with your ongoing obligatory credit counseling sessions. Debtors are usually advised to attend counseling and perform other mandatory duties under bankruptcy proceedings.

4. Preparing Your Documents

Once you’ve agreed on bankruptcy as debt relief, trustees will review your data and documents. They will ask you to procure essential files so that they can read them and further assess your financial situation.

Apart from that, trustees will also guide you on how to sign various documents related to your insolvency case. They will collect all the forms you must sign to push your case through court.

You can also trust your LITs to prepare your income statement, assessment certificate, and bankruptcy certificate. Leave the hard work to the experts and ensure you submit all the legal documents needed.

5. Submitting Your Bankruptcy Proposal

Trustees are also responsible for officially compiling and submitting your consumer proposal or bankruptcy. Your insolvency isn’t deemed official until the LIT has formally submitted it to the Office of the Superintendent of Bankruptcy. 

Once the office receives your paperwork, it marks the start of your insolvency process. You will then be granted legal protection from your creditors. That’s why it’s essential to constantly update your LIT on how fast you can complete your paperwork.

The earlier you collect your data and submit it to the LIT for checking, the better. Remember that your creditors will always go after you if you owe them money. However, when your bankruptcy is officially endorsed, they no longer have the legal right to harass you.

Why You Need the Help of Trustees

There are many benefits when you work with a trusted bankruptcy trustee. They are the experts who are already familiar with how insolvency works. Ask the LIT what to do and what to avoid during the process.

Understanding the bankruptcy process, how the assets are chosen, and which creditor is the priority will take time. You will need your LIT to explain these to you and make you understand why you must perform such actions.

One of the most crucial reasons you need to work well with the trustee is to gain fairness. You want the court's decision to be fair, so you must be open and honest about what information you provide your Bankruptcy Trustee in Mississauga, Ontario.