Imagine a 10 year old child wrapped in a blanket in his bedroom with his closest friend by his side. The only light is from the small flashlight illuminating his face. They’ve been taking turns telling tall tales to scare each other. There have been stories of vampires, werewolves and countless other mythical creatures.
But then the scariest story of all. It starts with, “Can you believe my mom and dad paid a debt consultant $3,000 when they could have talked to a trustee for free?”
Please pardon my Halloween indulgence. Debt consultants are a serious matter. New ones are popping up all the time offering to help you with your debts. The common scenario is that after you pay the “consulting” fee (of a few hundred to several thousand dollars), you are referred to a trustee in bankruptcy to file a consumer proposal.
The chilling part is that there is no need for you to pay that fee. You can contact a trustee directly for free unbiased information about how to deal with your debts. The other scary part is that, unlike vampires and werewolves, this story is real. It happens every day.
A consumer proposal may be the right choice. Consumer proposals are the number one alternative to personal bankruptcy for dealing with debt. Here are the primary benefits of a consumer proposal:
• Legal protection from your creditors (just like in bankruptcy)
• Wage garnishments stop (just like in bankruptcy)
• You get to keep all of your assets, like your house, car, investments, etc.
• Deal with your debts through one affordable monthly payment
Talking to a trustee is also the right choice since consumer proposals can only be administered by licensed trustees. The reason consultants “pop up” so frequently is that there is no government regulation over who can be a debt consultant. Think you know something about money? You could call yourself a debt consultant and open a business today. By contrast, a trustee in bankruptcy has to go through several years of education and training to receive a license from the government of Canada.
You work hard for your money. If you’re not careful, there’s no shortage of people willing to take it from you.
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