If you’re finding your debt hard to manage, you may have started some research to look at your options. That’s a huge and important first step, so good work! When weighing your options, you may have come across the term Licensed Insolvency Trustee (LIT).
LITs (formerly known as bankruptcy trustees) play an important role in helping you find the best solution to manage your debt based on your individual needs.
So, we spoke to Todd Howell, a LIT of 21 years, to answer all your need-to-know questions.
What is a Licensed Insolvency Trustee (LIT)?
A Licensed Insolvency Trustee (LIT) is a professional who is authorized to manage debt solutions and help individuals and businesses facing financial difficulties. LITs are regulated by the Office of the Superintendent of Bankruptcy (OSB), a division of the federal government. They’re there to listen to your situation, and help you find a solution that works best for you in a safe space and without judgement.
Becoming a LIT is a highly intensive career path, as individuals must meet specific qualifications and pass a rigorous licensing process. In fact, it took Howell 10 years to get his license from when he started in the insolvency industry.
Why do Licensed Insolvency Trustees exist?
“The insolvency system in Canada is governed and regulated by the Federal government, so for someone to access the insolvency system they must meet with a LIT,” said Howell.
What does a Licensed Insolvency Trustee do?
LITs play a crucial role in helping you navigate debt-related issues and your overall financial wellbeing. LITs at Farber Debt Solutions offer free consultations to assess your financial situation, and provide counselling not only for your debt issues but also for your broader financial picture.
“What’s important is your health, family, and relationships,” said Howell. “There are solutions, it just takes a bit of courage to reach out and get those solutions,” and reaching out is a step in the right direction.
Once the LIT has reviewed your specific situation, they’ll present your options over multiple meetings and provide guidance on what solution is best for you.
One such solution is a Consumer Proposal. It’s a legally binding document that can only be submitted by a LIT that can reduce your debt by up to 80%. We then work with you to determine a monthly payment that is reasonable and based on what you can actually afford.
“You remain in control of your property, whether it’s a house, investments or a vehicle,” said Howell. “It’s a settlement offer to the creditors greater than what the creditors would expect to receive in a bankruptcy, and people feel more comfortable because a lot of people want to pay something back – they just can’t pay the full amount.”
Why should you see a Licensed Insolvency Trustee if you’re struggling with debt?
If your debt has become too much to manage, the last thing you should do is take out a payday loan. With astronomical interest rates, choosing a payday loan is a temporary solution that will only make your situation worse in the long run.
“When you meet with a LIT, you’re already halfway to the end, and there are no fees to consult with us,” said Howell. “You can have your situation reviewed in detail and your options presented to you, you can take the time to make an educated decision.”
The bottom line
LITs are highly-trained professionals who can work with you to provide an affordable solution to reduce your debt. At Farber Debt Solutions, one of the LITs in Mississauga, there are many LITs just like Howell who can help you find the right solution, and judgement-free.
If you’re feeling stressed or overwhelmed by your debt, contact us today. We’re here to listen and give you the tools to help you feel confident and relieved that a solution for your debt is possible.