garnishing order

Do you need a lawyer for bankruptcy?

Posted on by Behdad Hosseini

 

Do you need a lawyer for bankruptcy?

Should you consult a lawyer before discussing debt and credit issues with a bankruptcy trustee?

A common misconception is that a bankruptcy trustee works for the creditors.

A bankruptcy trustee does not work for the creditors, but he also does not “work” for the debtor or bankrupt person.

A bankruptcy trustee in Ontario is appointed by the court to administer the bankruptcy.

The trustee’s job is to ensure that both the creditors and the bankrupt person follow the rules. A couple of examples follow.

The bankrupt must report his or her income each month, and to provide the trustee with information to file their taxes.

Here, the trustee makes sure all required information is provided.

Suppose a creditor tries to garnish the bankrupt’s wages after the bankruptcy starts. Garnishment is a drastic measure for collecting a debt.

It allows a creditor to take the property or wages of a debtor before the debtor gets possession of that property or income.

Garnishment is always made by court order. A garnishing order always requires that money is paid to the court. It’s never paid directly to the creditor.

Hence, the creditor’s actions are against the rules. So the trustee would seek a court order to stop that.

As the above situations exemplify, the bankruptcy trustee is the “middle man”, like a referee in a hockey game, making sure both sides follow the rules.

So the main question is:

Should you talk to a lawyer before you talk to a bankruptcy trustee?

The answer is: “Yes, of course”.

A lawyer works entirely for you, He or she can review your debt situation and advise you.

Also, bankruptcy lawyers usually have good working relations with several trustees and debt counselors. This relationship can work to your advantage.

We suggest that you first do your homework before dealing with a trustee.  Retaining a lawyer to assist you with your bankruptcy or debt reduction procedure is always highly recommended.

Article provided by Richmond Hill Lawyer

This post gives information only, not legal advice.

If you have a legal problem or need legal advice, you should speak to a lawyer.

For more information about debtor-creditor and bankruptcy law issues, please feel free to contact us.


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