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What is the difference between a Licensed Insolvency Trustee, a credit counsellor, and a debt settlement business?

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What is the difference between a Licensed Insolvency Trustee, a credit counsellor, and a debt settlement business?
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What is the difference between a Licensed Insolvency Trustee, a credit counsellor, and a debt settlement business?
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Reviewed: 
April 17, 2017
Answer

Licensed Insolvency Trustees, credit counsellors, and debt settlement businesses, all offer financial advice. But they are very different.

A Licensed Insolvency Trustee is the only person who can file a bankruptcy or consumer proposal for you. A trustee can also give you financial advice and help you understand how to repay your debt.

Credit counsellors and debt settlement businesses can give you financial advice and information. They can help you make a budget and make plans to repay your debt. But they can’t file a bankruptcy or consumer proposal for you.

There are two different kinds of credit counsellors:

  • Non-profit credit counsellors
  • For-profit credit counsellors

Non-profit credit counsellors work with you at a low-cost or sometimes for free. But for-profit credit counsellors and debt settlement businesses charge you for their services.

The government of Ontario sets rules that all counsellors and debt settlement businesses must follow. Licensed Insolvency Trustees follow a different set of rules.

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