You made the decision to deal with your debts. You met with a Licensed Insolvency Trustee, filed bankruptcy and plan to get your fresh start. So why are you still receiving calls from collection agents telling you to pay up?
Simple. They have not been informed of the filing yet. As you will read below, this is a normal situation where banks and credit cards companies do not phone and tell collection agencies to stop collection. Sometimes they find out from talking to you.
When you file for bankruptcy, you are protected from collection action, automatically. That means your creditors cannot take you to Court or garnishee your bank account, or worse, your paycheque (this is called a Stay of Proceedings). So why are you still getting calls and mail?
Most banks and credit card companies have large integrated centralized collection centers. Sometimes they hire someone to collect their debt, or they may have sold your debt to a third party. They are trying to collect on that debt and may not know, or have noticed, that you have filed bankruptcy. So there are a lot of parties involved and they don’t always communicate with each other. They also use third party service providers to submit all of their bankruptcy paperwork to the Licensed Insolvency Trustee. They tell us to send all documents to their provider. So the service provider knows even before the bank.
It could also be that they may have just received your information (if the debt was sold) and it was not up-to-date. They may even think if they just “bother” you enough you might still pay them. But don’t give in.
What do you tell the collector if you get a call?
If a collection agent calls you, talk to them and don’t be afraid. You have the protection of the Bankruptcy and Insolvency Act behind you. Here is what you should tell them:
- Advise them that you have filed a bankruptcy or a consumer proposal.
- Notify them of the date that you filed and the name of your Licensed Insolvency Trustee (provide them with our contact information)
- Give them the estate number (everyone who files receives a unique number).
- Ask them to contact your Trustee to confirm the information (sometimes a creditor will ask you to contact the trustee and have the Trustee call them. Get their contact details and any reference numbers and give that to your Trustee).
If you are getting mail regarding your debt, send that to your trustee so that they can contact the company to remind them of your bankruptcy and provide them with any documents that they may need. You may see additional charges after the date of bankruptcy including interest, overdraft charges, NSF fees and the like. You are not responsible for these charges as long as you are not using the account. It just takes a while for these institutions to do their housekeeping.
The hard part is over. As long as you complete all of your bankruptcy duties, you are on your way to getting your fresh start. Don’t stress if a collector calls. Let them know you’ve filed. Once all your creditors, and their agents, are up to date with the situation that should stop the calls. If it doesn’t contact your Trustee for help. It’s that simple.
Call us. It’s not too late. (604) 605-3335.