financial counselling

Financial Counselling is Available

Many people struggle managing their monthly budget and could benefit from receiving financial counselling. Or in other words, a money coach. Financial counselling, sometimes called credit counselling, is available at our office.

There is no doubt that everyone’s life has been impacted by a coach at one point or another. That may have been a hockey coach, a dance instructor or some other personal pursuit. The vast majority of coaches are very helpful and can be looked back upon with good memories.

When it comes to your finances it can also be helpful to have a coach. Coaches can see things that you are doing that you might not notice. After you find out, you think, yes that makes sense and your situation improves.

Two Financial Counselling Sessions

If you file for bankruptcy or a Consumer Proposal, two financial counselling sessions are not only available, they are a mandatory component of the insolvency process. The counselling sessions must be completed at a LIT’s (Licensed Insolvency Trustee) authorized office that has been registered with the OSB (Office of the Superintendent of Bankruptcy). The Trustee, or an employee of the LIT, will have completed a Practical Course on Insolvency Counselling.

This ensures that the Insolvency Counsellor adheres to the high standards of ethics and professionalism with regard to carrying out the credit counselling functions with integrity, competence, honesty, and due care. Additionally, Counsellors are required to complete annual professional development training courses to stay current in all areas of credit counselling.

After each individual counselling session, you will be asked to sign the Report on Insolvency Counselling Session certificate, which confirms that you have attended and completed each session. This signed document must be submitted to the OSB. Without completing the two mandatory sessions, you would not be eligible for discharge from bankruptcy, or eligible for the Certificate of Full Performance, if a Consumer Proposal was filed.

Currently, due to COVID-19, the two sessions can be completed over the telephone with the counselling material provided by email or mail in ample time before the session. Otherwise, they can be conducted in person in a private setting with COVID-19 safety protocols in place.

The OSB has also implemented an online website where you can find modules on Budgeting and Money Management which you may find useful.

Accessing the online material on the OSB website is optional, however, highly encouraged and recommended.

First Financial Counselling Session

The First Financial Counselling Session is scheduled to be completed between 10 and 60 days following the date of when we started working with you. Consumer and Credit Education material will be reviewed at this meeting.

The counsellor shall discuss and provide advice in the following areas:

  1. Money management;
  2. Spending and shopping habits;
  3. Warning signs of financial difficulties; and
  4. Obtaining and using credit in the future.

The First Financial Counselling session is set early after the sign-up date. It is also the time to discuss any matters or concerns regarding the insolvency process. It may be the completion of Income and Expense summary reports, additional information or documents that may be required by the LIT, or creditors who are continuing to try to collect, etc.

It is our goal to assist you with the necessary guidance and information to make the insolvency process as understandable and non intimidating as possible, with the mutual end goal resulting in your Discharge from Bankruptcy or a Certificate of Full Performance.

Second Financial Counselling Session

The Second Financial Counselling Session is scheduled to be completed not before the end of a 30-day period after the first session and no later than 210 days following the date of when you started your insolvency filing.

Identification of Roadblocks to Solvency and Rehabilitation will be reviewed with you. This session is to determine the budgetary and/or non-budgetary causes of insolvency. Additionally, it is a good session to discuss any outstanding matters that may need to be addressed in order to stay on track to achieve your Discharge from Bankruptcy or Certificate of Full Performance.

The counsellor shall present information and assist you in the following:

  1. Follow up on the material presented at the first counselling session by discussing ideas to better understand your strengths and weaknesses with regards to money management and budgeting skills;
  2. Where appropriate, assist you to identify non-budgetary causes (such as gambling, compulsive behavior, substance abuse, unemployment and marital or family difficulties) that may have contributed to your financial affairs;
  3. To provide resource material that may help you to achieve and maintain economic stability;
  4. Develop recommendations and alternatives for a financial plan by discussing future goals;
  5. If required, provide referrals for specialized counselling to deal with the non-budgetary causes of insolvency.

Review and Improve your Credit Score

During the second session, we will also take time to review how you can take steps to improve your credit score.

You should expect that your credit rating will be affected. Equifax and TransUnion are the two credit reporting agencies in Canada. In a situation where you might have a dispute which you believe to be caused by the Bankruptcy or Proposal filing, you can complete the dispute form available from the two agencies and return it to their investigator. Equifax’s policy is to retain the note about your first bankruptcy on their system for six years after the date of discharge.

Future credit may be impacted when/if it comes time for a loan. The chartered banks usually have what they refer to as a “cooling off” period, in which they usually will not grant loans for 2 years after your Discharge from Bankruptcy or Certificate of Full Performance. During these somewhat volatile economic times, bank policies are constantly changing, so it is important to discuss monetary goals with your bank or credit union. Secured loans may be somewhat easier to apply for as they would have collateral against the loan.

The second counselling session is also an ideal time to discuss how to build a credit history. You can build a credit history by establishing:

  • A steady work record
  • The mandatory two financial counsellings are a wealth of information, and beneficial for helping you find a fresh start with your finances.
  • Open a chequing account and don’t bounce cheques;
  • Open a savings account and make regular deposits;
  • Apply for a small loan and use your savings account as collateral;
  • Apply for a secured or unsecured credit card.
  • Paying bills promptly

Contact Us – We are Here to Help

The financial counselling sessions are very helpful in keeping you on track to get a discharge and also to build good financial habits for your future. If you are looking for a fresh start with your finances, reach out to one of our convenient offices to schedule a free, complimentary consultation to discover your debt relief options.

Shirley Tomyn

I have been working in the insolvency field for over twenty years. Prior to joining Derek L. Chase & Associates I worked with a Campbell River based financial advisor and the Vancouver Stock Exchange. I look forward to the yearly professional development courses that promote increased knowledge in the insolvency field.