Debt Help in BC FAQs

Understanding Debt Help in British Columbia: FAQs

Debt Help in BC FAQsDealing with debt can often feel like navigating uncharted waters, especially when you’re not sure of your rights, the entitlements of your creditors, or the impact of a poor credit rating on your ability to secure debt relief. This guide seeks to dispel these uncertainties by answering some of the most frequently asked questions on Debt Help in BC.

Identifying Your Creditors

Who do I owe?

If you’re uncertain about who you owe money to, a helpful starting point is to request copies of your credit history reports from both Equifax Canada and TransUnion. You can get these online for a small charge or request them by mail for free.

How can I get my credit report?

In Canada, there are two primary credit bureaus, Equifax and TransUnion. Given that not all lenders report to both bureaus, it’s advisable to check with both. While you can conveniently access your credit history reports and score through their websites, this service may come with a fee. Alternatively, you can request free copies by mail.

Canada Revenue Agency (CRA) and Debt

Can the CRA put a lien on my house?

If you’re in arrears with your tax filings or payments, the CRA might take collection actions, which could include placing a lien on your home or other real property. Filing personal bankruptcy or a consumer proposal can halt such actions.

Can the CRA freeze my bank account or seize my wages?

Similarly, if you’re lagging behind in tax filings or payments, the CRA might resort to freezing your bank accounts or even garnishing your wages or self-employment income. Unlike most creditors, the CRA can initiate debt collection much faster and without a successful court application. Bankruptcy or a consumer proposal can also halt these actions.

Statute of Limitations on Debt

In BC, the Limitation Act sets various limitation periods, including a cap on the duration within which one can sue for a debt. This doesn’t prevent creditors from contacting you, sending you letters, or negatively affecting your credit score. BC has a basic two-year liability limitation period for consumer debt.

Licensed Insolvency Trustees (LITs)

What is an LIT?

In 2017, the professional title for Trustees in Bankruptcy changed to Licensed Insolvency Trustees (LITs). They are the only professionals in Canada legally empowered to help residents eliminate their debts using legal debt relief options like Consumer Proposals and bankruptcy. You do not need a referral to meet with an LIT, and debt consultations are free of charge.

What is the Office of the Superintendent of Bankruptcy?

The Office of the Superintendent of Bankruptcy (OSB) oversees all matters and filings related to the Bankruptcy and Insolvency Act, including bankruptcies and consumer proposals. LITs obtain their licensing from the OSB, which also regulates insolvency professionals and supervises the administration of insolvency estates.

Debt Help for Bad Credit

An LIT can provide debt help in BC regardless of your credit score. Traditional avenues like debt consolidation loans through a bank might not be available to you if your finances are stretched thin or if a poor credit history makes you ineligible to lenders. An LIT can help you with debt consolidation regardless of your credit rating, often through a consumer proposal, which legally consolidates and eliminates debt.

Spousal Debts

You are not responsible for your spouse’s debts simply because you’re married, cohabitating, or even in the event of their death. Co-signing or co-borrowing on debts or debts deemed ‘family debt’ following separation or divorce under BC’s Family Law Act may trigger responsibility for “spousal debt”. You should also understand that if your spouse can’t meet their repayment obligations, jointly held assets or assets transferred to you by your indebted spouse might be at risk. An LIT can offer various options to protect you and your assets and assist you or your spouse in paying off debts in an affordable way or having debts forgiven by creditors.


It’s important to remember that help is readily available. Don’t let your anxieties or uncertainties prevent you from seeking the help you need. If you’re dealing with debt, reach out to a qualified debt management specialist. They can provide the tools you need to make informed decisions about your finances.

If you have more questions about Debt Help in BC, don’t hesitate to reach out to a local BC Licensed Insolvency Trustee for a free and confidential debt consultation.

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