Debt Help & Advice Canada


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Signs that you’re heading towards financial trouble

Your financial health can be one of the most troubling and stress-inducing areas of your day-to-day life. It’s responsible for your quality of life, it impacts your relationships, and it guides the way that you take care of your family and the additional responsibilities that life throws your way.

When money matters get out of hand, it can often be through no fault of your own, however, it’s vitally important to take control of your budget and to get your finances back on track to avoid any unnecessary hardships and avoidable losses.

Help with debt is readily available, and you should never be afraid or too ashamed to seek it out. In the worst-case scenarios, it could be the difference between losing your home or your family, so isn’t it better to find out what help is out there before your circumstances become too bleak?

Most people will know when they’re stretching their resources further than they should be and an imminent battle to remain, or become financially solvent, is on the horizon. The sooner you’re aware that you’re slipping into difficulties, the sooner you can take steps to rectify the situation.

If you’re not sure whether or not you’re heading for financial distress, the following areas can help you recognise the severity of your situation.

  • Do you regularly feel stressed or anxious about your finances?
  • Do you run out of money before your next payday?
  • Do you repeatedly miss your bill payment dates?
  • Do you regularly fail to pay one bill in order to pay another?
  • Have you had any of your utilities cut off due to failure to pay for them?
  • Have you gone over your credit card limit, overdraft or other lines of available credit?
  • Can you only afford to pay the minimum amount required by your credit cards or other lines of monthly credit?
  • Are you continually juggling your debts from one credit card to another?
  • Is your credit card a regular source of financing instead of merely offering the convenience that it was designed for?
  • Have you ever used a cash advance on a credit card to pay the balance of another?
  • Have you started asking friends and family to lend you money?
  • Are your creditors chasing outstanding debts or passing them on to collection agencies?
Our specialist team of debt specialists are here to help you no matter what your circumstances are

How to deal with your debt

When you realise that your debt management is becoming a problem, it’s important to take action as soon as possible. The longer you put it off, the worse the problem will become. If you’ve only just started to miss some of your monthly payments, there are often simple steps to get you back on track. Getting help with your budget could outline where you’re spending money recklessly or needlessly, and it could also help you find ways to spread problematic payments and make them more manageable.

Examine your budget to determine the most troublesome areas

The first thing you should do is to make a hard copy of your full budget. Tracking your income against your spending and expenses will give you a clear view of exactly what costs you face every month, and also an idea of the regularity of additional unforeseen costs, payments and surprise spending. With a more realistic budget mapped out clearly in front of you, it may offer clear areas where you can cut back until your finances are less taxing, giving you a chance to clear some of the debt that’s likely to tip you over your threshold.

You should examine what each of your debts costs; by their interest rates and the total spend over their full terms. If you can clear the most costly debts first, it could afford you additional freedom in repaying the remainder.

If you’re not sure where to start then consider using a budget worksheet or a debt option calculator to create a clearer picture of your finances for yourself.

Alternatively, a professional advisor can help you to do this. They will also go through the many debt management options available and which of them are the most suitable solutions in your personal situation.

Do you qualify?

Example types of problematic debt

There are many types of debt, all with unique problems and management options. Some of your debts will be secured against assets that you could be in danger of losing, or by a co-signer who will become responsible for specific credit lines when they guaranteed to help you pay if you lose the ability to make the repayments yourself.

There are a variety of non-secure debt types too, and these are the most common means by which your spending can get out of hand.

Credit card debt

Overspending on a credit card is easily done and happens to many responsible spenders. You might be facing an emergency, whether it’s a problem to do with your home, an accident, car trouble or a family crisis, and if you don’t have the correct budget to cope with these additional surprise expenses the interest rates can add up to create more significant problems than where you started. Could you afford to pay an extra 20 to 30% on top of the original cost to solve a problem that was already beyond your budget?

The ‘buy now worry later’ facility of a credit card can too often lure spenders into a dangerous option of mounting costs over time.

Thankfully, there are methods to regain control of credit card spending. Depending on the severity of your case, a credit counsellor may be able to offer enough assistance to restructure your spending and help you pay off your balance. In more severe cases a Licensed Insolvency Trustee can guide you through the methods to be able to repay your debts that avoid the problems associated with additional interest and the stresses of collection harassment.

Mortgage debt

A mortgage is a secured debt, so if you start to miss your payments or struggle with your repayment schedule, then you are at risk of losing your home. Keeping a roof over your family’s head is one of the biggest worries you can face, so if there are options to reduce your debt in other areas to maintain a healthy schedule with your mortgage, it is imperative you make full use of them.

There are methods of reducing or removing unsecured debt that won’t impact your assets. If you think you’ve reached the point where you need to consider this kind of action, you should speak to a debt counsellor to find out which are the most appropriate options for you.

Payday loans

A payday loan is a short-term solution designed to get you out of a fix in a hurry. It’s a valuable resource if you know you’ll be able to pay it back in full on your next payday or if you have enough money coming your way from another income stream, but what many borrowers fail to see is the vast cost this line of credit can run up if allowed to get out of hand.

The interest rates on payday loans are some of the highest on the market, and the interest that amounts on the capital as it grows can create a spiral of debt almost impossible to get out of.

Student loans

Student loans are a standard part of paying for life and fees through college or university. For some individuals, life after their studies may not have allowed a simple and straightforward route into repaying their loan, and for these individuals, there are options available to help with their repayment difficulties.

A Repayment Assistance Plan entitles you to apply for a reduction in your student loan payments six months after completing your studies.

A Revision of Terms plan can extend your student loan term by up to 15 years. Your repayments would become much smaller, however, the total amount of interest you would pay over the longer term would be much greater.

A Consumer Proposal could be a suitable option for those owing student loan money over 7 years after their studies were completed. A proposal combines a range of unsecured debts into a single monthly payment and is an appropriate option of which to add and clear your student loan debt.

Bankruptcy is a final option when your total debts have become impossible to repay. Once again, your student loan must be over 7 years old to be added to the bankruptcy total debts tally. Bankruptcy should only ever be considered as a last resort when all unsecured debts have become completely unmanageable.

What debt solutions are available?

If you’ve made a solid attempt at managing your budget to see if you can get your monthly payments back on track and into a manageable situation, yet still don’t have enough money available to make all of your payments before you run out of money at the end of the month, then you need to consider alternative options to deal with your debt problems.

Formal debt control

Credit counselling

Credit counselling provides access to professional advice if you’re no longer in control of your debt. You will be offered information about the various ways they can manage your debt and if matters are too severe, the options that are available to simplify it and make repayments more manageable or to wipe the debts entirely.
A credit counsellor can help you set up a debt management plan, a consumer proposal or a debt settlement plan.

Debt management plan (DMP)

A debt management plan is a voluntary agreement between you and your creditors where your repayments are lowered to a manageable amount, often with a reduction or the removal of interest by your creditors. A credit counsellor usually organises this plan, and you are still liable to repay the total debt amount.

Debt settlement plan (DSP)

Organised through a debt settlement company, you will stop making payments to your creditors and instead makes payments to the debt settlement company with a view to building a lump sum in a holding account. You will grow your lump sum over a term of several months to an appropriate amount that can be used to negotiate the settlement of your existing debts for less than what you owe.

Debt consolidation orders and voluntary deposits

In some Canadian States, you can register for a consolidation order or voluntary deposit, to assist in making your debt payments. This can often be the case if you have concerns regarding wage garnishment or the seizure of your property.

Consumer proposals

A consumer proposal is an arrangement between you and your creditors where the total debt amount is reduced to a realistic amount that you can afford to pay. All legal action and collection harassment are stopped, and a Licensed Insolvency Trustee manages the proposal on behalf of all parties.

Bankruptcy

Filing for bankruptcy can clear most or all of your debts. As with other legal methods, collection harassment and legal action are stopped, and a Licensed Insolvency Trustee must carry out the process. Depending on your circumstances, you won’t always stand to lose important assets such as your home or vehicle. In many cases though, the equity in your property may be used, and valuable assets can be sold to help pay towards your debts. Bankruptcy should always be a last resort.

Where can I find help?

Talking to a professional debt management service should be your first point of call when matters are becoming too difficult to manage. They can advise you on your complete range of solution options, which ones are the most appropriate to your situation, and also organise a credit counsellor or a Licensed Insolvency Trustee where required.

Our debt help team will manage all cases with sensitivity and understanding. We appreciate how stressful and difficult a time this can be for our customers facing financial problems, and the process of regaining control or removing problem debts can be an on-going and lengthy struggle.

We are always available to listen and to let you explain your situation. We will offer constructive and cost-effective ways to manage your situation and arrive at your best possible outcome. On completion, whether it be full repayment or the removal of your debts, we will provide you with opportunities to understand how better to manage your finances in the future, to build a structured and healthy financial independence, which will include assistance with you’re your monthly budgeting, rebuilding your credit ratings and managing future debt sensibly in complete control.

Schedule a call with our team today to find out how we can help you.

How we can help you with your debt?

You’re on your way to resolving your debt problems, this is what will happen next.

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Fill out the form and arrange a call back with one of our debt advisors.
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We will then run through all of the options available to you and advise you on which is the best option for you
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We will then help you put the debt solution in place that will help you get back on track

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