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Don’t sweat the debt

September 27, 2022

Debt levels are going through the roof, mortgage debt has more than doubled in many areas, Canadian adults have an average of about 4 bank issued credit cards each, and we are telling you “Don’t sweat the debt”.  There are always solutions to debt problems – not always ideal solutions but they do work.

Settlements:

Often, settlements can be made with collection agencies and creditor collection departments.  Settlements are usually based on lump sum payments – for instance if you owed $15,000 on a credit card the collector may discount a settlement to $10,000, if you pay it in a lump sum.

Consolidation Orders:

Small Claims Courts can make consolidation orders where you would make a single payment into court each month and the payments are shared equally among people or companies you owe money to.  Each of the creditors being creditors who have obtained judgements.

Credit Counselling:

Credit Counselling offers a solution whereby major lenders, banks, and credit card companies, will accept partial repayment (about 77 cents on the dollar after Credit Counselling commissions) in settlement of the debt owed.  You pay the Credit Counselling agency 100 cents on the dollar, without interest for some lenders, then they take their commissions, and the rest goes to the bank.

Consumer Proposals

Consumer proposals are the foremost option available under the Bankruptcy & Insolvency Act.  Consumer proposals can reduce your debts to pennies on the dollar – usually having you repay between 15% – 30% of the original amount owing.  Those figures are a guide as results vary based on each person’s individual situation.

Bankruptcy:

Bankruptcy should always be your last option; bankruptcy is a great option for people with middle income and few saleable assets.  Higher income earners or property owners may end up repaying more than they expect as the values of property or incomes shift upwards.

In any event, it is good to know that you do have options to solve challenging debt problems.  Don’t sweat the debt, let us help you find the right option to solve your debt problems.

Debt levels are going through the roof, mortgage debt has more than doubled in many areas, Canadian adults have an average of about 4 bank issued credit cards each, and we are telling you “Don’t sweat the debt”.  There are always solutions to debt problems – not always ideal solutions but they do work.