debtcare.ca

Category: Canadian Consumer Debt

  • Your Rights: Canada Revenue Agency Collections Policy

    debt careWith this year’s tax deadline long gone, for many individuals, the stress that comes with income tax filing is also long forgotten. However, if you are one of the many Canadians now stuck dealing with a tax debt, the stress may just be in its infancy, growing exponentially as the days pass and interest continues to accumulate. How well do you know the Canada Revenue Agency collections policy?

    Of course the Canada Revenue Agency has a right to their money, but that does not mean that you don’t have rights as a taxpayer. The CRA is a very powerful organization, and often that power means intimidation and fear – just know that you do have rights and can fight the CRA if you so choose.

    Taxpayer Bill of Rights. This is a set of rights established to protect the taxpayer when it comes to things like language, privacy, harassment, objections, etc. For example, if you feel as though you are being unfairly treated, you are able to file a formal complaint under the Bill of Rights. Intimidation is a tactic that often works, but largely because people are unaware that avenues for recourse exist.

    Here is a link to the CRA website and the Rights in their entirety:

    http://www.cra-arc.gc.ca/rights/.

    Additionally, when it comes to a tax debt, individuals are often not aware of the programs that exist to help fight CRA collection action, actions such as a wage garnishment, frozen bank account, or property lien. These collection actions can cause extreme financial hardship and getting them lifted can be a challenge. Some of these programs can also stop interest and penalties. For example, the Taxpayer Relief Program or even the Voluntary Disclosure Program may give you the chance to deal with what you believe are tax debts leveraged as a result of personal circumstances which prevented you from filing or impacted your ability to pay.

    Just remember, any negotiations you enter into directly with the CRA can have negative impacts long term; often in exchange for a repayment plan the CRA will require personal information, information that will later be used against you! The CRA will never voluntarily negotiate to reduce principal, and typically this can only be achieved through a consumer proposal or bankruptcy.

    If a CRA tax debt has you feeling anxious and overwhelmed, our advice is NOT to call directly to negotiate, but rather to speak first with a debt counsellor with the experience and knowledge that will help you protect yourself. Call DebtCare Canada today at 1-888-890-0888.

     

  • You Can Stop a Wage Garnishment in Ontario – Here Are Your Options!

    wage garnishment in OntarioWage garnishments impact thousands of people every day – and can come as a most unpleasant surprise for those individuals.

    Beyond the financial implications, a wage garnishment in Ontario can have serious consequences in other areas of your life. For example, if you work for someone else, once that individual receives a Notice of Garnishment regarding the wage garnishment, they will be fully aware of your financial problem and thus may view you in a different light. Responsibility and reliability may be questioned, and any company that required a credit check upon hiring may take this new information into consideration.

    If you work for yourself, especially with a small company, your reputation is important, but if your clients are receiving letters telling them to submit payment directly to the court, this could tarnish that reputation. The hassle may cause those clients to look elsewhere in the future.

    Once a garnishment is in place, is paying it off the only option? Perhaps not.  A wage garnishment in Ontario can often be stopped but this largely depends on who issued it.

    Here are a few of the most common types of wage garnishments in Ontario:

    1. Issued through the court – someone sued you, got a judgement and is enforcing it. Generally this can mean a loss of up to 20% of your earnings, and can only be stopped by paying the debt or making an arrangement with a creditor, by court motion, or by arranging a bankruptcy or consumer proposal with a debt counsellor.
    2. Issued by the CRA – the CRA does not need a court order, and can garnish up to 50% of your wages. If you are self-employed or on a pension this could be up to 100%. A CRA wage garnishment can only be stopped by: CRA’s consent or an arrangement, by arranging a bankruptcy or consumer proposal with a debt counsellor, or by taking CRA to tax court (the most expensive route). A CRA wage garnishment is particularly nasty….
    3. Issued by Family Responsibility – the only way to deal with one of these is to pay it in full or go back to court – there is no other option.
    4. Issued because of EI overpayment or by government after receiving money under false pretense – this can be complicated and these are instances where it is difficult to get protection. Like the CRA, this does not require a court order and if fraud is involved it can get tricky.

    When you are facing a garnishment of your wages, no matter the source, your best bet is to speak with a debt counsellor. The solution to your financial problem will largely depend on your personal circumstances, but ignoring the garnishment should never be an option.

    Avoid the embarrassment and financial hardship of a wage garnishment in Ontario by calling DebtCare Canada today at 1-888-890-0888.

  • In The News: Global News Talks Canadian Consumer Debt

    In a recent Global News release, the most recent Canadian consumer debt statistics were examined, and what’s been found might surprise you.

    According to the article, debt levels vary from province to province, and the spending trends vary with them. The article states that in the east, where consumers are less likely to be able to handle the financial burden, spending has increased; debt levels have increased, on average, 4%. However, in the more economically prosperous west, people seem to be dialing back.

    Ontario seems to be sitting somewhere in the middle. The articles notes, “Ontarians increased their obligations by more than 2.5 per cent in the second quarter compared to the same period a year ago, to $20,385.”

    Check out this infographic from Equifax which highlights the average for each province and how much that average has increased over the year.

    raw_ane_consumer-debt-levels-map-online

     

    Check out the full article here.

    For more about Canadian consumer debt levels or how to get a handle on your own debt levels, please contact DebtCare Canada today by calling 1-888-890-0888.

  • In The News: Canadian Consumer Debt

    Canadian Consumer DebtNo matter your situation, debt is likely something that you tackle on a regular basis. This may mean paying bills on time or, if the situation is a little more precarious, deciding which bills you are able to pay on time and which ones can wait. But debt, for the majority of Canadians, is a fact of life: Canadian consumer debt is often unavoidable.

    Check out this recent article from the Globe and Mail regarding the status of Canadian consumer debt levels: –       http://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/canadians-taking-on-more-debt-but-delinquency-rate-drops-report-finds/article20343607/.

    According to the article, “As of the second quarter of 2014, Canadian consumers owe $1.44-trillion, up from $1.42-trillion in the first quarter and $1.35-trillion a year ago, according to credit monitoring firm Equifax Canada.” However, although Canadians are taking on more debt, they seem to be better at paying it back: “The delinquency rate, which tracks bills overdue by 90 days or more, fell by 2.8 per cent.”

    For those in the position to make regular payments, on time, debt may not produce the same stressful effects as it does for those who are not in the same position. If your household debt levels seem to be a significant cause of strain or anxiety, it might be time to start thinking about making some changes. These changes may be something as simple as working out a strict budget or something as complex as a consumer proposal. Whatever the change, reducing your financial stress can be a great way to improve your overall well-being.

    As Canadian consumer debt levels rise, so too does the need to find effective means for debt relief. If you are in the same boat as those thousands of Canadians who struggle to maintain a strong hold on their debt, call DebtCare Canada today to discuss your options: 1-888-890-0888.

  • Not So Happy Canada Day When it Comes to Canadian Consumer Debt According to Yahoo Finance

    Canadian Consumer DebtLast week we celebrated Canada Day and that means that half of 2014 is officially over. Just like New Year’s Day, this holiday often leads people to think back on the past 6 months – have you evaluated your current debt load? Well, if you haven’t, Yahoo Finance has, and has discovered just how much Canadian consumer debt is impacting the nation’s economy.

    Check out this recent release from Yahoo Finance, “Household Debt Overhang Holding Back Canada’s Economy”: https://ca.finance.yahoo.com/news/household-debt-overhang-holding-back-124451782.html. According to the article, Canada was able to overcome the recent financial crisis thanks in part to consumer spending. A hot housing market and consumer spending meant that our economy was able to rebound far quicker than the U.S., but at a substantial cost. Now, thanks to high Canadian consumer debt, individuals are spending less and paying off more, meaning that economic growth won’t reach the levels initially anticipated.

    Furthermore, “Canada’s disposable household debt-to-income ratio is at a near-record high of 164.0 percent. By contrast, U.S. households reduced their indebtedness in the wake of the crash.” Clearly there are drawbacks to having dealt with the crash in a way that meant less economic meltdown for the average Canadian.

    If you are one of the many Canadians whose spending has led to a mountain of debt that now seems unmanageable, it might be time to start thinking about some viable solutions. Don’t get stuck barely able to make ends meet because of the interest on credit cards and the looming collection action being threatened by your creditors. Get in touch with a company today to find out what options exist to help you regain control of your finances.

    For more about Canadian consumer debt and taking back control of your money please contact DebtCare Canada today by calling 1-888-890-0888.

  • Statistics Canada: Report on Current Canadian Consumer Debt Levels

    Canadian Consumer DebtStatistics Canada released its latest report on figures regarding personal wealth and debt levels recently, and the numbers are not as promising as some financial experts would like – in many cases they are actually worse. What are these numbers, and what do they tell us about Canadian consumer debt levels?

    By the end of the second quarter of 2013, Canadian mortgage debt had reached $1.1 trillion – but this number is not included in consumer debt – or rather, debts such as credit cards or personal loans. In contrast, consumer debt reached a high of $500 billion.

    A key measure of consumer debt is the debt-to-income ratio for each household. This means the amount of household debt compared against disposable income. As StatsCan reported, the second quarter of 2013 hit a record high of 163.4% – that is up from 162.1% for the first quarter of last year, and is a reversal of the trend that saw the ratio decline in the previous 2 quarters.

    So what do these numbers actually mean? Well, according to financial experts, this is a good indication that Canadian households are still spending, on credit, but at a slower rate, which is a good thing. That being said, the key factor here is that the spending continues, meaning Canadian consumer debt levels continue to grow.

    Also, while some experts say that this debt is not unmanageable, a recent Royal Bank survey conducted by Ipsos Reid found that consumer debt is still keeping many Canadians on edge – 38% polled stated they were anxious about their current debt load. If you find yourself in this category you are clearly not alone. And although experts seem to think that Canadians are going to continue to curb their spending, this may not be as feasible for all as they would perhaps like.

    So, how do you measure up and what are your options? Are your debt levels on par with the average Canadian, or are you a bit more on the ‘stressed’ side. If your debt is keeping you up at night it might be time to think about a different solution. And again, you are not alone here either. The same RBC poll found that many Canadians are going a bit farther than just making a budget or using different tactics to decrease debt, stating debt consolidation has become a big favourite for many looking to reduce their overall debt load and save on interest.

    Want some help coming up with a solution – DebtCare can discuss the many options regarding Canadian consumer debt and how to eliminate yours. Call us today at 1 (888) 890-0888 or visit us online at www.debtcare.ca

  • Canadian Consumer Debt – How Do You Measure Up?

    Check out this great infographic from Royal Bank regarding consumer debt in Canada. Where do you stand?

    Jan 14 - Consumer Debt Infographic

     

     

     

     

     

     

     

     

     

  • The Globe and Mail Reports on Canadian Consumer Debt

    Canadian Consumer DebtThe Globe and Mail recently reported on the status of Canadian consumer debt levels, stating that Canadian household debt continues to grow. With that said, individuals seem to be obtaining less credit and the Bank of Canada reports being less concerned about this debt than in years past.

    However, a report from Statistics Canada calculated the average household debt at $164.97 for every $100 of disposable income, slightly higher than the analysis from 3 months previous. And just because the head bank doesn’t seem too concerned, it does not mean that Canadian consumer debt levels are not at a record high – they are.

    It has become quite common over the past several years to hear these reports about Canadian consumer debt levels no matter where you go. If you are not in debt often these updates seem irrelevant and are easily pushed aside. However, if you are in debt these updates can often leave you stressed about your own financial situation.

    If you find yourself getting shaky or stressed out with each report like this one, it might be time to recognize that you need some help with reducing your debt. Instead of trying to ignore the signs that your debt is becoming unmanageable or hoping that if ignored the problem might go away (it won’t), why not consider working with a professional to get rid of your debt.

    How can a professional debt consultant help? After an initial consultation which will involve assessing your debt, your re-payment behaviours, and your monthly income, a debt consultant will be able to discuss with you the various options which exist to help you get out of debt. They can also help you to establish a budget that is realistic while at the same time focusing heavily on repaying the money that you owe to your creditors.

    Some options which may exist include debt consolidation, consumer proposal or making settlements with your creditors. All three of these solutions come with their own benefits and it pays to consult with a professional to best determine which option is the right one for you. Some might even offer the ability to settle what you owe with creditors at a much lower amount – saving you money.

    If you find yourself constantly trying to avoid the reports on rising Canadian consumer debt levels, change your perspective and start looking at it as a motivator to get your own debt under control.

    For more information about how you can reduce your debt, please contact the professionals at DebtCare Canada by calling 1-800-890-0888, or visit us online at www.debtcare.ca.