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Tag: consolidate your debt

  • Getting Prepared: Consolidate Your Debt Long Before the Holidays

    debt2With the end of September fast approaching, that means the seasons are officially changing. It also means that the holiday season is only 3 short months away. If you are in debt, this can become a stressful time, very quickly. People often rack up considerable debt over the summer months, with family vacations and the like – but once the summer is over, it comes time to face reality once again, and for many that means dealing with that mountain of debt.

    Instead of continuing to put it off, why not establish a plan to deal with the debt sooner, rather than later. Use these tips to help get yourself prepared.-

    -Start with a budget. Look at your monthly payments, where you spend your money on a regular basis. An easy way to do this is with a budget template – one that includes all incoming and outgoing costs. Then think about where you can cut back. Perhaps you can eliminate some of the unnecessary expenditures, instead using that money to pay off your debts.

    -Look at the debt you have. How long have you owed the money, who do you owe the money to, and how much interest are you paying versus what is going onto those balances? Are you only making minimum payments and not actually paying down the debt?

    -Once you’ve examined your debt situation, consider your debt repayment options. Restructure debt if necessary – minimum payments don’t pay down debt.

    -Get a professional financial consultation to learn your consolidation options – while focusing on long and short term financial goals. Consolidating all of your debts may be easier than you think – and the various options available may actually save you a lot of money in the long run.

    -Start saving. With the money that will be required for gifts, why not start putting away a little bit every paycheque? You might be surprised at how much this will take from your shoulders come December.

    With the holidays coming up fast, make this the year you go into the season debt free. Eliminate the stress that this time of year can bring, and instead use it as a time to enjoy family and friends, without having to worry about what the New Year will cost you.

    Rather than racking up holiday debt and crying over those bills in January, why not come up with a financial plan now? Call DebtCare Canada today at 1-888-890-0888.

  • 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

     

     

     

     

     

     

     

     

     

  • Collection Agency Harassment: How to Stop the Calls

    collection agency harassmentCanadians have become so accustomed to carrying debt, and for some being in debt has become the norm. It is true that the vast majority of Canadians do have debt and when debt accumulates to the point where you are defaulting on monthly payments, the debt you have can be the source of considerable stress. This is especially true if your creditor has sent your debt to a collection company resulting in collection agency harassment!

    Collection agency harassment comes in many forms, but the most common is phone calls demanding payment for uncollected funds. These calls can come during the day, in the evening, on the weekends – when you are at home and at work. If you have been receiving these calls, or are nervous that they may begin in the very near future, it is best not to avoid the issue. The calls are not going to stop just because you don’t answer the phone – if anything they will increase in frequency. The collection agency may also pursue other methods to make contact with you that can be the source of embarrassment.

    In provinces like Ontario collection agencies are regulated by the appropriate ministry. In Ontario that ministry is the Ministry of Consumer Services (MCS). Reading your province’s legislation that deals with the regulation of collection agencies is your first step towards stopping collection agency harassment. If an agent called you at a time he or she wasn’t supposed to or disclosed information about you or your debt to a third party such as a family member or co-worker, you may file a complaint with the government to stop the collection agency harassment.

    Formulate a plan to deal with the debt. It won’t go away by itself and as long as it sits in collections it will accumulate very high interest, can be damaging to your credit and the collection agency will continue to pursue you. Speak with a financial consultant who has experience stopping collection agency harassment for help and also to learn about programs that can help you deal with the root problem – the debt itself.

    There are several very effective forms of debt relief in Canada, most common among them are debt settlements, consumer proposals, debt consolidation, mortgage refinancing and bankruptcy. All of these approaches have different benefits. While a consumer proposal can reduce your debt and freeze interest, it can also impact your credit in the short-run. While mortgage refinancing will enable you to rebuild credit faster, you will have to pay closing costs and interest to use your home equity to consolidate your debt. Only a skilled financial consultant can help you to review your options and help you choose the one that will best help you achieve your personal financial goals.

    If you are facing collection agency harassment it might be time to get the ball rolling and seek out debt relief from a professional organization experienced in dealing with collection agencies and helping individuals get rid of their debt. Get control of your debt – don’t let your debt control you!

    For more information about debt relief to stop collection agency harassment please contact DebtCare Canada today by calling 1-800-890-0888.

  • Dealing with Debt Part 3 – Divorce Debt in Canada

    Canada has the 8th highest divorce rate in the world. Human Resources Development Canada has reported that the proportion of marriages expected to end in divorce has fluctuated between 35% and 42% in recent years. In 2008, 40.7% of marriages were expected to end in divorce before the 30th wedding anniversary. In 2008, there were 70,226 divorces in Canada or 2.11 divorces per 1,000 people.

    Divorce debt in Canada is also very common. Human Resources Development Canada also reported that in 2008, 115,789 Canadians were unable to repay their debts. Serious financial difficulties brought them to file either a consumer proposal or a bankruptcy. Individuals who were divorced or separated were more likely to file a proposal or bankruptcy.

    Why is divorce debt one of the leading causes on bankruptcy in Canada? The answer is fairly simple. First, two income households will often accumulate debt based on their “household ability to pay the debt”. The challenge with this is that debt is accumulated based on two people sharing living expenses and when people separate, living expenses will double because now each party has to pay for rent or a mortgage, and living expenses separately. When household debt is present this can make it challenging to pay it.

    Second, some marriages will involve one person working and one person raising the family. When divorce occurs, the party who hasn’t worked will likely have little to no income but be faced with the immediate expense of having to hire a lawyer and also live. In many cases this forces the party who has been home raising the family back into the workforce. Individuals who have been out of the workforce for a long time often have to re-enter the workforce in junior or entry level positions.

    Third, sometimes one party in a marriage may carry all of the debt in his or her name. Much of the debt may have been used by the other spouse. There is nothing worse than getting a divorce and then finding yourself having to pay your spouse’s debt.

    Legal protections may result in the party who has the weaker financial positioning receiving support payments, being awarded the house, having the other party take responsibility for the debt, but this can take years. Also, the legal fees that compound over the course of a divorce may end up being more than the debt you owed to begin with.

    So how can someone in Canada who has divorce debt keep his or her head above water without filing for bankruptcy? Fortunately, if you are in this situation there is a solution and believe me you are not alone. There are financial programs for people dealing with debt and specifically dealing with divorce debt in Canada. These programs will often enable you to make a satisfactory arrangement with your creditors and will enable you to consolidate your debt payments into a single reduced monthly payment. These programs can be found through debt consultants who specialize in divorce debt in Canada.

    It is important if you are dealing with divorce debt to make responsible decisions that protect yourself and your family and also consider both your short term circumstances and long term goals.

    For more information about dealing with debt or to get help with divorce debt in Canada please visit www.debtcare.ca or call 416-907-2582.

  • Debt Consolidation Options in Ontario – We List the Different Types of Debt Consolidations

    In Ontario, when consumers or businesses finds themselves in financial trouble there are a number of financial options available to help deal with their debt. In this article, we list the different types of debt consolidation to help you understand which options are available to you if you are having problems managing your debt.

    Debt consolidation option number one – use your home to consolidate debt. If you have some equity in your home, it is a very effective choice for consolidating debt. Refinancing your first mortgage, taking out a second mortgage or a home equity line of credit will enable you to obtain low  interest financing to consolidate your debt. Mortgages enable you to amortize your monthly payments so you will often have more flexibility when negotiating the amount of those payments.

    Debt consolidation option number two – an unsecured loan or line of credit. Where this option is concerned, do lots of research. There are finance companies that offer unsecured consolidation loans at sky-high interest rates. Interest rates that are higher than what you may be paying on your credit cards. They may try to sell you on the benefit of a single monthly payment, which may be lower than what you are paying now – but this could cost you big time in the long run. If you cannot pay your minimum monthly payments any longer and your bank does not approve you for a prime rate loan or line of credit to consolidate your debt, take time to think about your choices before jumping into a high interest consolidation loan with a finance company.

    Debt consolidation option number three – credit counselling. Credit counselling agencies are not for profit organizations who obtain funding from the big banks. They will offer you a single monthly payment and pay your debts on your behalf. While you may think that you have received a debt consolidation loan because you are making a single monthly payment, this is not a consolidation loan. Your creditors will receive significantly less than what you owe and these credit counselling programs will cause major damage to your credit report. The repayment could be over 5-6 years and the credit counselling program will be reported on your credit report for 3 years from the date it is paid in full.

    Debt consolidation option number four – consumer proposals. Like credit counselling this is not a consolidation loan but many trustees in bankruptcy promote them as though they are because they involve a single monthly payment lower than what you have been paying on a monthly basis. They are a better choice than a credit counselling program because, if negotiated properly, they can significantly reduce the overall amount of debt that you owe. Like credit counselling, a consumer proposal will stay on your credit report for 3 years from the date it is paid in full, however, they do often offer shorter repayment terms. They also offer you protection from your creditors and will stop a wage garnishment or other enforcement option because they are federally mandated whereas credit counselling is not.

    How do you know which debt consolidation option is the right one for you? For starters, consider a debt consolidation the same way you would a big ticket purchase. This truly is an example of buyer beware, because when you go to a bank, finance company, credit counselling agency or Bankruptcy Trustee, their objective will be to sell you their products and services. When working with a financial consultant or debt counsellor you can determine the right option and obtain professional guidance to secure the best outcome.

    For more information about debt consolidation options in Ontario or to obtain advice with respect to your personal financial situation contact Michael Goldenberg at DebtCare Canada by calling 416 907 2582 or visit www.debtcare.ca