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  • Facing a 2019 Mortgage Renewal? 3 Things You Need to Know

    In a month-and-a-half, it will officially be 2019. What will the future bring for you? If you’re anything like almost 50% of Canadian homeowners, it might bring a mortgage renewal.

    The Bank of Canada estimates that 47% of residential Canadian mortgages with Big 6 banks will be up for mortgage renewals in the coming year, with another 31% coming due in the next one-to-three years.

    This is significant because economists are already predicting something else 2019 will bring — higher interest rates and, in turn, higher mortgage rates.

    Since July of 2017, the Bank of Canada (BOC) has increased Canadian interest rates five times going from 0.5% to 1.75%. Experts predict that interest rates could reach 2.5% by 2020.

    Plus, the beginning of 2018 saw new mortgage regulations introduced, which dramatically affected the Canadian housing market, shifting supply and demand.

    If you’re facing a mortgage renewal in 2019, here are the three things that you need to know:

    1. Mortgage stress tests and house prices are keeping many out of the Canadian housing market.

    Mortgage Professionals Canada found that 100,000 Canadians have been prevented from buying a home due to new stress test regulations. Resale activity in Canada has fallen by 12.5% compared to 2017 and is down 16.5% from 2016.

    The homeownership rate in Canada is slightly down, too, from 69% in 2011 to 67.8% in 2018.

    If you are up for mortgage renewal and planning to move, this could mean that selling your current home may be more difficult. It could also be harder to find another house in a similar price range to move into.

    1. Interest rates are on their way up.

    In July of 2018, mortgage renewal rates were still fairly standard. Mortgage Professionals Canada found that the average five-year fixed-rate mortgage renewed at 3.32% (vs. 3.31% in 2013). The average five-year variable-rate mortgage renewed at 2.50% to 2.75% (vs. 2.73% in 2013).

    While this wasn’t much of a difference in July of 2018, the gap could grow in 2019. Canadian interest rates are continuing to increase. This could, in turn, affect mortgage renewal rates.

    And some homeowners have been getting much higher rates on renewal, depending on their lender and the length of their term. For instance, one homeowner who had a seven-year mortgage term spoke with CBC News in June of 2018 and said that he had been given a significantly higher rate on renewal (2011 vs. 2018).

    Plus, small fees can add up. CBC News did the math and found that on a $300,000 mortgage, even a tiny rate hike of an extra 30 basis points on a 25-year mortgage at a fixed rate of 3.74% for five years can add an extra $15,000 in interest costs over the entire life of the loan.

    That’s an extra $50 per month. On larger mortgages, the increase would be even more.

    1. Mortgage renewals aren’t exempt from the stress test.

    Borrowers do not have to undergo the mortgage stress test on renewal if they stay with their current lender.

    But if you are considering switching lenders to get a better rate, then you would find yourself being subjected to the test.

    The stress test requires the borrower to prove that they could afford their mortgage at either the average of what the big banks currently offer as their five-year fixed term, or two percentage points higher than the actual loan.

    For example, if you had a mortgage rate of 3.25%, you might have to prove that you could afford a mortgage rate of 5.25%.

    If you cannot pass the test at a federally regulated lender, the lender cannot give you the loan, which would either force you into a smaller mortgage and a cheaper home, or even out of the market altogether.

    Alternative lenders and credit unions do not have to follow the stress test rules.

    If your mortgage is up for renewal in 2019, starting to plan now for these eventualities will leave you more prepared.

    • Look at your current mortgage rate and compare to other rates on the market.
    • Take a hard look at your current finances and debt levels to see if you would pass a mortgage stress test.
    • Ask how a higher mortgage rate would affect you — could you afford it?
    • When it comes time to renew, if you decide to switch lenders, shop around. Know your options. It may be more cost-effective to choose an alternative lender or credit union.

    At DebtCare Canada, we can help you manage your debt and finances to make sure that you can pass a mortgage stress test.

    Contact us today for a free consultation. Call 1-888-890-0888 or visit www.debtcare.ca.

  • Free Digital Property Value Assessment: Know What Your Home is Worth Without Paying for an Appraisal

    With rising interest rates and a changing housing market, it pays to know exactly what your home is worth.

    This can help you determine your equity position, weigh your financing options, and much more.

    Many home assessment tools cost money, but ours is different.

    Our digital property value assessment is completely free and looks at:

    • Your property history;
    • Comparable property sales in the area; and
    • Estimated property value* based on data.

    No one has to come to your home – simply email mgoldenberg@debtcare.ca with your name, address, and contact information and we will generate your report and email it to you within two business days.

    It’s as easy as that!

    *The information included in the digital property assessment comes from a third-party source and we have no control or responsibility over its accuracy.

  • Latest Bank of Canada Interest Rate Increase: 1.75%

    The Bank of Canada (BOC) has made another interest rate increase.

    As of October 24, 2018, the BOC interest rate is at 1.75% — the highest it has been since 2008.

    The Canadian and U.S. economies, job growth, and inflation were all taken into account. The BOC also discussed household spending as part of their justification.

    “Households are adjusting their spending as expected in response to higher interest rates and housing market policies,” the BOC said.

    “In this context, household credit growth continues to moderate and housing activity across Canada is stabilizing. As a result, household vulnerabilities are edging lower in a number of respects, although they remain elevated.”

    Translation: the BOC believes that household debt is decreasing, and Canadians are spending less due to increased interest rates and new housing regulations, such as the mortgage stress test.

    They say that Canadians are taking out less credit and are able to afford the credit they do have.

    Of course, that may be true generally, but it is not always the case. Canadians may be taking out less credit, but they may also be struggling to pay off current debts.

    For example, if you have a high amount of credit card debt, your credit card interest rates will take a hit with the latest increase.

    If you had a credit card with a 20% interest rate before this raise, that would now be a 20.25% interest rate. A small hike, yes, but it could make a big difference.

    Apply that increase to all of your debt — can you afford the extra payments?

    And even if you can afford the extra payments, is that the best use of your hard-earned money?

    Whether you are carrying a high amount of debt, a low amount of debt, or want to take on more credit with a plan for repayment, we can help.

    At DebtCare Canada, we’ll help you build a plan for debt consolidation, credit repair, and more.

    The next BOC rate announcement is scheduled for December 5, 2018. The BOC said that more increases are on the horizon in 2019, and possibly sooner.

    Get in touch before then. Call 1-888-890-0888 or visit www.debtcare.ca.

  • Don’t Let the CRA Spook You – How to Stop a CRA Wage Garnishment

    With Halloween around the corner, we’re thinking about all of the scary financial situations that Canadians might face. And one of those that tends to spook people the most is a Canada Revenue Agency (CRA) wage garnishment.

    The CRA has broad garnishment powers. They can issue garnishments on your employment income, your bank account, and even other forms of income, like pensions. If you are self-employed, they can send requirements to pay to your clients. And unlike other creditors, the CRA doesn’t need a court order to garnish you.

    There are four ways you can stop a CRA wage garnishment:

    1. Pay the debt in full. If you can take out a loan or have home equity to access, this might be the time to use it.
    2. Get the CRA to agree to remove the garnishment. This is very difficult to do once collection action is in place. If you do attempt to negotiate with the CRA, you shouldn’t do it alone.
    3. File for a consumer proposal.
    4. File for bankruptcy.

    If you don’t have a sizable sum to offer or the ability to pay the CRA through a loan or home equity, then filing for a consumer proposal or bankruptcy will immediately stop a wage garnishment.

    So, what is the difference between a consumer proposal and a bankruptcy?

    Consumer proposals:

    • Are for non-mortgage debts up to $250,000.
    • Make a settlement offer to your creditors. The majority of creditors must accept this proposal for it to go through.
    • Typically, will not require you to give up any assets.

    Bankruptcies:

    • Are for any amount of unsecured debt. There is no limit.
    • May mean that you have to give up your assets.
    • Leave you with the worst credit rating possible — an R9.

    These options may seem extreme, but if you are faced with a CRA wage garnishment, they can be the better choice. The CRA will be aggressive with their garnishments and will not stop until they have recouped the full amount — plus any interest or penalties you have accumulated. This could mean thousands of dollars (or more) in garnishments by the time all is said and done.

    In turn, that could leave you struggling financially for months, or even years, on end. You need your employment income to pay your other day-to-day expenses, so having up to 20% to 50% of it (or more) go to the CRA could mean going even deeper into debt to other creditors.

    At DebtCare Canada, we can help you explore your options for stopping a CRA wage garnishment in its tracks. We will look at your credit rating, financial standing, and debt management choices to make the best plan of action.

    Contact us today for a free consultation. Call 1-888-890-0888 or visit www.debtcare.ca.

  • Pros and Cons of Refinancing Your Mortgage Before Renewal When in a 5-Year Term

    Refinancing your mortgage can be a great way to consolidate debt and ease your financial standing, but there is one important consideration to make: the timing.

    If you’re thinking of refinancing your mortgage before your five-year term comes to an end to access home equity, you need to consider the pros and cons.

    Pros:

    Accessing home equity through a mortgage refinancing can allow you to put your debts into one payment. You can pay off your outstanding, higher-interest debts with your home equity, and then pay off your mortgage loan through one, monthly payment — likely with a lower fixed-interest rate.

    Cons:

    If you are breaking your current mortgage before the current term is up, it may not be cost-effective.

    When thinking about using home equity to consolidate debt, you have to consider:

    • The rate your mortgage is currently at vs. the current mortgage rates.
    • Prepayment penalties.
    • The amount you owe on your current mortgage in proportion to your debt.
    • The amount of equity you have and your credit standing.

    Let’s look more at these.

    A. The rate your mortgage is currently at vs. the current mortgage rates.

    Is the current lending rate higher than what you are paying on your mortgage? If it is, then it may cost more in dollars and cents to increase your entire existing mortgage by 1-2% to pay down debt.

    Mortgages are usually much higher than what most people carry in personal debt. If you already have a good mortgage rate, then refinancing for a higher rate may not be the wisest decision. You could be paying more in the long run.

    B. Prepayment penalties.

    These can get quickly get expensive if you are refinancing before your mortgage renewal.

    These penalties could include:

    • Mortgage prepayment penalty (normally the equivalent of three months’ interest).
    • Mortgage discharge fee. If you are switching lenders, you may be charged this. Fees are typically between $200 to $350.
    • Mortgage registration fee. This is typically around $70 but varies by province.
    • Legal fees. This can vary widely, but are, on average, between $700 to $1,000.

    Be sure to look at your current mortgage contract to see what the terms are and consider what the penalties may be if you were to refinance early.

    C. The amount you owe on your current mortgage in proportion to your debt.

    Consider this example: you have a $300,000 mortgage at 3% interest and 15 years of amortization left on your mortgage. You also have $40,000 in credit card debt at 14% interest. You’re considering refinancing to a new mortgage rate of 5% over a 30-year amortization.

    On the plus side, you’ll be getting rid of your high-interest credit card debt quickly, but on the negative side, you will be making mortgage payments for far longer than you otherwise would have if the amortization schedule hadn’t been extended.

    If you refinance your mortgage and have to make higher payments each month, you also risk the danger of defaulting on your mortgage if you can’t afford the monthly payments.

    D. The amount of equity you have and your credit standing.

    Do you even qualify for mortgage refinancing?

    New mortgage regulations and changes in the housing market may mean that refinancing is going to be more difficult than you may think.

    All Canadians now have to pass a stress test to make sure they can afford their mortgage. If you are refinancing your mortgage, you may have to qualify at the higher stress-test rates rather than your existing contractual mortgage rate.

    And, if your credit is bruised, you may not be eligible for refinancing, or you may not have enough equity available in your home.

    Solutions

    If you have home equity but don’t want to refinance your mortgage, a secondary financing product may make more sense. It would carry the same benefits — one payment and lower interest than credit cards — but it wouldn’t impact your first mortgage.

    If you think you can’t refinance because you don’t have enough equity in your home, you can still likely consolidate debt using other financial avenues. A good financial consultant can educate and arrange these for you.

    At DebtCare Canada we can help you weigh your debt consolidation options, whether you are refinancing your mortgage, considering a secondary financing product, or otherwise.

    Contact us today for a free consultation. Call 1-888-890-0888 or visit www.debtcare.ca.

     

  • Thinking of Filing for Bankruptcy or a Consumer Proposal in Canada? You’re Not Alone

    Have you considered filing for bankruptcy or for a consumer proposal in Canada? If so, you’re far from the only one.

    Insolvency statistics show that bankruptcies and consumer proposals continue to be popular debt management options for Canadians throughout 2018.

    Here’s exactly how many Canadians are filing for bankruptcy or filing for a consumer proposal:

    2017 (Total Across Canada)

    Total: 125,807

    Bankruptcies: 60,669 (Personal Bankruptcies: 57,969, Business Bankruptcies: 2,700)

    Consumer Proposals: 65,138 (Personal Consumer Proposals: 64,229, Business Consumer Proposals: 909)

    Top Three Highest Provinces:

    Quebec – Total: 43,731, Bankruptcies: 24,210, Consumer Proposals: 19,521

    Ontario – Total: 39,045, Bankruptcies: 15,968, Consumer Proposals: 23,077

    Alberta – Total: 13,481, Bankruptcies: 5,139, Consumer Proposals: 8,342

    First Quarter of 2018: January, February, March

    Total (Canada): 31,327

    Bankruptcies: 13,863 (Personal: 13,163, Business: 700)

    Consumer Proposals: 17,464 (Personal: 17,234, Business: 230)

    Top Three Highest Provinces:

    Quebec – Total: 11,301, Bankruptcies: 5,664, Consumer Proposals: 5,637

    Ontario – Total: 9,507, Bankruptcies: 3,638, Consumer Proposals: 5,869

    Alberta – Total: 3,463, Bankruptcies: 1,227, Consumer Proposals: 2,236

    Second Quarter of 2018: April, May, June

    Total (Canada): 33,534

    Bankruptcies: 15,450 (Personal: 13,163, Business: 700)

    Proposals: 18,084 (Personal: 17,234, Business: 230)

    Top Three Highest Provinces:

    Quebec – Total: 11,109, Bankruptcies: 5,930, Consumer Proposals: 5,179

    Ontario — Total: 10,435, Bankruptcies: 4,202, Consumer Proposals: 6,233

    Alberta – Total: 3,884, Bankruptcies: 1,343, Consumer Proposals: 2,541

    Compared to the first and second quarters of 2017, the first half of 2018 is keeping pace. The total number of insolvency filings are slightly down, as are the total number of bankruptcies filed. However, the total number of consumer proposal filings are slightly up, indicating that more Canadians are choosing this option.

    If you are considering filing for a consumer proposal or for bankruptcy, it’s important to know the difference.

    Consumer proposals:

    • Are for unsecured debts less than $250,000 (not including mortgage debt).
    • Make a settlement offer to your creditors that the majority of creditors must accept.
    • Generally, leave assets intact.

    Bankruptcies:

    • Are for any amount of debt.
    • Clear most unsecured debts and potentially some secured debts, such as a mortgage or car loan, if the assets are seized.
    • Could result in losing assets, such as your home or your car.

    For more differences, see this blog: How is a Consumer Proposal Different from a Bankruptcy?

    Both consumer proposals and bankruptcies must be filed with a Licensed Insolvency Trustee (LIT, or formerly known as a Bankruptcy Trustee). However, they will take a portion of the fee that you pay. They aren’t necessarily ‘on your side’ — they are more of a facilitator for the process.

    Before you file, you need an advocate who represents you and only you. At DebtCare, we provide just that. We can represent you when filing for bankruptcy or for a consumer proposal, and we can also make sure you have eliminated all other debt consolidation strategies before filing.

    Contact us today for a free consultation. Call 1-888-890-0888.

  • TREB Has to Make Sold House Prices Public – What This Means for You

    An important court case involving the Toronto Real Estate Board (TREB) could have big benefits for consumers when it comes to sold house prices.

    For nearly seven years, TREB has been trying to keep sold house prices private — meaning only real estate agents or other mortgage professionals could access those figures.

    But on August 23, 2018, the Supreme Court of Canada turned down TREB’s appeal to keep home price data private.

    This means that consumers may be able to see historical sales listing data and prices online, whereas before that data was only available to real estate professionals.

    How does this affect the average consumer? It could be a big help. Consider the following:

    • With access to historical sales data, you’ll be able to see how much your house has sold for in the past.
    • You’ll be able to see how many times a house has sold in the past.
    • You’ll be able to see how much houses in your neighbourhood sell for to get an approximate idea of your home value.
    • If you’re considering putting an offer on a home, you’ll be able to see how much it has sold for in the past.
    • There will likely be greater competition and innovation in the Greater Toronto Area (GTA) real estate market, which could have a positive affect for consumers.

    This decision only affects GTA home data currently, but it may spread to other Canadian cities. Many real estate boards were watching the TREB court case to determine their own action. Now that a legal precedent has been set, it’s likely that other boards will follow suit.

    Similar real estate data has been available publicly in the U.S. for the past 10 years.

    As Canadian interest rates increase and new mortgage stress test rules are in place, it’s more important than ever for homeowners or potential homebuyers to understand the real estate market. This could help you decide whether you should keep or sell your home.

    Time will tell how exactly the court order plays out, but we are calling this a victory for consumers.

    Interested in buying a home or selling your house? DebtCare Canada can help. We offer first mortgages, second mortgages, home equity loans, and more.

    Contact us today for a free consultation. Call 1-888-890-0888 or visit https://debtcare.ca/.

  • Should You Get a Home Equity Loan to Pay Off Debt Before Interest Rates Increase Again?

    How confident are you that you could survive another Canadian interest rate increase? If your answer is “not very” perhaps it is time to consider getting a home equity loan to pay off debt.

    Since July of 2017, the Bank of Canada (BOC) interest rate has increased from 0.5% to the current 1.5%. Although the BOC held off on increasing the rate again in September of 2018, economists speculate that rates could go up as soon as October 24, 2018 — the next scheduled BOC announcement.

    Throughout the remainder of 2018 and 2019, experts predict that interest rates could reach as high as 2.25%. If that happened, would you be able to cope?

    Increasing interest rates affect all forms of unsecured debt — credit cards, lines of credit, unpaid bills, variable-rate mortgages, and more. Even some secured debts, like a fixed-rate mortgage, could be affected when it is time for renewal as Canadian mortgage rates have also increased along with the interest rate.

    This means that if you owe $10,000 on a credit card and are paying 1.5% interest, you would owe $10,150 with the interest calculated. However, if the interest rate were to increase — say to 1.75% — you would owe $10,175.

    That may not seem like much of a difference, but credit card interest rates are rarely that low, so you may be paying even more in interest. In that case, even an extra $25 could be a big burden. And many people have more than $10,000 worth of debt. Some have hundreds of thousands worth of debt; 1.75% interest on a debt of $100,000 would be an extra $1,750.

    Plus, the longer it takes to pay off a loan, especially one like a credit card debt without a repayment schedule, the more interest you will be charged. Imagine that extra $25 multiplied by 12 months — suddenly you would be paying $300 more during the year than you otherwise would have. Even if you can afford it, couldn’t that money be put to better use elsewhere?

    The solution is to deal with your debt before interest rates increase again. And you may just be standing on a way to pay it off — literally.

    If you own a house, you could potentially access financing to pay off your outstanding debts by taking out a home equity loan or refinancing your mortgage. You would likely be left with one monthly loan that you would have to repay, but you would have a fixed-interest rate. This way you would know exactly what you have to pay every month, so you could plan for the expense.

    Some debt consolidation options available through your home equity include:

    By consolidating debt through a home loan or mortgage refinancing, you could protect yourself against future interest rate increases and make sure you stay financially well no matter what the BOC decides.

    At DebtCare, we offer one of the most competitive financial programs to help people no matter their credit or income. Bad credit? No problem. Self-employed? No problem.

    Contact us today for a free consultation to find out more about using a home equity loan to pay off debt.

    Call 1-888-890-0888 or visit https://debtcare.ca/financial-products/.

  • Bank of Canada Prime Interest Rate Staying the Same for September 2018

    The Bank of Canada prime interest rate is remaining at 1.5% for September 2018.

    On September 5, 2018, the Bank of Canada (BOC) announced its decision to keep rates the same, referencing high gas prices, uncertain trade policies, and a stabilizing housing market.

    Canadian interest rates have increased four times since July of 2017, going from 0.5% to 1.5%. The last hike came in July of 2018.

    Interest rates affect all forms of non-fixed (variable) debt. This might include unpaid bills, lines of credit, variable-rate mortgages, and, of course, credit card debt.

    Credit card interest rates already tend to be very high — much higher than many loans. Added BOC interest rate increases would only bring that amount up more.

    Equifax Canada estimates that Canadians carry $599 billion worth of non-mortgage consumer debt, including credit cards, auto loans, and the like. They predict that the amount of delinquencies — people who can’t or don’t pay their debts on time each month — will increase by the end of 2018.

    Part of that prediction is based on a decline in the number of people who completely pay off their credit card bills each month. Even if you make the minimum payment every month, you will still be charged interest on the remaining balance.

    The September rate hold can give Canadians a chance to deal with outstanding debts — particularly credit card debt interest.

    Consider the following options for managing credit card debts, or other consumer loans, that you can’t pay off in full:

    • Seek a consolidation loan with a fixed-interest rate.
    • Don’t open up any more credit cards if you can’t pay the balances on existing ones.
    • If you have home equity available, consider using it to pay off outstanding debts.
    • Consider filing for a consumer proposal or filing for bankruptcy.

    At DebtCare, we can help you break free from your debt. We will assess your financial situation and make a plan to manage it before the next Bank of Canada prime interest rate increase.

    There is another BOC announcement scheduled for October 24, 2018. Many economists are predicting rates will increase again at that time.

    Don’t wait — get in touch with us before October 24.

    Call 1-888-890-0888 or visit www.debtcare.ca for a free consultation.

  • How is a Consumer Proposal Different from a Bankruptcy?

    Consumer proposal vs. bankruptcy — what’s the difference?

    At first glance, they can appear similar. Both clear your debt, stop collection action, and can harm your credit. But when we get into the nitty-gritty, there are several big things that set them apart.

    1. Assets

    Bankruptcy: When you file for personal bankruptcy, your assets are on the line. There may be allowable exceptions, like a car beneath a certain value, but anything over that can be taken. Each province in Canada has specific exceptions.

    Consumer Proposal: When you file for a consumer proposalyour assets aren’t touched. Instead, an agreement is made with your creditors to pay an amount of money in lieu of the full payment, and if they accept your debt is cleared, collection action stops, and your assets cannot be seized. But you have to prove that it is more lucrative for your creditors to accept your consumer proposal than it would be for them if you declared bankruptcy.

    1. Cost and Payment Schedule

    Consumer Proposal: A consumer proposal payment schedule is designed for you. You make a proposal to your creditors, usually a percentage of your total unsecured debt, and then you create a schedule to pay back that percentage. These are usually fixed, monthly payments that are made over a term of 48 to 60 months (four to five years). You also must pay the Licensed Insolvency Trustee (LIT) who files your consumer proposal a portion for his fee.

    Bankruptcy: Bankruptcy payments vary as they are based on your income. The more money you make, the more you’ll have to pay. A first-time bankruptcy can be completed in as little as nine months. If you have surplus income (if your household income is over the allowed amount) it may be extended up to 21 months. You are also required to pay the LIT a portion for his fee.

    1. Credit Rating Impact

    Bankruptcy: If you claim bankruptcy in Canada, you will receive an R9 credit rating. This is the worst rating you can have. It will stay on your credit report for six to seven years after you are discharged, depending on your province. If you are discharged after nine months, then the credit rating might stay on your record for seven to eight years total.

    Consumer Proposal: With a consumer proposal, you will receive an R7 credit rating. It will remain for three years after you complete your payments. So, if you complete your payments in five years, the R7 credit rating will remain for eight years total (five years, plus three years after it’s completed).

    1. Monthly Duties

    Consumer Proposal: There are no monthly requirements with a consumer proposal, besides making your payments on time. You do not need to report any changes in your income. You have to attend two credit counselling sessions.

    Bankruptcy: You are required to complete a monthly budget for income and expenses and supply copies of your pay stubs to your Licensed Insolvency Trustee (LIT). You also have to attend two credit counselling sessions.

    1. Tax Refund

    Bankruptcy: You will lose all tax refunds or tax credits you are owed.

    Consumer Proposal: You keep all tax refunds or credits you are owed.

    1. Eligibility

    Consumer Proposal: Your total debt cannot exceed $250,000 (excluding a mortgage) and you must be able to afford to repay a portion of your debts. You are not guaranteed to be granted a proposal just by filing one. It must be accepted by the majority of your creditors. You need to prove that they would be better off with this arrangement than if you filed for bankruptcy.

    Bankruptcy: Any Canadian resident who owes more than $1,000 in debt and is insolvent is eligible to file for personal bankruptcy.

    When you’re choosing between filing for a consumer proposal or filing for bankruptcy, there is no clear winner. They both have far reaching consequences and will take years to recover from.

    You also need to consider the bigger financial picture and all your forms of debt. Both a bankruptcy and a consumer proposal can cover unsecured credit and debt, such as credit cards, unsecured bank loans, lines of credit, payday loans, and unpaid bills.

    But they won’t deal with secured debt, like your mortgage, secured car loan, or lease. They also won’t include debts like spousal or child support, court-imposed fines, and student loans that are less than seven years old. You will still have to pay those debts.

    If you’re in a position where you’re considering filing for either one, make sure you have explored all of your other options. There could be another debt management solution that works better for you, without the same repercussions. And if you do decide to file, make sure that you seek independent representation besides your LIT.

    Remember, LITs make money off of your consumer proposal or bankruptcy. You need someone who represents you — and only you — when you’re going through the process.

    At DebtCare, we provide just that. We can represent you when filing for a consumer proposal or bankruptcy, and we can also make sure you have eliminated all other debt consolidation strategies.

    Contact us today for a free consultation. Call 1-888-890-0888.