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  • Summer Debt Relief: Tips to Reduce Your Debt

    Debt ReliefOver the summer many families find that debt rises with the temperatures; vacations, weekends away, daily outings, etc. can all leave the wallet feeling very light. If you entered the summer drowning in debt, the worst thing that you can do over the summer is add to that. Instead, use this time to make some financial changes and reduce you debt rather than continuing to build it up. Here are our summer debt relief tips to help you regain control of your finances.

    Debt relief tip #1: Go over your finances and set a budget. Look at how much you spend every month on bills and see where you can save. And be realistic. Don’t deny yourself every luxury – you won’t be able to stick to it. For example, if you eat out 5 nights a week, don’t cut this out altogether, you are bound to cave in at some point. Instead try and limit these treats to once a week, or even once every 2 weeks.

    Debt relief tip #2: Avoid making only minimum monthly payments. Most of your monthly payment is just interest, very little of the principle balance being paid off as a result. Check out your monthly statement – most will give you a timeline showing when your balance will be paid off if only monthly payments are made – this might shock you – and hopefully motivate you to reduce your debt!

    Debt relief tip #3: Contact your creditors and see if they can offer a lower interest rate, especially if you have received offers from other companies offering an interest free period and free transfer (just be sure that you can pay off the balance before the interest free period is up). This option though is often only good for those with good credit – if your credit is less than stellar or if you routinely miss payments, there isn’t much motivation for your creditors to reward you with a lower interest rate.

    Debt relief tip #4: Seek the help of a professional. Once you get deep into debt, it can seem impossible to climb back out. But it is possible. If you have tried to reduce your debt but just can’t seem to make any progress, it might be time to call in the professionals, ones with experience helping Canadians get debt relief. Debt consolidation, consumer proposals or bankruptcy are all viable options to reduce your debt, and can all end up significantly reducing the amount of debt you currently carry.

    Don’t let summer spending get away from you. Instead, try to reduce your debt instead of increasing it with these tips and others. For more tips about debt relief and how to reduce your debt over the summer, please contact DebtCare by calling 1-800-890-0888 or visiting www.debtcare.ca.

  • 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.

  • 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.

  • Canada Day: Are You Sticking to Your Debt Reduction Strategies?

    debt reductionHappy Canada Day everyone! July 1st marks the half-way point of the year, and it is time to look back at the last six months and see how well you have managed thus far to stick to your New Year’s resolution. If you, like so many other Canadians, made a resolution involving your personal debt reduction but seem to be falling behind, you may not actually like this glance back. But don’t worry, according to a recent survey done by PricewaterhouseCoopers, you are not alone.

    An article on this survey released by CBC News reports that 63% of survey respondents said that their financial goals for 2013 included significant debt reduction. However, less than 25% of those had actually managed to achieve this goal, while 26% said that they had been completely unsuccessful.  Economists continue to report on the status of Canadian debt levels, trying to hammer home the importance of personal debt reduction and adopting debt reduction strategies, but it seems as though Canadians across the nation are having a much harder time actually making these strategies work for them.

    If you are reading this and find yourself in the 26% range, having had no significant victory over your current debt load over the first half of 2013, it might be time to think about an alternative debt reduction plan that will actually work.

    A debt reduction company likely isn’t the answer. Debt reduction companies will often have you made a monthly payment to them over an extended period of time with a promise that when enough money is received they will settle your debts. One problem though – what happens if they go out of business? What security do you have that your money is secure? Also, a debt reduction company that offers a service will be motivated to push their product.

    A financial consulting company, hired by you to represent you, can present you with all of your financial options. This could include debt reduction through settlements or through a consumer proposal. It could also mean a debt consolidation – your debt reduction solution will largely depend on your personal circumstances. Pay attention to marketing by debt reduction companies. A debt reduction company that says they ‘will’ reduce your debt by 80% for example is different from a financial consulting company who says that they ‘may’ be able to reduce your debt. No company can make a guarantee without knowing your individual circumstances.

    What types of strategies exist? Well, as we mentioned, one is a consumer proposal. This is by no means the only approach. However, if you are drowning in debt and are only able to make your minimum monthly payments, or worse, not even these, this solution might be the best choice. Debt consolidation might be another solution to reduce your monthly payments by consolidating debt into a single monthly payment. Whatever your situation, exploring all of your options is the best way to reach a positive outcome.

    If you want to actually achieve your New Year’s resolution and take control of your debt, you don’t have to do it alone. A good financial consultant can provide you with the help you need to get control of your finances.

    For more information about debt reduction strategies that will actually help you reduce your debt, please contact DebtCare Canada by calling 1-800-890-0888 or visit www.debtcare.ca.

  • Canada Revenue Agency Got You Down? Here Are Some Tips for Dealing with the Tax Man

    Dealing With The Tax ManOwing money to the Canada Revenue Agency is by far one of the scariest financial challenges that many Canadian taxpayers face. The Canada Revenue Agency is not an average creditor because they are part of the federal government. They have significant authority with respect to enforcing tax compliance and collecting tax debts.

    This authority includes (without a court order or notice to you):

    1. Pursuing criminal charges under the Income Tax Act
    2. Imposing penalties
    3. Imposing interest
    4. Notionally assessing your income even when you don’t file a return
    5. Garnishing your wages
    6. Freezing your bank account
    7. Placing a lien on your home
    8. Placing a lien on other property
    9. Garnishing your company’s receivables, and more….

    The Canada Revenue Agency can be ruthless. If you have a tax debt that you can pay, you must be very careful. The Canada Revenue Agency may seem amiable and willing to make a payment plan with you. They will send you a request for financial disclosure. On the financial disclosure you will have to tell them where you live, where you work, provide all sources of income, provide all assets, banking information and more… You may complete this form being open and honest indicating all of your liabilities and payment and then based on what cash flow is left, promise a payment plan.

    Once the Canada Revenue Agency receives your financial disclosure they will know all of your assets, where you bank, where you work – you will be completely exposed. Also, when the CRA reviews your budget and sees payments to other creditors like loans and credit cards, they will exclude them from the budget and ask you for significantly more in terms of a monthly payment than you are comfortable with.

    This will leave you in the worst position – Who do you pay? What about your credit? What about your family? What about your job? This is how the human aspect of having a tax debt can be sometimes even more impactful than the financial consequences. Many taxpayers suffer with medical problems that stem from stress associated with an inability to pay a tax debt.

    Listen, you cannot draw blood from a stone and there are many reasons why Canadian taxpayers find themselves unintentionally in trouble with the Canada Revenue Agency. A good financial consultant can guide you through programs that are available that can stop CRA collections and help you deal with your tax debt. Attempting to negotiate directly with the CRA will often lead to increased exposure so the best thing you can do if you have a tax debt you can’t pay is seek professional help.

    If you need help with a Canada Revenue Agency tax debt contact DebtCare Canada online or call 888-890-0888.

  • What is R9 Credit and How Can I Get Rid of It?

    What is R9 CreditMany individuals who have an R9 on their credit report will often reference their credit as ‘R9 credit’, as though R9 is the credit rating.

    Credit reports have an over-all rating. This is a number between 300 and 900.

    This rating is calculated based on everything that is listed on your credit report. 300 represents a poor rating and 900 represents the best rating.

    When you request your credit report this “score” is called a FICO score. When a lender requests your credit report they see the same score – this is called the “Beacon score”. A Beacon score and a FICO score are the same thing. R9 credit is not your overall credit score, although it will reduce it.

    What is R9 credit?

    The letter R stands for revolving and the 9 represents a “bad debt write off” so it’s a credit card, line of credit, store card or some other form of revolving credit that has gone into default. If you do not make a payment on a revolving credit product for 6 months your individual rating for that credit product will become an R9.

    An R9 will remain on your credit report for 7 years from the date of last activity (this is the last date that you made a payment on the credit).

    Many people think that somehow the bad rating will magically disappears after 7 years but it is important to note that it is 7 years from the date of last activity and it won’t necessarily go away on its own. This is a very common credit report error that many people end up spending many months to resolve.

    R9 credit can be resolved in one of a few ways:

    1. You can pay the debt in full – it should be removed 7 years from the date the debt has been paid in full.

    2. You can make a settlement on the debt with your creditor(s) the R9 credit should be removed from your credit 7 years from the date it is reported as settled.

    a. Settlements must be documented, including proof of settlement being accepted by your creditor and proof of payment.
    b. Equifax must be independently notified of the settlement.
    c. You must follow up to ensure that the settlement has been reported to your credit report.

    3. If you go to credit counselling, the R9 credit will turn into an R7 credit and the R7 will be removed from your credit report 3 years from the date the credit counselling plan is paid in full.

    4. If you file a consumer proposal the R9 credit will be removed from your credit 6 years from the date it is paid in full make sure when you file a consumer proposal that you independently send proof of the consumer proposal to Equifax.

    5. A bankruptcy  the R9 credit will be removed from your credit 6 years from the date the bankruptcy is discharged make sure when you file a bankruptcy that you independently send proof of the bankruptcy to Equifax.

    6. R9 credit can also be removed 7 years from the date of last activity if that was the last time a payment was made on the credit product. This is in no way a slam dunk often creditors will continue to report activity to the credit report even after there hasn’t been any. Also, if the account is purchased by a collection agency, this can become extremely complex.

    Having this issue on your credit report is not great but it isn’t the end of the world either.

    There are ways to not only work to have the R9 removed but also to correct any other bad credit to help rebuild your credit score. Speaking with a financial consultant skilled in dealing with R9 credit is a smart practice.

    If you have R9 credit and need help please contact DebtCare by calling 1-888-890-0888 or visit www.debtcare.ca.

  • How to Deal with Credit Report Errors

    Thousands of Canadians have credit report errors on their credit reports – the scary part is many of them don’t even know it.Credit Report Errors

    Credit report errors most commonly occur when your creditors don’t accurately report information to your credit report. The reason credit report errors are so common is because the data is reported electronically by your creditor to your credit report.

    You may be getting declined for credit or quoted higher interest rates on credit because of credit report errors and new lenders you apply to for credit are not allowed to tell you what’s on your credit, so it won’t be pointed out to you.

    The most common types of credit report errors are payments and settlements that have not been reported. The only way to avoid credit report errors is to know what’s being reported to your credit report. The first step you have to take if you want to avoid credit report errors is to request your credit report from both Equifax and TransUnion.

    Credit report errors can be extremely difficult to get resolved because Equifax will require evidence from you to support that there is an error and if you don’t have it or they won’t accept what you provide you then have to rely on your creditor to report the correct information. Creditors can take months to do so, if they do so at all.

    The only way to get credit report errors corrected quickly is to know your rights and to dedicate the time needed to accomplish the task.

    1. The Ministry of Consumer Services is the ministry responsible for the Consumer Reporting Act which is the legislation that consumer reporting agencies like Equifax and TransUnion, as well as your creditors, must follow when reporting your personal information.

    2. Any communication concerning corrections that are needed should be sent in writing and should be sent by registered mail.

    3. You must know the timelines in which you should expect credit report errors to be updated, make sure that you request your credit report to ensure that they have been made and if they have not follow up again in writing.

    Failing to ensure that there are no errors reporting to your credit report can have serious consequences. Not just because you may not be able to obtain the credit you need but also because you will most certainly pay higher interest rates on credit products if lenders view the credit report errors as derogatory which could cost you thousands of dollars or more.

    If you are thinking right now that you don’t have the time, energy or know-how to take on your credit report errors on your own – you are not alone. Many who advertise ‘fix your credit’ programs are actually companies looking to see you deal with credit problems through a bankruptcy or credit counselling. We take the position that credit errors are credit errors – not bad credit – even bad credit can be addressed using various financial strategies that do not involve bankruptcy. Following the Consumer Reporting Act and leveraging our in-house legal counsel, we fight Equifax, fight your creditors and get your credit fixed.

    If you need to fix credit report errors on your credit report, contact DebtCare Canada today by calling 888-890-0888.

  • Can You Really Trust An Ontario Bankruptcy Trustee

    Ontario Bankruptcy TrusteeBefore you can determine if you can trust an Ontario bankruptcy trustee, you first have to understand what an Ontario bankruptcy trustee is and what his or her role in a bankruptcy or consumer proposal is.

    An Ontario bankruptcy trustee is an individual or a corporation that is licensed by the Superintendent of Bankruptcy. Bankruptcy trustees are regulated federally. The role of an Ontario bankruptcy trustee is to administer bankruptcies and proposals, administer the estates of the bankrupts, hold in trust and subsequently distribute the assets of the bankrupt. The bankruptcy trustee must follow the Bankruptcy and Insolvency Act (BIA).

    The bankruptcy trustee is to be impartial and act in the best interests of both the bankrupt and the creditors. The same is true whether you are filing a consumer proposal or a bankruptcy. In the case of a bankruptcy, the bankruptcy trustee can oppose your discharge if you have not fulfilled your obligations under the bankruptcy. These obligations can change over the course of your bankruptcy and/or as a result of undisclosed information at the time you filed for bankruptcy. In layman’s terms, if you incorrectly estimate the value of an asset, forget to tell the trustee that you have a particular asset or in the middle of your bankruptcy you get a better job, this may change your monthly payment in bankruptcy and the length of time you are bankrupt – the bankruptcy trustee will make this determination.

    In the case of a consumer proposal you don’t have an ongoing obligation to the bankruptcy trustee like you do in a bankruptcy. With that said, the bankruptcy trustee assesses the proposal they will offer your creditors based on extracting maximum value for your creditors.

    So the answer to the question “can you trust an Ontario bankruptcy trustee” is yes. They are a licensed, regulated officer of the court. However, now that you know the role a trustee plays in a bankruptcy or consumer proposal, it may not be wise to approach him or her directly, no matter how warm and fuzzy the advertising is.

    Consumer proposals and bankruptcies are good options for getting out of debt and starting off on a fresh footing, but before jumping to this conclusion it is important to consider all of your financial options. Working with a qualified financial consultant that is experienced working with debt consolidation, mortgages, debt settlements, consumer proposals and bankruptcies will make you aware of these options. A financial consultant who is hired by you to represent your financial interests will ensure that you can be open and honest about all of your finances, ask questions that won’t impact you and assess a host of different financial choices. He or she can also line you up with the appropriate professionals (this includes bankruptcy trustees if necessary) and represent you through the process. This takes the burden off of you and ensures that you walk away with the best possible deal. In the case of a consumer proposal you could save thousands of dollars.

    If you are struggling with a financial problem and would like to review your financial options contact DebtCare Canada at 888-890-0888 or visit www.debtcare.ca.

  • How to Check Your Credit Score?

    In Canada, a credit Check Your Credit Scorereport and credit score is used by many different institutions, including banks, credit agencies, and even employers. These documents contain important information about your borrowing and repayment habits, and provide a detailed account of your past financial history. Even though these reports are so important, many Canadians are not familiar with the process of requesting and understanding the credit score.

    Understanding your credit score is important for a number of reasons. One of the most important is because, whenever you apply for credit, be it a mortgage, automotive financing, or a credit card, your credit report is pulled by the lending institution and assessed. In order to qualify, you must meet certain qualifications with regard to the report, and so knowing where you stand is crucial.

    What if your credit score is less than stellar? Too much credit, being too close to your limits or too many late or missed payments can severely reduce your credit score.

    In order to bring the score up, it might be prudent to speak with a financial debt consultant to discuss some options to reduce your debt and regain those lost credit points. Debt consolidation or consumer proposals are great options to help you get rid of your debt.

    So, do you know how to check your credit score and credit report? Here is some important information that will help.

    Requesting your credit score is actually quite simple. There are a few different credit reporting agencies in Canada, but the most popular are TransUnion and Equifax. Both of these agencies provide online copies of your credit report and credit score for a fee – simply visit the website, enter in some identity confirming information, and you will be able to print your credit report and credit score.

    Another reason that it is important to understand how to check your credit score and credit report is to make sure that everything it contains is accurate. Credit reporting agencies can make mistakes when compiling the information, and if something is reported incorrectly this can harm your overall credit. It is important to check your report regularly in order to find any mistakes and remedy them. That being said, when a mistake is brought to the attention of a credit reporting agency you may find yourself frustrated by the amount of back and forth that takes place. If you find yourself having a hard time dealing with those credit reporting agencies and their unwillingness to accept responsibility or fix the incorrect data, contact a financial consultant who can help get the issue resolved.

    If you want more information about how to check your credit score and how to understand your credit report, please contact DebtCare Canada by calling 888-890-0888 or visit www.debtcare.ca.