Bankruptcy Alternatives in St. Albert
If your debts are weighing you down, and if you want to be free of them forever, you might consider bankruptcy.
But while this might be one debt relief solution that is available to you, it might not be the best answer.
When filing for bankruptcy, you will:
- Potentially lose some of your personal assets.
- Be responsible for the costs and fees of going bankrupt.
- Negatively affect your credit rating.
It might also be that the debts you owe can’t be covered by bankruptcy.
- Student loans that are less than 7 years old.
- Child support and alimony payments that are past due.
- Mortgage, car loans, and other secured debts.
For these reasons, it is important to consider some of the bankruptcy alternatives in St. Albert.
It is also important to seek budgeting help from a credit counsellor, as by managing your finances better, you might be able to budget for your debts, without incurring fees and higher interest rates through missed payments.
Bankruptcy Alternatives In St. Albert
There are a number of options open to you.
We will briefly discuss them below, but for more detailed information, get in touch with us to learn more about the bankruptcy alternatives in St. Albert.
Consider Debt Consolidation
There are a number of debt consolidation options open to you, and we go into greater detail on each of them here.
By far the most popular options are:
A Debt Consolidation Loan: This is simply a large loan you get from a bank, credit union, or another finance company to replace the other loans that you are tied down to.
You consolidate all of your loans into one easier-to-pay-and-manage loan and benefit from reduced interest, lower repayments, and a fixed end date for your debt.
You will also say goodbye to all of your other creditors, which is good news if you are tired of them harassing you for payments.
Not everybody is eligible for a debt consolidation loan, as those with a bad credit score may have their application turned down.
However, it is still an excellent bankruptcy alternative in St. Albert if you are eligible.
A Debt Management Plan: This can be organized with the assistance of a credit counselling organization.
Under the plan, you will make monthly payments to your credit counsellor and they will disperse the funds to your various creditors.
Of course, not every creditor will agree to a debt management plan, and you will need to keep up with your repayment schedule.
However, it is still worth considering if you are able to agree on a payment plan that suits the needs of both you and your creditors.
There are other debt consolidation options in the article we linked you to earlier so have a read, and learn more about the other ways in which you might consolidate your loans to pay off your existing debts.
File A Consumer Proposal
Depending on the type of debts you have, and your personal circumstances, a consumer proposal could be the right answer for you.
This is the number 1 alternative to bankruptcy in Canada, as you are able to clear your debts without having to lose any of your assets, and if your creditor agrees, you will have the opportunity to eliminate much of what you owe.
A Licensed Insolvency Trustee is needed to make a consumer proposal, as they are officially sanctioned to carry out the procedures involved.
They will work with you on a repayment plan that is affordable for you and will liaise with your creditors on your behalf.
While a consumer proposal will damage your credit report, it will, if accepted, allow you the opportunity to become debt-free within five years.
A consumer proposal is a legally binding agreement between you and your creditors, so you will need to stick to your repayment plan.
However, a Trustee will work with you to make sure you can keep to the payment schedule, so it is important that you listen to the advice given to you.
These are just some of the bankruptcy alternatives in St. Albert that are available to you, but to learn more, contact our team at Bankruptcy Canada.
Call us at (877) 879-4770 or use our form to arrange a free consultation with a Licensed Trustee.
The sooner you get in touch, the sooner you will start the journey towards a debt-free life, so don’t delay if your debts are causing you financial worry and stress.