Bankruptcy Alternatives In Victoria

We know how worrying debt can be.

When you owe money to others, you will have fewer opportunities to save money for the future. You will have creditors writing to you with monetary demands. And you might struggle to pay your bills and your other household expenses, and so you will have further things to keep you awake at night.

Thankfully, you don’t have to let your debts overwhelm you. There are debt solutions available, one of which is bankruptcy. However, before taking this drastic step, there are bankruptcy alternatives in Victoria that are worth considering. We will take a brief look at some of them below, but if you would like to know about each in more detail, browse our website for further information and give us a call to arrange a free consultation with one of our licensed insolvency trustees. 

 

Bankruptcy Alternatives In Victoria

Bankruptcy is the right answer for some, but it’s not for everybody.

In some cases, you won’t be eligible for bankruptcy, as some loan types aren’t covered. These include mortgages and student loans that are less than 7 years old.

You might prefer to avoid bankruptcy too, as by doing so, you will avoid the fees attached, cause less damage to your credit score, and get to keep any assets that might otherwise have been used to offset some of what you owe.

For all kinds of reasons then, you might want to consider bankruptcy alternatives in Victoria. These include the following:

Debt Consolidation

There are all kinds of debt consolidation options open to you, and you can read about some of them here. By far the most popular types of debt consolidation are:

A Debt Consolidation Loan

 

This will give you the opportunity to reorganize your existing debts into one easier-to-pay loan. Banks, credit unions, and private finance companies can arrange this type of debt consolidation for you, but it’s worth shopping around, as you want to make sure you benefit from the lowest possible rate of interest on the loan. If you have a poor credit rating, your application might get turned down. Don’t despair though, as the next option could be open to you.

 

A Debt Management Plan

 

This might be your preferred choice anyway, as while a debt consolidation loan is useful, you will still be tied down to another loan. A debt management plan (DMP), on the other hand, is organized through a non-profit credit counselling organization. Through the programme offered, all of your debts will be consolidated into one monthly payment, and this will be dispersed to your creditors by your credit counsellor. To qualify for a DMP, your credit counsellor needs to show your creditors that such a plan is the right solution for you. If all goes well and it is agreed upon, you should become debt free within 5 years or less, depending on how much you are able to repay each month.

 

There are other kinds of debt consolidation options available, as can be seen in the previously linked article. Have a read, consider what might be right for you, and speak to us if you need further information.

 

A Consumer Proposal

Consumer proposals are the preferred debt relief solution for many, as they can bring about debt relief relatively quickly. By filing for a consumer proposal, you negotiate a debt settlement with your creditor. Interest is frozen while you file, an affordable repayment plan is put in place, and you are afforded protection from your creditors under the Bankruptcy & Insolvency Act.

 

With a consumer proposal, you need only repay a portion of your total debts. After 5 years, anything still owed will be written off and you will be able to enjoy a debt-free life. 

Be advised, however, that the consumer proposal will end if you fail to make your payments on time. By breaking the terms of your agreement with your creditor, you might be asked to return to the previous terms associated with your loan payments. 

 

To file for a consumer proposal, you need to meet with a Licensed Insolvency Trustee. You can arrange for this to happen through our services at Bankruptcy Canada. Your trustee will discuss your financial needs with you and will come up with a repayment figure that should benefit both you and your creditors. They will then liaise with your creditors on your behalf.
 

Get In Touch

To learn more about the bankruptcy alternatives in Victoria, give us a call today at (877) 879-4770 or complete this form to arrange for a free consolation with one of our trustees. The sooner you get in touch, the sooner your journey towards a life free of debt will begin.