Dealing with debt is a struggle for many.
High levels of borrowing and high-interest rates can leave you dealing with unaffordable payments that can soon spiral out of control.
Seeking debt advice can lead you to all kinds of places, with many companies offering to help you out if you’re dealing with ‘bad credit’.
Knowing who to trust can be difficult, which is why it’s important to turn to licensed debt professionals to help provide you with the most positive outcome.
Debt consolidation can be an effective way of dealing with debt, but it’s important you choose the right path to help you manage it.
Find out more about debt consolidation and take positive steps towards becoming debt-free.
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What is debt consolidation?
Debt consolidation is the process of combining your debts into one.
That means instead of paying multiple payments to multiple creditors, you pay one single monthly payment.
This will make your repayments easier to manage, and means you have just one interest rate.
For many people, debt consolidation can help them get out of debt quicker and take control of their finances.
However, despite the benefits of debt consolidation, there are routes you could take that could cause your situation with debt to worsen.
Bad credit debt consolidation loans often lure people in with bold claims and promises, but these types of loans can incur significant interest rates, leaving you paying as much as 47% interest.
While you might think a bad credit debt consolidation loan is the only option for you, there are other ways you can take control of your debt and work on getting back in the black.
Making the right decision for you
If you’re thinking about taking out a debt consolidation loan, there are some questions you should ask yourself first:
- Is this the best solution for my situation?
- Are there alternatives?
- Can I manage the repayments responsibility and avoid taking on further credit?
- Is this just a short-term solution to a long-term problem?
It’s important to weigh up your options before deciding to take on any kind of loan.
Seeking professional advice can help you establish if a debt consolidation loan is the right move for you, and ensures you’re aware of all of the alternative options.
By speaking to a credit counsellor, you can get professional advice and information about all of your available options to help you move forward in a positive way.
Take the first step, speak to a credit counsellor
Speaking to a credit counsellor can be an important first step towards clearing your debt.
A licensed debt counsellor will help by talking through your personal circumstances and working out exactly what you’re dealing with.
Dealing with debt isn’t a one-size-fits-all solution, and your credit counsellor will be able to discuss the best way forward based on your unique circumstances.
Alternative solutions to debt consolidation
There are multiple ways you can handle your debts, and while debt consolidation can seem like an easy option, it could lead to further problems down the line.
Obtaining good interest rates is difficult when your credit rating is in a bad way, and turning to companies offering a quick and easy solution can seem too good to be true.
Talking to a credit counsellor will help you see all of the available options for dealing with debt.
Credit counsellors can help you with a debt management program that will contact your creditors to have your debts put onto a repayment plan – helping to reduce your interest rates so that you can afford the monthly repayments and pay off your debts quicker.
Lasting around two and a half years, on average, you could soon wave goodbye to your debts and learn a lot about budgeting and taking out credit in the future.
In addition to debt consolidation, a licensed insolvency trustee could also help you with a consumer proposal.
A consumer proposal could help you through making a settlement with your creditors so that you only pay back a percentage of your debts over a fixed-term period.
There are a number of duties you’ll need to fulfil after filing a consumer proposal, and once these are complete, you’ll be debt-free and able to move on.
To find out which solution is the most appropriate for you, consult a credit counsellor today.
Getting help to deal with debt
Dealing with debt can be a struggle, and if you don’t know much about money, then you could have a lot of misconceptions about credit and debt and how to handle it.
If things are getting too much for you and you’re struggling to meet all of your repayments, it’s important to speak to a professional to get you the help and advice you need.
Not only can a credit counsellor help you find a solution to your debt problems, but they can also help educate you about managing your money to avoid future debt.
From learning how to create a budget to how interest rates work, having some financial knowledge can help you make better decisions going forward.
Once you’ve settled your debts, you can then work on rebuilding your credit rating ready for your future.
If you need debt advice, or need to find a solution to your debts, then Bankruptcy Canada can help.
We can provide you with a licensed credit counsellor to talk through your personal circumstances and help you understand your available options.
Should you need to go down the route of a debt management plan or consumer proposal, we can set the wheels in motion on your behalf.
If you want to get out of debt, we can help.
Get in touch with our friendly team today on (877) 879-4770, and we’ll help you take the first steps towards a debt-free future.