The Orderly Payment of Debts In Nova Scotia

Navigating Debt Management: The Orderly Payment of Debts In Nova Scotia

The new year often ushers in fresh beginnings, but for some in Nova Scotia, it only serves as a stark reminder of mounting debts and financial challenges. The increasing number of bankruptcy filings paints a worrisome picture, but the province offers a lifeline for its financially beleaguered citizens: The Orderly Payment of Debts (OPD) program.

Understanding the Debt Crisis

According to a distressing trend, more than 2,000 residents of Nova Scotia filed for bankruptcy from January to September in one year. This marked a nearly two percent increase over the same period in the preceding year.


“I max one credit card just to make a payment on another” is a common sentiment.


“I don’t know where the money is going to come from” is another recurring concern.


However, there are solutions and assistance available for those struggling with such financial crises.

The Orderly Payment of Debts In Nova Scotia: A Lifeline

The Department of Business and Consumer Services in Nova Scotia extends help to those unable to align their debts with their income. The Debtor Assistance Program offers free counselling, with counsellors reviewing budgets and suggesting suitable debt management programs.

Two such programs are the Consumer Proposal Program and the Orderly Payment of Debts Program. In this article, we place our focus on the Orderly Payment of Debts Program.

A Closer Look at the Orderly Payment of Debts Program

Under the Orderly Payment of Debts Program, individuals are given the opportunity to repay their bills over a maximum of five years, at an interest rate of five percent per annum. This is done while ensuring an adequate standard of living is maintained.

If enrolled in the program, individuals make a single monthly payment to the Department of Business and Consumer Services. This money is held in trust and paid to the creditors on a quarterly basis.

The benefits extend beyond financial organization; creditors are no longer permitted to contact or take legal action against the debtor—they must liaise with the department. Furthermore, participants are not allowed to acquire any additional credit during the program’s duration.

Applying to the Orderly Payment of Debts Program

To use the services of a counsellor and apply for the program, you can call 902-424-5200 or toll-free at 1-800-670-4357. For more information, visit the department’s website.

The website also provides budget worksheets, which can be beneficial in evaluating your financial management skills. After all, wise money management is the best defense against financial problems.

The Orderly Payment of Debts Program Across Canada

While the focus of this article is on the Orderly Payment of Debts In Nova Scotia, it’s worth noting that this program is also available in Alberta, Saskatchewan, and Prince Edward Island. An OPD is a form of debt consolidation and an alternative to bankruptcy.

With an OPD, the provincial court consolidates all your debts into a single payment and ensures repayments to your creditors.

Consulting a Licensed Insolvency Trustee (LIT)

Before deciding whether an OPD is the right solution for you, it is advisable to consult a Licensed Insolvency Trustee (LIT). These professionals are licensed and regulated by the federal government to offer all types of debt solutions. With their guidance, you can make an informed decision on the most suitable form of debt relief for your situation.

Delving Deeper Into the Orderly Payment of Debts

An Orderly Payment of Debts (OPD), also known as a Consolidation Order, is a form of debt management legislated under the Bankruptcy & Insolvency Act. It is managed by credit counselling agencies and is only available to those living in Alberta, Saskatchewan, Prince Edward Island, and Nova Scotia.

An OPD involves a designated provincial body filing an application on your behalf to the court. This order consolidates your unsecured debts into one monthly payment with an interest rate of 5%. You’ll then pay off the amount over a period of up to three years.

How Does an Orderly Payment of Debts Work?

The process of an Orderly Payment of Debts is straightforward and involves the following steps:

1. Contact your local administrator

If you live in one of the applicable provinces, including Nova Scotia, you can get in touch with the local organization administering the OPD program.

2. File your application

The administrator will file your court application for an Orderly Payment of Debts or a Consolidation Order. This order consolidates your debts and fixes the interest rate at 5%. It also implements a stay of proceedings, halting debt collection efforts by your creditors.

3. Make your payments

The provincial court consolidates your debts into one and decides on the amount you must pay periodically. You then make regular monthly payments to clear your debt. The payment amount is based on your individual circumstances and is distributed among your creditors.

Orderly Payment of Debts vs. Consumer Proposal

When it comes to debt relief, an Orderly Payment of Debts and a Consumer Proposal both aim to consolidate your debt and make repayments more manageable. Here’s how they compare:


Cost: An OPD generally costs more than a Consumer Proposal because it requires full debt repayment with a fixed 5% interest rate. A Consumer Proposal usually involves repaying a portion of your outstanding debt, with the remaining amount forgiven. However, for individuals struggling with high interest rates on multiple debts, an OPD’s single fixed interest rate can make repaying the debt in full more feasible and affordable.

Credit rating: Both an OPD and a Consumer Proposal have similar impacts on your credit rating. Both reflect as R7 on your credit report, just two points lower than an R9 (bankruptcy). The R7 is typically removed after two years, as long as you complete the OPD program.

Creditor protection: Both an OPD and a Consumer Proposal offer the same creditor protection, known as a stay of proceedings. This means you are protected against wage garnishment, debt collection calls, and legal action related to debt.


Deciding If an Orderly Payment of Debts Program Is Right for You

Choosing the best form of debt relief depends on your personal circumstances. Here are some factors to consider when evaluating if an OPD is right for you:


  • You can afford to repay your debt in full but struggle with financial management due to high interest rates or other issues.
  • You are unable to qualify for a consolidation loan.
  • Your debt is small enough that a Consumer Proposal would cost you more money than necessary.
  • Consulting with an LIT can guide you on whether an OPD is the right choice for your financial situation. Receiving professional, unbiased advice is crucial when dealing with something as serious as debt.


Conclusion: Seeking the Best Path to Financial Wellbeing

If you’re unsure where to begin your journey out of debt, consulting an LIT can bring clarity to your situation.

Ready to say goodbye to your debt? Contact us today for a free consultation to discuss your debt relief options. We can help.

Find Your Personal Debt Relief Solution

Licensed Insolvency Trustees are here to help. Get a free assessment of your options.

Discuss options to get out of debt with a trained & licensed debt relief professional.