Monday, 21 November 2011

Debt Consolidation Loan, is it a Good Idea before the Holiday Season? We Explore Canadian Debt Consolidation Options

As the holiday season approaches, you may be thinking that a debt consolidation loan is a good idea so that you don’t face the New Year with maxed out credit cards and a budget that is stretched to its limit. There are so many services out there that offer debt consolidation options, but what is most important is that you fully understand each option and what it means to your personal finances and your credit.

Understanding your options starts with understanding who is offering you the option, so this article will outline Canadian debt consolidation options and what they really mean to you.

Your first thought may be to approach your bank for a debt consolidation. If you qualify, banks will often recommend a personal line of credit or a large credit card to consolidate your debt. The interest could range anywhere from 7% to 25%. The problem with this type of debt consolidation loan is that your budget may only have room to manage the minimum payment. If you don’t have the income to make massive lump sum payments, this type of debt consolidation loan may prove to be very difficult to pay off. Banks will usually calculate your minimum payment based on 1% to 3% of your balance, which usually only covers interest. If you get into the habit of only making minimum monthly payments, you will see no end to your debt.

Bankruptcy trustees also offer Canadian debt consolidation options. The challenge is that trustees in bankruptcy represent your creditors. A debt consolidation option offered through a trustee in bankruptcy may offer you the debt relief you need. With that said, a consumer proposal or bankruptcy is not a debt consolidation loan. If you go directly to a trustee in bankruptcy, the consolidation that is arranged will often give preference to your creditor which ultimately means you pay more.

Credit counselling agencies that offer Canadian debt consolidation options may be not for profit, however, they obtain most of their financing from the banks. This is by far the least favourable debt consolidation option because it not only destroys your credit, but it also involves paying off your debt over a long period of time. Not for profit credit counselling is really the best option only for consumers who owe less than $6,000 in debt.

Mortgage Agents will often promote debt consolidation options that involve mortgage refinancing. After legal fees, appraisal fees, broker fees and administration fees, this can prove to be the most expensive type of debt consolidation loan.

At the end of the day, if you are drowning in debt, the only way out may be through a debt consolidation loan. The type of debt consolidation that is right for you will depend on your how much debt you are in, the type of debt, your income, income type and assets. You will secure the best deal that makes the most sense for you by working with a skilled
Financial Advisor, one who can help you determine the type of debt consolidation loan that best suits your personal financial situation. For more information about debt consolidation loans and Canadian debt consolidation options please visit or call 416 907- 2582.

Tuesday, 15 November 2011

Get Out of Debt and Get Debt Relief before the Holidays and Start the New Year on Fresh Footing

With the holiday season quickly approaching, it may seem that everywhere you look there is a holiday offer or enticing deal. Holiday shopping can be fun but also dangerous, especially when your plan is to finance it using your credit cards.

Every year consumers approach the holidays already in debt and dig themselves into a deeper hole during the holiday season thereby facing huge credit card bills in the New Year. Those who have already maxed out credit cards and are barely able to make minimum payments, may be wondering how they are going to finance this holiday season at all.

Believe it or not, while the holidays are a time to enjoy with family, it can also be the source of immense financial and emotional stress, especially as it relates to debt. Instead of adding to your personal debt this holiday season, why not go into this holiday season with a strong financial plan to get out of debt?

The primary reason that families go into debt over the holidays is because of a lack of cash flow. Let’s face it, the recession in 2008 has caused many families to rack up personal credit that they are still trying to pay for today. If you are approaching this holiday season with more than $10,000 in household debt, then finding a solution to get out of debt and get debt relief should be your first priority.

Dealing with your debt before the holidays will not only free up cash flow but will also enable you to go into the New Year on fresh footing. You may have already gone to your bank for a debt consolidation loan, only to be turned down. You may be thinking that there isn’t a way to get debt relief before the holidays.

Your bank is not the only option available to consolidate and eliminate your debt. There are many options available to achieve debt relief, however, the key is to choose an option that best considers your entire financial situation and results in the best deal for you. This can be tough when you are out there on your own struggling to find the answer to get out of debt.

It is easy to procrastinate, thinking that you can deal with your debt in the New Year, but can you imagine starting 2012 without a landslide of credit card bills to deal with? Strong financial planning, budgeting and access to resources that help you achieve your financial goals will enable you to start the New Year stress free and with more cash in your pocket.

Banks, trustees in bankruptcy, credit counsellors and finance companies will offer “free financial assessments or consultations” as a gimmick to bait you into their offices, at which point they will offer you their financial products and services. This will often result in more debt, a bankruptcy or a financial arrangement that favours your creditors. There is unbiased financial help available to help you get out of debt and get relief before the holidays. The kind of help that doesn’t involve more debt or bankruptcy. For more information about how you can get out of debt
and get debt relief before the holidays visit or call 416 907-2582. This holiday season get financial help from an organization who represents you, not your creditors!

Tuesday, 8 November 2011

Business Owners Use Personal Credit and Find Themselves in Financial Trouble

Personal household debt in Ontario has been steadily on the rise over the past 10 years. The 2008 recession proved to many individuals that the idea of dedicating your life to a company in an effort to work towards a good pension is no longer a safe option. Most companies offer little in the way of job stability; this has caused many people to go into business for themselves and has increased the number of small businesses.

The reason we started this article by talking about personal debt is due to the fact that in most cases small business owners find themselves financing their dream of a small business with their personal credit. In Ontario, most financial institutions will not loan money to a small business without the owner personally signing for the debt. Therefore, if the business runs into financial trouble, the business owner will bear personal liability for the debt.

There are three primary reasons that a business owner will go into debt as it relates to their business:

-        To finance business growth

-        To finance start up

-        To keep the business going during times that receivables are down

When business owners use personal credit where their business is concerned, they are taking a major gamble. This risk could have serious consequences not only to their personal finances, but also to their health and relationships. Financial trouble can be the source of incredible stress, the kind of stress that can tear families apart.

Outside of using personal credit or personally signing on business debt, some small business owners will also collect sales tax throughout the year. They use this sales tax to benefit the business and do not set it aside for their annual remittance. Therefore, if the financial situation has not improved by the time taxes are due, the debt increases and this is a debt that the Canada Revenue Agency will demand to have paid in full.

When small business and personal debt compounds, a strong financial plan is the first step to financial recovery. There is help for small business owners who find themselves in financial trouble. The Federal Government offers programs for individuals who are drowning in personal and business debt. Access to these programs and strong financial planning is available through some Financial Advisors.

You will not find this type of financial help through your bank, through a company that lends money or through a trustee in bankruptcy. A good rule of thumb to follow when pursuing a company to help you deal with your debt, is to deal with a company whose only service is to offer financial planning and guidance. If a company lends money then they have an incentive to see that you borrow more. Trustees in bankruptcy and credit counsellors represent your creditors; this means that you cannot count on them for financial advice that represents your best interests. The only way to receive the best advice for you is to work with a company that represents you, and has access to the resources you will need to get debt relief. This will enable you to regain your positive financial standing.

If you are a small business owner who has found yourself in financial trouble and need help contact Michael Goldenberg by calling (416) 907-2582 or by visiting and take a step towards a positive tomorrow.

Tuesday, 1 November 2011

Small Business Debt Help Options in Ontario – Where Are They?

The recession that hit Canada in 2008 forced many Canadian businesses to make some very difficult decisions. For many, the recession came out of nowhere. When consumers stop spending, a seemingly prosperous business can quickly fall flat.

To survive, some businesses were forced to cut back. Laying off staff, implementing a hiring freeze and reducing spending on business expenses are a few examples of ways that businesses tried to survive. Other small business owners relied on credit to make ends meet and they are still suffering the consequences today.

For most, starting a business is a dream. Many individuals who start their own businesses invest everything into this dream. When things are going well you may be on top of the world, but when things take a turn for the worse, your business can quickly become the source of incredible stress. At this point the stress will begin to consume all of your time, energy and credit.

So what options exist in Ontario for small business owners who find themselves in debt and in financial trouble?

If you are a small business owner who has found yourself in financial trouble, you may have already realized that debt-financing options are scarce. Many banks will not lend to those small businesses who:

1. Have been in business for less than 2 years.
2. Have issues with their receivables (invoices that come in more than 60 days from the date of issue).
3. Cannot show good net business income on at least 2 years on consecutive business income tax returns.
4. Are looking for financial help because the business is struggling.

That is why many small business owners who are seeking debt help options in Ontario find themselves putting their company’s debt on their personal credit. Some max out their personal credit cards, and others go as far as refinancing the equity out of their homes in an effort to see their small business (their dream) survive. This doesn’t often work and blurs the line between an individual’s business and family because suddenly everything is at stake.

There are debt help options in Ontario for small business owners and for individuals who are stretched to their limits. These options often do not involve filing for bankruptcy. You will not access these resources through your bank. If you have found yourself in this situation, the best thing that you can do is establish a relationship with a good Financial Advisor, one who has experience working with small business owners who have found themselves in debt.

Take a step back and you will realize that more credit may not be the answer. Tough times call for tough financial decisions and you do not have to make these decisions on your own. If you would like information on small business debt help options in Ontario please contact Michael Goldenberg by calling 416 907-2582 or by visiting