Helping Out – Finding the Right Debt Management Firm

No matter how you look at it, debt is never something that anyone wants to deal with – both having it and getting rid of it – but it is a reality for the majority of the population. That being said, some individuals are able to conquer their debt problems on their own, eliminating the stress that comes with it. However, for others, when debt becomes insurmountable, turning to a debt management firm is the smartest solution. But how do you know which firm you can trust?

We have all heard the ads on the radio and seen the commercials about companies offering various debt reduction or debt elimination strategies – but not all of these are of the same ilk. Here is a list of characteristics to look for when researching the right debt management firm.

Experience – When it comes to your money, it is never a good idea to just go with the first company you find. Make sure that the firm you choose to work with has the experience and reputation to back you up. Is it a new business, one taking advantage of higher than average Canadian consumer debt levels, or is it one that has years of professional experience under their belt? The choice should be obvious here.

Options – Make sure that the company you choose to go with can offer you a number of different options for debt relief. A company that deals solely in bankruptcy is never the right choice. Make sure that your options are explained to you in a way that you understand, and that in the end the choice is left up to you. Ask questions and get the pros and cons (there are always both).

Consultation – The right company should offer some form of consultation, and the best companies will offer this for free. If you call a company and a solution is set up for you without any consultation at all, chances are that company does not have your best interests at heart. Thoroughly working through your unique situation is the only way to reach a realistic and achievable solution, so make sure that this is offered.

Code of Ethics – If the company you choose doesn’t have a code of ethics, you may not be as protected as you should be. Having a set standard to follow means that your information is protected, that you are getting fair and unbiased treatment, and that you are being given the tools to create an enduring plan for financial stability no matter the route you choose to take.

Stop stressing about your debt and solve the problem. The right debt management firm can help you – just make sure that it is a reputable one with the experience to get the job done right!

To find out about the debt management solutions available to you, from a firm that you can trust, please contact DebtCare Canada today by calling 1 (888) 890-0888.

Personal Debt Management – How You Can Regain Control of Your Finances

Even as the Canadian economy stabilizes, many Canadians continue to find themselves dealing with the difficulties brought on over the past few years. Debt has become, or rather continues to be, a major stressor for countless individuals. Although some Canadians have been able, over the past year, to climb out of that financial black hole, others still struggle to find a foothold.

If you are in the latter category, does this mean that you are forced to continually struggle with debt? No. There are many personal debt management options that exist which can help you get out of debt. Here are the main ones – as well as a brief description of how they work.

Debt Consolidation: Consolidating your debt means just that – consolidating all debt totals into one. This is usually done through a loan. With a debt consolidation loan, all other debts are paid off, and you are required to make only one payment each month. There are a number of benefits to this type of debt solution, including the convenience of a single monthly payment and the amount of total interest saved through consolidation (the interest rate for consolidation loans are often far lower than other types of debt, ie. credit cards). 

Depending on your circumstances, that can be a few difficulties with a debt consolidation. Since you are essentially getting another credit product, your credit will likely need to be in pretty good shape – but if you are struggling with a mountain of debt or having a hard time making monthly payments, your credit may not be stellar. Also, if you do have a large amount of debt, securing funding to consolidate all of it may also prove quite difficult.

Consumer Proposal: A consumer proposal is essentially a proposal made to your creditors to reduce the amount of your debt – the total of which is determined based on your income and ability to make the monthly payments. It is conducted by a trustee in bankruptcy and is an official process (meaning you cannot do it on your own). Once accepted by the majority of your creditors, your debt will be reduced and you are required to make manageable monthly payments to pay off the debt in a much shorter period of time.

There are many positives to a consumer proposal. Firstly, it reduces the total amount that you owe. Secondly, it consolidates all of your monthly payments into one, single monthly payment. It will also stop any collection enforcement action against you and can be paid in full at any time. That being said, it will impact your credit rating, but if you are considering a consumer proposal this has likely already taken place.

Bankruptcy: Although often considered the least popular, for many individuals bankruptcy is the only realistic option. In a bankruptcy, your creditors receive notice that you have declared and your debts are cleared. Bankruptcy involves a court determination that your assets are to be taken over by a trustee for the benefit of your creditors. During your bankruptcy you do have some responsibilities, including proving income monthly, attending credit counselling sessions, and making minimum monthly payments, but collection enforcement actions are halted against you.

Depending on your own unique situation, one of these may be a very attractive debt solution. Our best advice? Seek out some professional debt management guidance in order to choose the option that best suits your needs and circumstances.

For more on these and other debt management options, please contact DebtCare Canada today by calling 1 (888) 890-0888.

New Year, New Plan – Start by Getting Out of Debt!

Happy New Year Everyone! Time to get those resolutions started – and for many of us this means getting out of debt! With holiday shopping out of the way (and the subsequent credit card bills screaming at us from the mailbox), you can actually get down to business and rein in that spending. This year, start with a plan that you will actually be able to stick to, rather than just casting it aside a few weeks in. The only way to get your debt under control is to tackle it head-on.

Tip #1: Examine. Start by looking over all of your finances – usually not a fun experience – but something that cannot be avoided. In order to start fixing the problem, you have to know what the problem is. Go over all of your bills and make a list of totals owed for each, as well as a grand total (ouch!). This will also help you keep track of monthly bills and can be a great motivator when those totals start to decrease!

Tip#2: Assess and set priorities. Now that you know how much you owe, and to whom, step 2 is to figure out which items are the most important. We are not saying here that you should pick and choose which bills to pay – far from it – but rather which can receive a larger chunk of your monthly income. For example, if you choose to tackle the highest debt first, this may mean making only the minimum monthly payments on smaller cards but a much larger payment on the one with the highest amount owing. Or perhaps interest is the biggest factor, so make that card the priority.

Tip #3: Set a budget. Now that you’ve got the worst part (for most of us) out of the way, it is time to establish a realistic budget. This means taking into account all of your monthly spending and income. Doing this should help you eliminate some of those things that are a tad frivolous, or to limit yourself in those areas that see a lot of unnecessary or out-of-your-budget spending.

Tip #4: Stick to it. Perhaps this may sound easier said than done, but you have to be diligent. Debt isn’t going to go away on its own (chances are pretty high that, if left alone, it will only have the opposite effect). Try to think about ways to keep track every day, and make sure that you are tracking your spending and taking note of decreasing totals.

Tip #5: Can’t see a light at the end of the tunnel – get some help! If you have done these things but still can’t see a way to continually meet minimum payment requirements, stop stressing and get some help. A debt management firm can offer a number of different options to help you get out of debt, including debt consolidation, consumer proposal, or bankruptcy. These opportunities can often mean significant savings as far as interest, and can help you get the debt relief you need to keep your finances afloat.

Getting out of debt can be difficult, but it doesn’t need to be a nightmare. This year, try to stay strong and keep to that resolution. DebtCare can help – call us today at 1 (888) 890-0888.

Investment Advisors: Keep Clients’ Investments Protected with a Debt Management Company

As a financial or investment advisor your clients look to you for protection: to protect their family in the event of a death, to protect their wealth, to protect themselves when the time comes to retire and more…  You are often the first person that a client will turn to in good times and bad. Sometimes people fall on hard financial times. A divorce, a job loss or even taking a tumble in the stock market can see someone who was otherwise on solid financial footing finding it difficult to make ends meet. 

Most people want to do the right thing! They want to pay their bills, provide for their families and no one wants to make tough financial choices when they fall on hard times.

Unfortunately, sometimes difficult financial times lead people to make the wrong financial choices. All too often we see people who have a tax problem or excessive debts owed to creditors coming to us after they have liquidated their investments, giving all their money to their creditors in an effort to pay their obligations – yet they still find themselves owing more than they can pay, leading them to file a consumer proposal.

The challenge with this is that most people don’t know that even in a consumer proposal many of their assets like their home, vehicle and yes some investments like RRSPs can be legally protected.

Oftentimes people see a consumer proposal as a last resort – when really it is a viable option for getting out of debt that leads to quick recovery times where credit is concerned. If you have a client with financial problems the best thing to do is get them an unbiased financial evaluation from a financial consultant that specializes in consumer proposals. This way all options can be presented and strong contingency plans can be put in place which will better protect your client in the long run.

Another common occurrence is financial and investment advisors who don’t understand insolvency and submit their clients right into the clutches of a trustee in bankruptcy. This could be a big mistake. When you send your client directly to a trustee, your client is not the trustee’s client – they actually represent the interests of your client’s creditors. With that said, without your client they would not be in business so there is a high motivation to make your client feel secure and sell their services. While they may make your client feel secure at the time that they sign on the dotted line it doesn’t mean your client is safe, and the story at the time of signing can change later.

Financial consultants offer a wide range of financial services so they can present all options. Forging a strong relationship with a good financial consultant who specializes in consumer proposals will provide you and your clients with huge value in the long run.

 
For more information about how financial consultants can help you to protect your clients please call Michael Goldenberg at DebtCare at 416-907-2582 or visit www.debtcare.ca.

Debt Management – You Don’t Have to Do it Alone

When you are in debt, the personal issues that all too often accompany it can be overwhelming, and sometimes the task of ridding yourself of this financial burden can feel insurmountable. Knowing where to turn for advice or assistance can be tough, and so many people instead try to do it on their own. Debt can be crippling, but getting out of debt doesn’t have to be hard when you have the right people behind you, those that can offer debt management plans that can relieve your financial stress.  

There are several different types of debt management solutions available, and choosing the one that best suits your financial situation takes knowledge and a careful consideration of the options which exist. The most effective way to set in motion the best debt management program is to speak with a professional debt consultant.

What types of debt management programs can a professional organization offer?

Debt consolidation: Often debt becomes so problematic because monthly payments can take up the majority of your disposable income. This becomes even more challenging when those monthly payments are mostly interest, meaning that you are making very little principle payments overall. With a debt consolidation these payments are all combined into one manageable monthly payment, often with far lower interest. That being said, debt consolidations are often options only for those with credit in somewhat good standing.

Consumer proposal: Once your monthly payments become so large that you are often unable to meet them all, collection agencies may begin calling. A consumer proposal is a smart debt management program that allows you some relief from your debt obligations by lowering the amount you are required to pay back. Done in negotiation with a bankruptcy trustee, a consumer proposal leaves you with one monthly payment, freezes interest accumulating on debt and also stops collection action being taken against you. Consumer proposals are administered by bankruptcy trustees. It is important to note that trustees do not represent the bankrupt; they act to make a fair financial arrangement between you and your creditors. Never visit a trustee without your own representation. You want to work with someone with expertise in consumer proposals and bankruptcies to get a plan together and you should be able to count on your representative to negotiate with the trustee on your behalf.

Bankruptcy: If you have found that your monthly debt repayments far surpass your monthly income, and that you can’t keep up, bankruptcy might be the best option for you. Like a consumer proposal a bankruptcy must be conducted with a bankruptcy trustee, but it can leave you with relief from collection calls or wage garnishments. A bankruptcy can decrease your credit score, but if you are considering this option you have likely already damaged it.

Credit counselling: Credit counselling organizations are not-for-profit organizations where you make a single monthly payment to them which they distribute to your creditors. Credit counselling repayment terms can be long and grueling and credit counselling programs can result in significant damage to your credit.

Getting out of debt can be tricky, but you don’t have to do it alone. Ease the stress by choosing a debt management program in consultation with a professional debt consultant.

For more information about how a debt management program might be the solution to your financial problems, please contact DebtCare Canada today by calling 1-800-890-0888.

Avoid Bankruptcy through Personal Debt Management

Personal debt management is easier said than done. No person chooses not to pay his or her bills. If you don’t have the money, you don’t have the money. Debt can become unmanageable for so many reasons.

Regardless of the reason, whether you have lost income or you have simply become over extended, all reports indicate that the economy is improving. Canadians are looking for options to deal with debt without sacrificing their dignity and without filing for bankruptcy.

There are pro’s and con’s to bankruptcy. If you have no means whatsoever to pay your bills, are being garnished or have collection agencies after you, bankruptcy may be the best choice. Bankruptcy immediately protects you from your unsecured creditors and stops most collection action. The drawback to bankruptcy is, it is a long process, is often expensive and has a negative impact upon your credit. The choice to file for personal bankruptcy is one that should be considered carefully.

Statistics show that Canadians are looking for other financial choices to pay off debt. The challenge is simple, it seems that no matter where you turn someone has an agenda.

The banks often pay mortgage brokers. The banks promote their products to brokers and different products carry different incentives. The larger the mortgage and the longer the mortgage term, the more the mortgage broker earns from the bank. On that basis, if a small short-term second mortgage is the best solution, a mortgage broker may propose that you refinance your entire first mortgage. Sometimes it is better to pay the mortgage broker fee yourself and negotiate a shorter term more flexible mortgage product.

Many debt companies that promote “debt consolidation” only offer two choices, consumer proposal or bankruptcy. The best way to know if you are dealing with one of these companies is to ask them what options they offer other than bankruptcy and consumer proposals.

Of course, if you turn to your bank and they offer you help at all, it will come in the form of a credit product that yields them the most benefit. Most financial services representatives in banks are paid different incentives based on the products and services that they sell to you.

So what can you do when you need help with personal debt management and at the same time want to avoid bankruptcy altogether? Hire a company that offers a wide range of financial counselling services to help you find a solution to your money problems.

Here are a few good rules of thumb when looking for a good financial advisor:

You get what you pay for! It is better to pay for a service that is impartial and can help you make responsible financial choices vs. trying to sell you products and services.

Do lots of research. If you find a company, read through their website. See how diverse their ranges of services are. For example, debt counselling services that only offer federal government programs as the solution indicate that there is no incentive to encourage you not to participate if there is another option available that they don’t offer. Google the companies’ name to see if they have lots of credible published literature online or search for positive client reviews. Ask lots of questions to ensure that whatever personal debt management program you chose, you have chosen one that gives the most consideration to your credit and future financial goals.

For more information about how to avoid bankruptcy through personal debt management please visit http://www.debtcare.ca/