In Canada, there are several options available for credit counseling. They offer unique solutions that are not offered in other countries. They offer relief from credit problems and vary on the severity of the problem, and where you are located. Canadian credit counselors can analyze your debt situation and some sessions may be required as part of a bankruptcy filing. Canadian credit counselors will help the creditors get back as much as they can of what is owed to them as well. Often, they are the best option for dealing with financial problems that are overwhelming.
Canadian Debt Relief Options
There is the "orderly payment of debts" available in Alberta, Saskatchewan, PEI and Nova Scotia. With the help of Canadian credit counselors, you can file a Consolidation order. Consumer proposals are a step away from bankruptcy and offer some advantages over bankruptcy. Personal bankruptcy is another option available in severe cases.
Orderly Payment Of Debt Program
This program offers a way to pay your entire debt load back over a period of time. Interest rates may be dropped to 5 percent on all unsecured debt that is included in the OPD or orderly payment of debt program. This means that creditors will no longer contact you, but will contact your Canadian credit counselor instead. A legal stay of proceedings stops creditors from calling. You make one payment and the Canadian credit counselors divide it between your creditors.
Consumer Proposals
This is an option where you partially repay your debts. This is a step away from bankruptcy, but is helpful for creditors who will get back more than if bankruptcy were filed. It is also easier on your credit rating and interest rates might get dropped to 0 percent. You will have to file a statement regarding your financial situation and tell them what you can reasonably pay back. The creditors can then vote on it. A Canadian credit counselor can help you make it an attractive plan that will get accepted.
Personal Bankruptcy
While this is the most extreme way to get rid of debts, it is the only option that works for many people. If you owe more than $1,000 and are unable to pay your bills when they are due, you can start proceedings, which involves handing your assets over to a trustee. You are allowed exemptions for clothing and personal items, one vehicle and household furniture and appliances can be discussed. You will be required to go to 2 counseling sessions before the 9-month process is complete. Your Canadian credit counselors will help you to learn how to budget and file your monthly statement of income and expenses. Once you are discharged, your debts are legally forgiven and you can start to rebuild your credit.
Working It Out On Your Own
Your Canadian credit counselors can give you advice as to whether you are in the situation to work it out on your own by cutting back and paying down credit cards. Some people just need a little extra guidance when it comes to this and they are ready to help you figure out the best option for your situation.
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