FILL OUT THE FORM BELOW AND RECEIVE A NO-OBLIGATION CONSULTATION

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*Unsecured debt includes credit cards, lines of credit, bank overdrafts, payday loans, and unsecured personal loans (excluding student loans). It does not include mortgages and car loans.

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How can we help you?

If you have unsecured debt of under $10,000 and live in the Province of Ontario filing bankruptcy may not be the best option for you. We suggest you contact the Office of the Superintendent of Bankruptcy at 416-973-6441 to discuss your options, or you can visit their website here.

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Do I have options?

Hello,

I earn over 30,000 dollars per year and have about 20,000 credit card debt. I don’t have any real assets to my name.

I feel that with the high interest rates I never seem to get ahead as I do try to pay off as much as I can every month.
I work very hard but it seems like I’m going in circles, with this debt hanging over my head.

Are there options for me? I feel rather stressed out.

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One Response to “Do I have options?”

Barton Goth, GCO Inc. Bankruptcy Trustees said...

The options that we suggest people consider when they are experiencing financial difficulty include:

1. Negotiate with your creditors. Explain why you have fallen behind in payments. Outline your financial situation and expectations for the future. Suggest a payment plan that is realistic and reasonable for both you and your creditors. As this is an informal process make sure that if you come to an agreement get written conformation. .
2. Apply for a consolidation loan. Take out a loan to pay off all of your debts. This can potentially lower your interest rate, total monthly and sometimes the total length of the contracts. With consolidation loans it is important that you examine your current spending habits and stop using your so you do not continue to fall further behind.
3. Make an application to Credit Counseling. This is a voluntary program where your debts are pooled together (they aren’t actually paid off) so that you are only required to make a single monthly payment to a non-profit counseling agency. As you make your payments the agency forwards funds to each of your creditors in proportion to your total debt. The advantage of this procedure is that usually the interest on your unsecured debts is reduced to prime or even eliminated. You are required to repay 100% of what you owe, but because of the reduced interest your monthly payment is much lower than all of your minimum payments would have been without the plan.
4. Make a proposal to your creditors under the Bankruptcy and Insolvency Act. This solution is used by people who cannot afford (or get approval for) a consolidation loan or a credit counseling plan, but don’t want to file bankruptcy. In a proposal you offer to repay a portion (perhaps 100%) of the debt that you owe. Proposals are an excellent alternative to bankruptcy, but they are not well known so I suggest you contact a local trustee and ask them about proposals if you are interested in this solution.
5. File for bankruptcy. If none of the other procedures listed is appropriate for you then bankruptcy may be correct solution. The concept behind bankruptcy is that you cannot afford to repay even a portion of your debts. To file bankruptcy you must meet with a trustee in bankruptcy, licensed by the federal government to handle this type of procedure. To find a trustee in your area use the links on the right hand side of the website.

Certain provinces have an additional option for their residents called an Orderly Payment of Debts. When you speak to a trustee they will advise you whether or not this solution is available where you live and makes sense for you.