In Canada, there are solutions for people who find themselves in debt. If someone has over $10,000 of debts, they might be able to settle them for a figure of up to 70 percent of what they owe. This means they can write off over two-thirds of their debt balance legally.
When people are struggling to pay off debts and have to choose between feeding their children or paying bills, there are now solutions to help.
Solving debt problems
Companies like National Credit Help can help Canadians to reduce how much they owe in debt by between 40 and 75 percent. This allows ordinary Canadians to regain control over their finances again.
Benefits of getting bad debts written off
If you get your debt legally written off it will significantly reduce your bill payments each month. Writing off debts will also make any interest or late payment charges freeze, so this stops your debt problem from spiraling further. What’s more, with debt written off, the creditors will not be able to contact you or communicate with you so you will have much less stress. With just one monthly payment that covers all of the debts, you’ll feel much more in control of your finances and know exactly what is coming out each month and when. Finally, you can keep assets like your car and your home still.
Different options to legally write off debts
Depending on your individual circumstances, there are different ways you can write off bad debts legally.
- A consumer proposal. This is an arrangement between the creditor and you. It means you can repay a certain percentage of your debts, freeze interest amounts and stop wage garnishment and collection calls. A consumer proposal will stay on your credit file for three years.
- A debt consolidation loan. This is a loan that has a lower interest rate than what you’re currently paying for your debts. It covers all of your debts with one monthly payment. This won’t affect your credit rating but you will need a good credit rating to get it. Technically, this isn’t writing off debts but it does save you money and put you in more control.
- Debt settlement. Like a consumer proposal, a debt settlement can assist in reducing monthly payments and what you owe. This is not a legally binding agreement and creditors don’t have to accept it.
- Credit counseling. This is also an informal agreement but it allows for just one payment each month while reducing or eliminating interest. You can’t reduce the principle though.
- Bankruptcy. Filing for bankruptcy should always be a last resort for writing off bad debts. It will seriously affect your credit rating and will stay on your financial record for six years. During that time, you won’t be able to access credit again and it might even affect other areas of your life like your employment.
As bad debts are often complicated to resolve, you should always seek professional advice from a company like National Credit Help. Let bad debts be a thing of the past!