Struggling to keep up with your bills can feel overwhelming, especially when debt keeps piling up faster than you can manage. Credit counselling is a debt solution that can help you take control of your finances, reduce your stress, and start working toward a debt-free future.
In this guide, you’ll learn what credit counselling is, how it works, and the alternative debt relief options available to Nova Scotia residents. With the right support and advice, you can find a path that’s in your best interests and puts you back on stable financial ground.
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What is credit counselling?
Credit counselling is a professional service designed to help individuals manage their money and address unsecured debts. Through expert advice, credit counsellors work with you to develop a plan that suits your best interests, making it easier to navigate financial challenges. This service is particularly beneficial for people struggling with mounting debt but wanting to avoid more drastic measures like bankruptcy.
Credit counsellors provide guidance on budgeting, help you understand your credit report, and may negotiate with creditors to reduce interest rates or set up manageable payment plans. The goal is to help you regain control over your financial situation without sacrificing your future well-being.
Reduce your debt by up to 80%
- Licensed Insolvency Trustees
- In-person, phone or video
- 75 offices across Canada
How does credit counselling work?
Credit counsellors offer personalized support to help you manage your debt and improve your financial situation. Here’s how it typically works.
Get an assessment from a credit counsellor
The first step in credit counselling is to schedule an assessment with a certified credit counsellor. During this session, the counsellor will review your income, debts, and overall financial situation.
They will take the time to understand your goals, whether it’s avoiding legal action or simply gaining better control over your finances and living at a level you can afford. The counsellor will help you identify the root causes of your debt issues, be it poor budgeting, high-interest credit cards, or an unforeseen financial emergency.
Explore your debt management options
Once your financial situation is reviewed, the credit counsellor will discuss different debt management options. These options might include negotiating lower interest rates, setting up manageable payment plans with creditors, or exploring debt consolidation programs.
Credit counselling services aim to reduce or eliminate fees and make repayment terms more affordable. If creditors are threatening legal action, the counsellor will discuss options like debt management plans or other solutions that can help you avoid such consequences.
Finding a reputable credit counselling agency
When looking for help with your debt, it’s crucial to choose a reputable credit counselling company. Not all companies are the same, and some may come at a high cost without offering much real assistance.
A good non-profit agency will work in your best interests to help you manage your debt affordably. Before signing anything, research the agency, check their credentials, explore their website, and read reviews.
Take the time to determine if they are certified and properly licensed to offer services in your province.
Debt Solution Finder
Nova Scotia credit counselling services
If you’re struggling with debt in Nova Scotia, finding the right support is important. Start by reaching out to organizations like the Credit Counselling Society, which provides free consultations and advice to help you better understand your options.
Make sure you work with a non-profit credit counsellor who is committed to your financial well-being rather than profit. Non-profit agencies offer lower fees, unbiased guidance, and a genuine focus on helping you regain control of your finances.
You can also look for referrals from trusted sources, check online reviews, and verify that the agency is licensed and accredited. Taking these steps ensures you’ll get reliable help when you need it most.
Will using a debt management program be listed on my credit report?
Yes, enrolling in a debt management program will typically be noted on your credit report. While it is not considered a loan or bankruptcy, any form of debt relief that involves modified payment terms can be recorded by creditors.
The impact of using an informal debt solution is generally less severe than filing for bankruptcy or a consumer proposal. Completing the program successfully and making consistent payments can help rebuild your credit over time.
It’s important to weigh the short-term impact on your credit report against the long-term benefits of becoming debt-free.
Alternative debt relief options
If credit counselling isn’t the right solution for your situation, there are several other ways to deal with your debt problems in Nova Scotia. Depending on how much you owe, your income, and your financial goals, another approach might be more effective for helping you achieve financial stability.
Below are some of the most common alternatives to credit counselling that could help you get back on track.
Consumer proposal
A consumer proposal allows you to combine your unsecured debts into one affordable monthly payment, often reducing the total amount you owe. Unlike credit counselling, it is a legally binding process administered by a Licensed Insolvency Trustee.
It’s important to note that secured debts like mortgages or car loans cannot be included in a consumer proposal — it only applies to unsecured debts such as credit cards, payday loans, and personal loans.
Debt management plan
A debt management plan is an informal repayment arrangement through a non-profit credit counselling agency. It focuses on helping you repay everything you owe without needing to file a formal legal proceeding.
While it may affect your ability to qualify for new credit temporarily, it can keep you in good standing with your creditors if you stick to the agreed payments.
Debt consolidation
Debt consolidation lets you consolidate several unsecured debts into a new single loan. Instead of juggling multiple payments and due dates, you make one payment at a (hopefully) lower interest rate.
This option works best if you can qualify for a loan with better terms than your existing debts, and if you’re confident you can pay it back without missing installments.
Bankruptcy
Bankruptcy is a legal process governed by the federal government, designed for people who have no other options available to them in order to manage overwhelming debt.
By filing for bankruptcy, you may eliminate most unsecured debts and protect some essential assets through exemptions. However, filing for bankruptcy should always be treated as a last resort because it will significantly impact your credit and your ability to obtain security or new loans for a period of time.
Get the advice you need to improve financial situation
For individuals or families struggling with debt or ongoing financial problems, getting expert help can make all the difference. At Farber, our Licensed Insolvency Trustees are here to guide you through every step of the debt advice process.
We have helped thousands of people across Canada take control of their finances, reduce stress, and start fresh. Whether you’re exploring credit counselling, consumer proposals, or other options, we’ll review your situation carefully and recommend the best course of action for your needs.
Contact us today by phone or online to schedule your free consultation. The sooner you take action, the sooner you can regain control over your finances and move toward a debt-free future.
