Credit Counselling Ontario

In this guide, we’ll explore cred counselling in detail, including what it is, how it can help you get back on top of your financial situation, and which organizations and resources are available to assist those in need of credit counselling services in Ontario.

If you owe money to creditors, it can be a stressful and overwhelming situation. Whether it’s credit card debt, consumer debt, or other unsecured lines of credit, finding a way to manage and pay off these debts can seem like an uphill battle. That’s where credit counselling comes in.

What is credit counselling?

Credit counselling involves working with credit counsellors who are knowledgeable and experienced in financial matters. These professionals offer guidance and support to individuals who are struggling with debt-related issues.

Credit counsellors help clients develop personalized plans to address their financial challenges and provide them with the tools and resources needed to make informed decisions about their money.

If, for example, you’re having trouble paying off your credit cards, a credit counsellor could negotiate with the credit card company on your behalf. With their help, the credit card might agree to lower the level of your minimum payments to help with affordability, or even agree to more favorable terms to make debt repayment more manageable.

How does credit counselling work?

Credit counselling typically follows a structured process to help individuals regain control of their finances. Here are the key steps involved:

Get a free financial health check from a credit counsellor

The first step in credit counselling is to schedule a consultation with a credit counsellor. During this session, the counsellor will assess your financial situation, including your income, expenses, and outstanding debts.

This financial health check provides a comprehensive overview of your financial standing and helps the credit counsellor understand your specific needs.

Consider a debt relief option to turn debts into an affordable monthly payment

Once the credit counsellor has a clear understanding of your financial situation, they can recommend appropriate debt relief options. These options may include debt consolidation, debt management plans, or consumer proposals.

The goal is to consolidate your debts into one affordable monthly payment that fits within your budget.

Get the financial education you need to keep debt problems at bay

Credit counsellors not only assist with debt management but also provide financial education to their clients. They offer guidance on budgeting, money management, and strategies to avoid falling back into debt.

By equipping individuals with the knowledge and skills to make sound financial decisions, credit counsellors empower them to achieve long-term financial stability.

What kinds of debts can credit counselling help me with?

Credit counselling can assist with unsecured debt. Unlike secured debts, unsecured debts are those that are not tied to any kind of collateral, like a house or a car.

Common examples of unsecured debts include:

• Credit card debt
• Consumer debt (e.g., personal loans, payday loans)
• Other unsecured lines of credit

How long does the credit counselling process last?

The duration of the credit counselling process varies depending on individual circumstances. It can range from a few months to a few years, depending on the amount of debt, income level, and commitment to the recommended debt repayment plan.

The credit counsellor will work closely with you to develop a realistic timeline for debt repayment and monitor your progress throughout the process.

Where can I find credit counselling services in Ontario?

There are several organizations in Ontario that offer credit counselling services. Here are a few reputable resources to consider:

Credit counselling society

The Credit Counselling Society is a non-profit organization that provides free credit counselling services to residents of Ontario.

They also offer debt management programs and educational resources to help individuals overcome their financial challenges. You can visit their website or contact them directly to schedule a consultation with a credit counsellor.

Canada Revenue Agency

The Canada Revenue Agency (CRA) offers various resources and programs to help individuals manage their debts and financial obligations.

They provide information on tax credits, deductions, and payment arrangements that can alleviate financial burdens.

Financial Consumer Agency of Canada

The Financial Consumer Agency of Canada (FCAC) is a government agency that provides resources and information on financial literacy and consumer rights.

They offer tools and calculators to help individuals better understand their financial situation and make informed decisions.

Alternatives to credit counselling (Ontario)

While credit counselling is an effective option for many individuals, it’s essential to explore other alternatives to find the best fit for your financial situation. Here are a few alternatives to consider:

Debt consolidation

Debt consolidation involves combining multiple debts into a single loan with a lower interest rate. This can make it easier to manage and pay off debts over time.

Many financial institutions offer debt consolidation services. It’s crucial to assess the terms and fees associated with consolidation loans before committing to this option.

Debt management plans

A debt management plan (DMP) is a structured program offered by credit counselling agencies. It involves negotiating with creditors to lower interest rates, waive fees, or create a more affordable repayment plan.

Through a DMP, you make a single monthly payment to the credit counselling agency, which distributes the funds to your creditors. This option can help simplify debt repayment and potentially reduce the total amount owed.

Consumer proposals

A consumer proposal is a legal process that allows individuals to make a formal offer to creditors to settle their debts.

With the help of a Licensed Insolvency Trustee, you can negotiate a reduced debt amount or an extended repayment period. If the majority of your creditors accept the proposal, you can make one affordable monthly payment to the trustee, who will distribute the funds to your creditors.

A key benefit of a consumer proposal is that it could help you write off up to 80% of your total unsecured debt.

Will using a certified credit counsellor be listed on my credit report?

Using a certified credit counsellor and participating in credit counselling services generally does not directly impact your credit report.

However, it’s important to note that if you’re enrolled in a debt management plan or choose debt settlement options like consumer proposals, these actions may be noted on your credit report and could have an impact on your credit score.

It’s always best to discuss the potential implications with a credit counsellor or Licensed Insolvency Trustee (LIT) before proceeding with any debt relief option.

Where can I get help to overcome financial challenges in Ontario?

If you’re struggling with your financial situation and feel like there’s nowhere to turn, Farber Debt Solutions is here for you. We offer assistance and advice to people struggling under the weight of debt, and provide practical debt relief solutions that tackle the issue at source.

We’re experts at easing the pressures of debt, with a track record of helping thousands of people regain control of their financial lives.

Our experienced advisors are ready to walk you through the options available to you and help you make the right decision for your future. Contact us today if you’re ready to put your financial problems behind you.