This April Fool’s Day, Don’t Be Fooled By Quick Fixes To Debt Problems
(NEW WESTMINSTER, BC, – March 31, 2015) Earlier this month, Statistics Canada reported the household debt ratio had climbed to a new record high of $1.65 owed for every dollar earned, and with more Canadians owing record levels of debt, it’s important that consumers are aware of different debt repayment options so they aren’t fooled by quick fixes.
“There are many companies looking to take advantage of people who are in a vulnerable state with their finances,” says Scott Hannah, President of the non-profit Credit Counselling Society. “Some are more interested in selling you something instead of helping you get out of debt, and we want Canadians to be aware of what their options are so they aren’t fooled.”
Provinces such as Alberta and Saskatchewan have seen a sharp increase in the number of debt-stressed consumers, due to the rapid fall of oil prices and the accompanying loss of jobs. It is estimated that over 115,000 Canadians will file for insolvency in 2016, either through a consumer proposal or bankruptcy. Meanwhile, others will opt to settle their debts with the help of credit counselling.
There are many debt help options available out there, but to ensure you don’t fall for a trap that ends up costing you more, here are steps you can take:
· Don’t wait. As soon as you see trouble coming, call for help. Whether it’s a friend, a family member, or a non-profit credit counselling agency, reach out for help so you won’t have to go through it alone.
· Do your research. Make sure you are comfortable with the organization you want to contact. Reputable organizations are accredited, have no complaints with the Better Business Bureau and have had customers review them online.
· Don’t pay anything up front. If someone wants you to hand over money before helping you, exert caution. They probably care more about making money than getting you out of debt.
· Ask a lot of questions. If you are unclear about anything, don’t be scared to ask questions and make sure you are comfortable with answers you’ve been given. If something sounds confusing, you aren’t getting all the details, or you feel rushed or pressured into signing something is a signal that you should walk away.
· Quick credit fixes don’t work. There are no tricks or shortcuts to a good credit score. The best way to repair your credit is to pay off your debts over time.
· Know how getting help will affect your future. You will be debt-free at some point, but some programs leave a lasting record that could affect your reputation in the future, so choose carefully.
“Money and finances have become a bit of a taboo subject, and people don’t want anyone to know about their debts,” adds Hannah. “But, not talking about your financial problems and not getting the help you need can make these problems worse. Speaking with your creditors or a non-profit credit counselling agency is the best place to start.”
About the Credit Counselling Society (CCS)
The Credit Counselling Society is a non-profit organization dedicated to helping consumers manage their money and debt better. CCS provides free, confidential credit counselling, debt repayment options, budgeting assistance and financial education.