02 Jan How to consolidate your debts in Ontario
When you have to manage multiple debts at once, you may want to explore merging them all into one loan, which is referred to as consolidating your debts. There is more than one way to consolidate your debt in Ontario; however, that doesn’t mean they’re all good because it depends on the specific facts in each case.
What is debt consolidation?
Debt consolidation refers to a process that may help you simplify your financial situation by giving you the ability to combine all your debts into one, so you only have to make one payment.
Below, we cover off a few of the money management options we’ve seen lead people into trouble when they tried to navigate the consolidation process themselves. Before deciding how best to approach seeking debt relief, consult a Licensed Insolvency Trustee to position yourself for long-term financial success.
Options for debt relief clients have tried before approaching McLennan & Company for help:
- Seeing if family will lend them money, so they’re responsible for repaying a relative – rather than an institution
- Going through their personal bank to get a consolidation loan
- Liquidating assets for a total value that allows you to pay off your debt
- Leveraging a pre-packaged debt management plan
Money can’t buy happiness, but not having the means to pay your debts can certainly put a damper on your personal and professional lives.
Before considering any of these options for debt consolidation, we highly recommend you speak to a debt insolvency specialist who can provide support that is specific to your situation.
The so-called debt solutions listed above can, at best, be complicated and, at worst, create significant barriers that prevent you from recovering your financial security. On the other hand, if you work with a Licensed Insolvency Trustee, you will have the power and expertise you need to create a customized Consumer Proposal.
A Consumer Proposal is a legally binding debt consolidation solution that can only be filed with a Licensed Insolvency Trustee in Ontario.
Here’s an example of how a Consumer Proposal can work for you:
You may have $40,000.00 in unsecured debt (credit cards, income tax debt, etc.) and the Consumer Proposal may offer $20,000.00 as a full settlement- without interest and including the Administrators fees (i.e. the Trustee), so long as 51% of creditors approve.*
The last thing you need when worrying about debt is further surprises, so protect yourself against the fine print of a consolidation loan by working with a Lisenced Insolvency Trustee you can trust. They will liaise between you and your creditors to get you the best possible consolidation loan.
If you’re struggling with debt in Southwestern Ontario, contact McLennan & Company to discuss your options for debt relief. We look forward to providing you with transparent, expert and non-judgmental advice, so you can feel confident reducing your debt – and keeping it gone.
* Other factors are relevant and should be discussed with us, in a confidential meeting at our office.