We likely all welcomed the lifting of pandemic restrictions and the return to in-person activities in 2022. Unfortunately, along with that return to “normalcy” came decreasing house values, increased interest rates and increased costs of living.  

Statistics Canada recently reported that Canadian households’ debt-to-income ratio rose by $1.83 in debt for every dollar of household disposable income. On top of the increasing debt level, multiple hikes to the rate of interest has caused significant increases in monthly payments for variable mortgages and lines of credit.    

If you are struggling with making your monthly debt payments or your payments are only being applied to interest and not reducing your debt, reach out to a Licensed Insolvency Trustee (“LIT”). A LIT will provide a detailed review of your financial situation and explore debt relief solutions. The most common debt relief solutions are:

  • Debt consolidation loan – consolidate all of your debt into one loan at a lower interest rate with one monthly payment
  • Debt management program – paying your creditors in full over 4 years with one payment through a non-profit credit counselling agency
  • Consumer proposal – offering a compromise to your creditors over a maximum of 5 years
  • Bankruptcy

This initial assessment is typically free of charge and will educate you on your options and explain the pros and cons of each solution. Start 2023 with a financial fresh start and reach out to us today.

Kathy portraitBy Kathy Lenart – Insolvency Partner, Licensed Insolvency Trustee
CPA, CA, CIRP
Member of the Ontario Association of Insolvency and Restructuring Professionals (OAIRP)
Canadian Association of Insolvency and Restructuring Professionals (CAIRP)