Are you worried that you are going bankrupt? Is bankruptcy the last option?

Don’t you worry, Canada, that’s not true? Before going for filing for bankruptcy, here are a few more alternatives you need to look into:

First of all, let’s understand Canada’s Consumer Debt Landscape

Consumer debt is at an all-time high among Canadians living in megacities; many households are managing many credit accounts, including credit cards, personal loans, auto payments, payday loans, and more. You feel powerless when your monthly payment becomes unmanageable.

Although filing for bankruptcy is a legal way to start over, there are long-term repercussions. Do you know that, for up to seven years, bankruptcy is shown on your credit report, which can harm your credit score and make it more difficult to get new credit. In the worst situation, you can lose your priceless non-exempt assets since the lengthy process drains you. To avoid such a situation, it is worthwhile to look into Canada consumer debt relief options.

Fast Fact: In 2024, total consumer insolvency hit 15 15-year high- about 137,295 filings.

Bank of Canada warns that several economic stresses, banks might reduce lending, potentially turning from “shock absorbers” into “shock amplifiers”

Top Bankruptcy Alternatives in Canada

Bankruptcy alternatives are entirely dependent on your situation and ability to repay your debt. These options include:

• Consumer Proposal

Ideal for Canadians with up to $250,000 in unsecured debt (not including mortgages)

• Debt Management Program(DMP)

It can be achieved with steady income and controllable unsecured debt.

• Debt Consolidation Loan

Canadians with sufficient earnings and good credit are likely to have little debt.

• Informal Debt Settlement

For those who possess the assurance and expertise to engage in negotiations with creditors.

• Budgeting and Financial Coaching

Ideal for Canadians who require assistance maintaining organization or who have lower debt levels.

How to choose the right Debt Relief Option

Choosing a suitable bankruptcy alternative depends on below factors:

• The type and amount of debt you owe.
• Your income and ability to make payments.
• Whether you have assets to protect.
• Your long-term financial goals.

A Licensed Insolvency Trustee or a reputable credit counseling agency can help you to understand your options. You can also go for trusted credit counselor; they will review your unique financial situation and recommend the most suitable solution.

Final Thoughts

Many Canadians have successfully handled their debts through bankruptcy alternatives. Consider your options before making a hasty decision that could permanently damage your credit.

Meet with our knowledgeable Credit720 team; they will help you navigate your situation and offer you the ideal solution that will benefit you going forward.