Credit counselling
A credit counsellor can help explain a budget and informal repayment options. Understand the service, the costs and what creditor participation means.
Understand the option ↗Debt options in CanadaCompare debt options.
Compare debt options.
Understand the trade-offs.
Different routes change different things. Use this comparison to prepare questions, not to make an eligibility decision from a table.
Start with what needs to change
Are you trying to organize payments, reduce borrowing costs or deal with debt that cannot realistically be repaid? Those are different questions. A new loan, an informal arrangement and a formal insolvency process do not offer the same mechanics or protections.
No route is best for every person. Income, assets, debt types, creditor participation, fees and legal circumstances all matter. Credit consequences can differ under each approach.
| Compare the details | Repayment plan | Consolidation | Debt management plan | Consumer proposal | Bankruptcy |
|---|---|---|---|---|---|
| What changes | You direct payments using your available budget. | A new loan or credit product repays selected debts. | A counsellor coordinates an informal arrangement. | A trustee administers a formal offer to creditors. | A trustee administers a formal insolvency process. |
| Costs to examine | Interest, fees and the time needed to repay. | Rate, fees, term and any collateral or co-signer. | Programme fees, interest and participating debts. | Payments, administration costs and your obligations. | Payments, assets, duties and circumstances affecting cost. |
| Questions about creditors | Are accounts current? Can required payments be maintained? | Which creditors are paid out? Which debts remain? | Will each creditor participate, and on what terms? | Which debts are affected and what acceptance process applies? | Which debts may remain and how are secured creditors treated? |
| Legal effect | A payment method, not a formal insolvency process. | A new credit agreement, not insolvency protection. | Informal; different from statutory insolvency protection. | Subject to insolvency law and the accepted terms. | Subject to insolvency law, duties and discharge rules. |
| Who to speak with | A creditor or qualified counsellor where needed. | The lender; a counsellor for a broader comparison. | A reputable, qualified credit counselling agency. | A Licensed Insolvency Trustee. | A Licensed Insolvency Trustee. |
On a small screen, scroll the table horizontally. This overview omits individual eligibility and jurisdiction-specific details. A qualified professional should explain the implications for you.
Debt consolidation
Combining payments can simplify a budget. Compare the total borrowing cost, repayment term and security before replacing existing debts with a new credit product.
Understand the option ↗Consumer proposals
Understand the formal offer, the role of a Licensed Insolvency Trustee and the obligations involved before deciding whether to explore a consumer proposal.
Understand the option ↗Personal bankruptcy
Bankruptcy is a legal process with responsibilities and consequences. Learn the questions to discuss with a Licensed Insolvency Trustee before making a decision.
Understand the option ↗Ask about the plan when life changes
A quote should explain more than the first payment. Ask what happens if income drops, a creditor declines, a payment is missed or another debt comes to light. Read the total cost and any new risk to an asset or co-signer.
A self-managed repayment plan may also deserve consideration where required payments fit. Learn the snowball and avalanche methods, or use our fixed-payment calculator for a limited illustration.
You don’t have to arrive
with all the answers.
A useful conversation starts with the right questions. Learn who can help and how to check their credentials.
Find qualified help