Read on to learn more about who we are, what makes Sands & Associates different from other debt help professionals, and some of our proudest achievements over the past 35 years.

Sands & Associates – Founded in 1990

Sands & Associates was founded in BC’s lower mainland in 1990 by Bankruptcy Trustee Earl Sands and later expanded to include six offices throughout the greater Vancouver area. In the coming years Sands & Associates would grow to an extensive network of local offices across the province, recognized as BC’s best, award-winning Licensed Insolvency Trustees.

BC-Wide Debt Help Services

Unlike many large national debt relief organizations, Sands & Associates focuses solely on debt help services for consumers and small business owners. We are the largest firm in BC to take this specialized approach, offering our services and advice with respect and understanding – we know that debt-stress can deeply impact people, and a debt problem can happen to anyone at any time.

• Sands & Associates is proud to be able to help people complete their debt-free journey, from consultation to debt-free, whether from the comfort of their own home, or in-person at a local Sands & Associates office near them.
• By embracing the connection technologies available we are helping to ensure that debt relief services are accessible to everyone, removing in-office service barriers and constraints.

What to Expect

Sands & Associates Clients

Our team values the trust people place in us when they look to our professionals for support and solutions to take control of their finances and move towards brighter, debt-free days.

Many people worry there are no solutions to their debt problem, and we are exceptionally grateful for our clients who have chosen to come forward over the years and share their words of reassurance and encouragement to others who may be facing a similar situation, and those who share their deeply personal stories about how they found a financial fresh start.

Read Client Reviews

Whether you are seeking information about a debt resource, or exploring specific debt solutions, we aim to provide a “five star” experience from start to finish, treating everyone with dignity and respect.

The post We Help with Debt – 35 Years and Counting appeared first on Sands & Associates.

Having polled over 1,700 participants who recently restructured their debts using a legal debt solution, the 2023 BC Consumer Debt Study offers a unique view into consumer debt issues in the province. Blair Mantin, President of Sands & Associates, the firm of Licensed Insolvency Trustees who undertook the study, joined CTV News to discuss the study’s findings.

Watch the clips here and learn more below:

Recent BC Consumer Debt Problems – by the Numbers

• The 2023 BC Consumer Debt Study’s largest proportion of participants (36%) said they had $25,000-$49,999 of debt (excluding vehicle loans/mortgages) when they started a formal debt relief process.
• Almost 3 in 5 people (58%) said credit card debt was the main type of debt they had, nearly five times higher than the next debt type.
• Close to 1 in 8 individuals (12%) claimed payday or instalment loans was their main type of debt, and tax debt (personal income tax, GST, etc.) took the third spot at 11%.

Credit cards and payday loans can be considered interest-heavy credit, and consumers can easily develop a borrow-repay-borrow cycle that is often impossible to break with interest rapidly accumulating. 

Dos and Don’ts for Credit Cards and Managing Your Credit Card Debt – Read More

What Are Some Common Causes of Personal Debt Problems?

The common causes of debt revealed in the 2023 BC Consumer Debt Study expose the vulnerability of many consumers when it comes to their ability to financially weather personal and economic challenges. Five of the top six common causes of debt as reported by insolvent consumers relate to triggering events or circumstances that are likely beyond an individual’s clear control:

• Just over a quarter of BC consumers polled (27%) said their debt was caused by overextended credit due to general financial mismanagement.
• Closely following, the second-most reported cause of debt for 1 in 4 consumers (25%) was using credit for essential costs of living income could not cover.
• Following these, the remaining top six causes of individuals’ debt were attributed to: Illness, injury, or health-related problems (11%); Marital or relationship breakdown (7%); Job related issue (5%) and Pandemic-related job loss or reduction in work hours (5%).

95% of individuals participating in the 2023 BC Consumer Debt Study said their household has been impacted by recent inflation increases, with the largest proportion (88%) noting inflation has their household now spending more on necessities such as food and gas.

• Half (50%) also say their household is no longer able to accumulate as much savings, leaving consumers further exposed to difficulties in meeting unanticipated financial needs.

There was a bright spot in the findings; however, with over 4 in 5 people (87%) saying their insolvency filing (making a Consumer Proposal or declaring Personal Bankruptcy) has helped them manage day-to-day finances despite noticeable rising costs.

What Happens When You Can’t Pay Your Debt? Learn More

Steep Costs of Unmanageable Debt – Coping with a Debt Problem

Individuals participating in the 2023 BC Consumer Debt Study reported a range of ‘symptoms’ brought on by their unmanageable debt, including:

• 4 in 5 people (83%) said they had a constant worry about debt.
• Nearly 4 in 5 people (79%) said their mental health suffered by being in debt, and 3 in 5 (61%) said their self-esteem suffered because of being in debt. Almost half of respondents (49%) said debt caused their physical health to suffer.
• Over three-quarters of individuals surveyed (77%) said they experienced anxiety from the stress of debt; also 66% feelings of helplessness or hopelessness, and 61% depression.
• Almost 1 in 6 people (16%) said they experienced suicidal ideation because of their debt-stress.

Debt Warning Signs and Delays Seeking Debt Help

Over 7 in 10 people polled (71%) said overwhelming stress was how they knew their debts were becoming a problem – and despite this, more than 96% of survey respondents did not seek professional help right away. 

• Most respondents (64%) said they waited to seek professional debt help because I wanted to manage my debt on my own.
• Further top reasons individuals said they waited to seek professional support were: I felt ashamed I couldn’t handle the debts I had incurred (56%) and I was embarrassed to ask for help (51%).

Other top-identified signs of a debt problem reported by consumers were more transactional:

• Only making minimum payments (60%).
• Seeing debt balances remain almost the same every month, despite making payments (55%).

A lack of visibility around legal debt help resources was also a significant barrier that contributed to individuals postponing seeking professional support, with a third of survey respondents (34%) saying I thought there was no solution to my situation; more than 1 in 4 (27%) I didn’t know where to seek help and 17% I had misinformation about how the Consumer Proposal and/or Bankruptcy process worked.

Debt Forgiveness with Personal Bankruptcy: Step-by-Step

How Did People Attempt to Solve Their Debt Problems?

Despite the significant personal impacts of their debt issues, fewer than 4% of people polled said they sought help right away from a debt help professional, and, in this time, individuals attempted a variety of different tactics to solve their debt problems.

• Many people turned to more borrowing to try to manage their debt, with over a third of survey participants (36%) saying they applied to extend credit limits on existing debts and 34% who borrowed from family or friends to make debt payments.
• More than 1 in 4 individuals (26%) applied for consolidation financing; 25% used payday or instalment loans, and 4% asked family or friends to co-sign a consolidation loan.

Participants in the 2023 BC Consumer Debt Study overwhelmingly used a Consumer Proposal to legally consolidate and cut their debt (81% of study respondents), and over 90% of all individuals surveyed said they were satisfied with their decision to eliminate their debts with an insolvency process.

More people than ever before are choosing to use a Consumer Proposal to consolidate and cut their debt, rather than file for bankruptcy. 

Learn More About Consumer Proposals

Getting Debt Help – Where Consumers Can Get Qualified Support

Blair Mantin, President of Sands & Associates, says that, unfortunately, it can be frustrating and discouraging for consumers who attempt to self-manage their debt for too long, and that overwhelmed consumers are highly vulnerable to inferior, unregulated, and even illegal services sold by debt settlement agents or debt advisors.

• Consumers are encouraged to get impartial and accurate advice from a Licensed Insolvency Trustee at the onset of a debt problem.
  • Licensed Insolvency Trustees are Canada’s only established debt help professionals and are fully regulated, qualified, and endorsed to serve Canadians with a range of debt management services and advice.
  • You do not need to be dealing with an extreme situation to seek support from a Licensed Insolvency Trustee, and consumers can get free, confidential advice at any point.
• Connect directly with a local Licensed Insolvency Trustee to better understand your situation, get accurate information, and explore all possible options in a free, confidential debt consultation.
  • No referral, payments, or third-party agents are necessary. 

Non-judgmental debt support for individuals and a full suite of debt help services is available to you. Connect with a caring local debt expert by phone, video, or in-person – book your free, confidential consultation today.

The post New BC Study Explores Personal Debt Problems in the Province appeared first on Sands & Associates.

Findings from the 2023 BC Consumer Debt Study were released today, presenting a unique exploration of consumer debt issues in the province. The eleventh annual study surveyed over 1,700 people from around the province who recently restructured their debts using a Consumer Proposal, or filed for Bankruptcy, inviting these individuals to share honest personal insights into their experiences dealing with debt, and finding solutions to these difficulties.

Conducted by Sands & Associates, the BC Consumer Debt Study series is the only study of its kind focused on BC and, according to Sands & Associates President and Licensed Insolvency Trustee Blair Mantin, the annual studies offer an opportunity to understand the realities of the financial challenges people across the province face, and the many facets of a debt problem. As Blair explains:

“As Canada’s debt help professionals, we know that when debt is unmanageable it carries impacts to a person that are far beyond account balances or credit scores. People’s mental health, relationships, physical health and more suffer seriously under this burden, and the emotional beating they take often causes them to struggle alone for months and even years.

In our current post-COVID, high inflation environment consumers are constantly facing a barrage of financial challenges and if uncontrollable debt is one of them, we know that things can deteriorate quickly. It is critical for people to have support, know where and how to access it, and have confidence in the resources available to help them resolve a debt problem and move forward with life.”

Click here to read the full 2023 BC Consumer Debt Study report

Click here to view and download the 2023 BC Consumer Debt Study infographic

Consumer Debt Issues in BC – Highlights from the 2023 BC Consumer Debt Study 

The largest proportion of participants in the 2023 BC Consumer Debt Study (36%) said they had $25,000-$49,999 of debt (excluding vehicle loans/mortgages) when they started a formal debt relief process.

• 30% of all study participants described their credit rating as ranging from ‘good’ to ‘excellent’ at the time of making a Consumer Proposal or filing Bankruptcy.
• Close to 3 in 5 people (58%) said credit card debt was the main type of debt they had, almost five times higher than the next debt type.
• Roughly 1 in 8 individuals (12%) claimed payday or instalment loans was their main type of debt, the highest proportion of this type of debt in the BC Consumer Debt Study series history.

Other trends may indicate consumers have become less able to accumulate and maintain a large debt-load, and that the access to Consumer Proposals as a debt management alternative to Bankruptcy has increased substantially:

• 2023’s study had the highest number of participants ever indicating their debt levels were below $25,000 when they started a Consumer Proposal or Bankruptcy, while the number of people who indicated having debt levels of $100,000 or more was the lowest ever.
• The proportion of Consumer Proposal filings (over Bankruptcy) in BC has increased significantly over time. As illustrated by respondents in the BC Consumer Debt Study series, Consumer Proposals as the solution of choice rose from 20% of respondents in 2012’s study, to a whopping 81% of respondents in 2023. 

Behind the Debt: Economic Issues and More

Consumers appear vulnerable to a range of personal and economic issues outside their immediate control that may create financial strain that ultimately develops into a debt problem:

• Just over a quarter of BC consumers polled (27%) said their debt was caused by overextended credit due to general financial mismanagement.
• Closely following, the second-most reported cause of debt from 25% of consumers was using credit for essential costs of living income could not cover.
  • The proportion of individuals attributing their debt to a reliance on credit for living expenses increased from 20% in 2022’s study.
• The remaining top six causes of debt identified by consumers were: Illness, injury or health-related problems (11%); Marital or relationship breakdown (7%); Job related issue (5%) and Pandemic-related job loss or reduction in work hours (5%).

95% of the 2023 BC Consumer Debt Study respondents indicate their household has been impacted by recent inflation increases, with the largest proportion (88%) saying inflation has their household now spending more on necessities such as food and gas. Half (50%) also say their household is no longer able to accumulate as much savings, leaving consumers exposed to future challenges in meeting unexpected financial needs.

Signs and Symptoms of a Debt Problem 

More than 7 in 10 people polled (71%) said overwhelming stress was how they knew their debts were becoming a problem. 

• Other top-identified signs of a debt problem as reported by consumers were: Only making minimum payments (60%); Seeing debt balances remain almost the same every month, despite making payments (55%) and Accumulating more debt on credit accounts (37%). 

Study participants disclosed a range of personal impacts to coping with unmanageable debt, including:

• A constant worry about debt was present for over 4 in 5 people (83%).
• Almost 4 in 5 people (79%) said their mental health suffered by being in debt, and 3 in 5 (61%) said their self-esteem suffered because of being in debt. Nearly half of respondents (49%) said debt caused their physical health to suffer.
• 29% of people polled said the stress of debt caused them to alienate themselves from family or friends, and 30% said their relationships suffered due to debt-stress.
• Over three-quarters of those surveyed (77%) said they experienced anxiety from the stress of debt; also 66% feelings of helplessness or hopelessness, and 61% depression.
• Almost 1 in 6 people (16%) said they experienced suicidal ideation because of their debt-stress. 

Managing a Personal Debt Problem 

Although over 90% of people polled in the 2023 BC Consumer Debt Study said they were ultimately satisfied with their decision to eliminate their debts with an insolvency process, arriving at this positive solution unfortunately often takes an extended time – over 96% of survey respondents did not seek professional help right away. 

• Most respondents (64%) said they waited to seek professional debt help because I wanted to manage my debt on my own.
• Other top reasons individuals waited to seek professional support were: I felt ashamed I couldn’t handle the debts I had incurred (56%) and I was embarrassed to ask for help (51%).
• A lack of public awareness of debt management resources also remains a significant issue, with a third of survey respondents (34%) saying I thought there was no solution to my situation; over 1 in 4 (27%) I didn’t know where to seek help and 17% I had misinformation about how the Consumer Proposal and/or Bankruptcy process worked.

A variety of different tactics were used by BC consumers polled, as individuals attempted to solve their debt problems on their own, often turning to more borrowing as a solution:

• Over a third of survey participants (36% and 34% respectively) said they applied to extend credit limits on existing debts and/or borrowed from family or friends to make debt payments.
• A quarter of individuals (26%) applied for consolidation financing; 25% used payday or instalment loans, and 4% asked family or friends to co-sign a consolidation loan.

Outlooks and Attitudes Improved After Solving Debt Problems

In addition to positive sentiments around their choice of a Consumer Proposal or Bankruptcy to manage their debt, more than 4 in 5 participants (87%) said that filing a Consumer Proposal or declaring Personal Bankruptcy has helped them manage day-to-day finances despite noticeable rising costs.

Individuals polled additionally said their experience receiving professional debt help:

• Improved their budgeting and/or savings skills (69%).
• Has made them more confident in day-to-day financial management (59%).
• Gave them a better understanding about credit and borrowing (54%).

Debt study participants were also invited to share their retrospective advice to others, and to provide words of encouragement to others who may be facing similar struggles. We highly encourage readers to browse these personal insights shared, as highlighted within the 2023 BC Consumer Debt Study report. 

Click here to read the full 2023 BC Consumer Debt Study report

Click here to view and download the 2023 BC Consumer Debt Study infographic

2023 BC Consumer Debt Study infographic

View the BC Consumer Debt Study series here

For further details about BC Consumer Debt Studies or media inquiries contact Sands & Associates President Blair Mantin.

About Sands & Associates and the BC Consumer Debt Study Series

Sands & Associates was founded in 1990 and has grown to become an award-winning leader in the debt help industry, now BC’s largest firm of Licensed Insolvency Trustees focused exclusively on debt services for consumers and small businesses.

Taking a non-judgmental “debt smart with heart” approach to helping individuals deal with a debt problem is the foundation of Sands & Associates’ beliefs, and we feel that understanding the extent of a financial crisis is a crucial step in providing the right solutions and support to people in need.

It is our goal that the BC Consumer Debt Study series will continue to highlight challenges faced by individuals across the province and encourage members of professional and government organizations to take active steps to reach consumers in need early, and with the right support to achieve better outcomes.

Supportive debt relief services and debt restructuring solutions are available for BC residents via telephone, video, and in person at local offices throughout the province. Connect with a qualified local Sands & Associates debt expert today – book your free, non-judgmental debt consultation here.

The post Increasing Number of Consumers Turning to Credit for Costs of Living, with Impacts to Mental Health and More – Latest BC Consumer Debt Study appeared first on Sands & Associates.

Read on to learn some of the ways being debt-free can change your life, and hear some expert tips to help you get there faster. As Canada’s only licensed debt experts, Licensed Insolvency Trustees help people every day who are looking for debt solutions, and we see many positive changes in our clients once they make the decision to take back control of their debt.

How Is Life Different, Debt-Free?

People often say that knowing what they do now, they wish they hadn’t waited so long to take charge and get help with their debt. Money isn’t the only thing that improves when you’re debt-free – your overall wellbeing can benefit too, including:

• The weight of debt-stress and worries or anxieties about your debt is lifted.
• You can stop feeling as though you are being controlled by your debt payments or creditors.
• Having dealt with your debt for good allows you to stop holding space for the debt and instead have space for your future, in your thoughts, plans and finances.
  • It’s almost impossible to think about your future goals when you’re juggling the financial pressures of daily life plus trying to manage high debt payments.
  • Taking debt out of the equation when you’re budgeting can hugely improve your cash-flow and make goals feel a lot more attainable.
  • Picture what even an extra few (if not several!) hundred dollars could do for you a month.
    • 30% of clients previously polled said being debt had previously caused them to put life events on hold.

Facing overwhelming debt can impact people in many negative ways, affecting our physical, emotional, and mental health, and even our relationships with other – and it can be very difficult to see there is light at the end of the tunnel when you’re weighed down by present challenges, or past misconceptions or self-blame.

Dealing With Debt

Your debt and the situations that may have caused it do not define you and are often due to circumstances or events outside your personal control. Money problems can happen to anyone at any time, regardless of your personal finances or financial literacy and money skills.

Many people “do all the right things” and still end up struggling financially, needing help to get out of debt – there is no shame in asking for help, you owe it to yourself.

You do have a future, and you are deserving of a fresh start, with life free from debt and its overwhelming stress. Please know that you are not alone – there are many other people facing similar challenges, and better still, there are solutions and professionals here to help you.

Debt Help Services for BC Consumers

Licensed Insolvency Trustees are Canada’s only debt help practitioners who are regulated and endorsed by the federal government to provide debt help. Sands & Associates is BC’s largest firm of Licensed Insolvency Trustees focused exclusively on debt management services and support for consumers and we offer our full suite of services in-person and online for residents across BC.

• At Sands & Associates it’s important to provide our expertise and advice in a way that’s clear and actionable, and to treat people with kindness, respect, and empathy always. We appreciate that it can feel overwhelming or intimidating asking for help, especially with such a personal issue.

8 Things Canadians Should Know About Debt Relief Services

Whether you know you have a debt problem or you’re hoping to find more effective ways of paying off debt, the best place to turn for debt advice is a Licensed Insolvency Trustee. Working with a Licensed Insolvency Trustee you can count on having a free, confidential consultation where you can get accurate professional advice, and an impartial representative that will help you weigh your full range of options. No referral or special qualifiers are needed – you can simply call or connect directly.

Consumer Proposals are Canada’s number one alternative to bankruptcy and can have many advantages over other solutions like consolidation loans and credit counselling programs. For example:

• The dual advantage of cutting debt and stopping interest makes the monthly payments in a Consumer Proposal often the lowest among debt management options.
• You’ll gain breathing room and legal protection from your creditors.
• With personal one-on-one financial counselling included in the process, you’ll have the opportunity to gain more confidence in financial literacy skills, improving your ability to control and manage your daily financial affairs, as well as gaining a better understanding credit and borrowing.
  • Many people also say they are more open in discussing money matters and even sharing their financial skills and knowledge with others after their experience working with a Licensed Insolvency Trustee.

We help with debt so you can move forward with your life; whether you need a total financial fresh start, debt forgiveness and creditor protection, or reorganization and structure to pay off your debt – we’re here for you.

Ready to get working on your debt-free future? Connect with a caring local Sands & Associates debt expert.

The post The Debt-Free Difference appeared first on Sands & Associates.

Watch the clip here, and read more below:

What is a Reasonable Amount of Personal Debt?

There’s no ‘magic number’ when it comes to understanding how much debt is too much; for some people their debt problem shows up as $20,000, for another $5,000 – or even $100,000 for someone else – and much depends on each person’s unique situation.

Rather than relying on a specific number, consider not just your ‘on paper’ finances, but also how well you are coping with managing your debt and whether you are making clear progress towards paying your debts off.

If you are experiencing any of the following, consider this a sign your debt may be reaching a problem stage, or is potentially on its way to an urgent crisis:

• Often feeling stressed or worried about your debt.
• Making only (or slightly more than) minimum monthly payments on your credit card debt.
• Carrying debts with payments that use up a large portion of your regular income or that would take more than five years to pay off (non-mortgage debt).
• Regularly relying on credit cards (or using payday loans) to meet costs of living, or taking on more debt. (This could be increasing credit limits or considering a consolidation loan to manage debt.)
• Owing a government creditor such as Canada Revenue Agency a balance you can’t afford to pay off.
• Having multiple years of unfiled tax returns, especially if you are self-employed.
• Uncertainty as to who you owe debt to and how much is owed or just avoiding account balances altogether.
• Having borrowed against most of your home equity to consolidate or manage debts.
• Receiving collection action, including calls, wage garnishments or pending court dates.

Debt can snowball over time and because people get used to adapting to cope and manage the situation, dealing with a debt problem daily can all too easily start to feel ‘normal’. It’s important for each of us to do a financial check-in periodically and be honest in how we’re doing.

Identifying and cutting off a debt problem before it’s severe can save you untold amounts of time, stress – and of course money! Take an hour to connect with a Licensed Insolvency Trustee and get some qualified advice about managing your debt, and a personalized debt-free plan.

Debt Options Calculator – Compare Four Ways to Pay Off Your Debt

I Think I Have a Debt Problem – What Should I Do?

The first thing to understand is that if you think you have a debt problem – you’re almost always right. And if this is the case, the second thing to know is that the problem is almost always going to get worse if you don’t take some action.

Talking with a local Licensed Insolvency Trustee in your province is the first and best thing to do.

• Avoid trying to ignore the problem, or assuming you don’t qualify for help.
  • Consumers can access a Licensed Insolvency Trustee directly for support any time at no cost, there are no eligibility requirements to seek advice.
• Be cautious about where else you seek debt advice. Licensed Insolvency Trustees are the only government-qualified debt help professionals.
  • Advertisements from debt consultants and credit counsellors can be misleading and may imply a company is part of a ‘government program’, which is not the case. The only ‘government programs’ to deal with debt are those accessible by working with a Licensed Insolvency Trustee.
  • Be on guard for high-pressure sales tactics, up-front fees, high-interest loans, and unrealistic promises.

Talking with a Licensed Insolvency Trustee

Every day Licensed Insolvency Trustees provide advice to people who are dealing with problem debt or looking to pay off their debt with less interest and/or in less time.

• There is no cost to talk confidentially with a Licensed Insolvency Trustee and get guidance on the options available to you.

When you connect with a Licensed Insolvency Trustee it is our responsibility to ensure you are aware of and understand all your options. We help people make informed decisions on how to address their financial difficulties and move forward. We’ll review potential solutions such as:

• Credit counselling programs, and negotiating directly with your creditors.
• Consolidation loans, and consolidation without borrowing using a Consumer Proposal.
• Bankruptcy, and other laws or resources that may help you resolve your situation.

Many people have a difficult time asking for help or feel embarrassed or ashamed to be struggling with their finances. Please know, you owe it to yourself to get debt help and you are not alone. Licensed Insolvency Trustees are your best allies – here for you with solutions and support, not judgment.

What would your life look like, without debt? Take an hour to learn about your options and get a debt-free plan that’s right for you. Book your free, confidential consultation with a non-judgmental expert at Sands & Associates.

The post How Much Debt is Too Much? appeared first on Sands & Associates.

What is the Bank of Canada, and What Do They Do?

The Bank of Canada is the country’s central bank; it is a special type of Crown corporation belonging to the federal government that exists “to regulate credit and currency in the best interest of the economic life of the nation” with their primary role being “to promote the economic and financial welfare of Canada”.

Monetary policy is a core Bank of Canada function, and two main instruments used in this are its inflation-control target and the key policy rate:

• Inflation is the persistent rise in average price levels over time, and the Bank of Canada aims to maintain a stable price environment – a low, stable, predictable inflation is their goal. With price stability and low inflation, prices change so slowly there’s no major effect to how people spend, save, or invest.
• The Bank of Canada adjusts its key policy interest rate up or down as needed to achieve its inflation target. Doing so influences financial institutions’ interest rates, borrowing and spending, and pressure on prices.

What Does the Bank of Canada’s Interest Rate Mean for Other Banks?

Financial institutions borrow from each other and can also use the Bank of Canada, and by setting their policy rate the Bank of Canada encourages financial institutions to borrow and lend amongst themselves near the policy interest rate too. What this means is that although the public doesn’t borrow with the Bank of Canada, their policy rate affects interest rates on products such as:

• The prime rate for loans and lines of credit
• Mortgage rates
• Interest on savings and deposits

When the Bank of Canada changes their rate, lenders will generally adjust their prime rates shortly after.

• Prime rate is the annual interest rate our major banks and financial institutions use to set their interest rates for variable credit products, including loans, lines of credit and mortgages with a variable rate.

How Interest Rate Increases Impact Common Consumer Credit Products

Depending on which products (types of debts) you have, and whether your debts have fixed or variable interest rates, the impact of an interest rate increase can vary widely, from very significant to having no impact at all.

• When you have a fixed-rate debt you agree to pay the same interest rate over the course of your repayment term, regardless of shifts in the economic market.
  • One benefit with this type of borrowing is that you’ve got stability in paying the same interest rate (until you need to renew, such as with a mortgage at the end of a set term).
• With variable interest rates, as the prime rate goes up or down, so does the interest you’re being charged on your debt. When you apply for credit with a variable interest rate the lender will offer you an annual interest rate tied to the bank’s prime rate.

Below is a breakdown of different types of common consumer debts, and how they may be impacted (or not) by interest rate changes:

Mortgages

The biggest impact of interest rate increases is likely to be felt by homeowners who are carrying variable interest rate mortgages.

• On a variable rate mortgage, quite simply, most payments will see an increase because of rate hikes. Most banks adjust quite quickly – people might see the impact even by the next month.
• Just a small interest rate hike can be very impactful. For someone with a variable mortgage of 2-3%, even a 1% increase in interest rates can translate up to a 50% increase in the interest being charged on the mortgage.

Conversely, on a fixed rate mortgage, your payments will not increase as you have ‘locked in’ the rate you will be charged over the term of the mortgage. At renewal time however, you can expect that the rates you locked in at previously may no longer be available and your new interest rate upon renewal could be significantly higher.

Can I Get a Mortgage After a Bankruptcy or Consumer Proposal?

Lines of Credit and Home Equity Loans

Most lines of credit (whether secured against your home or not) are offered with a variable rate, which means there is a direct impact of an interest rate increase.

• Higher payments will be required immediately, and this can be very significant – especially if you are financially stretched and are capable of paying just interest only on your line of credit.

Vehicle Financing

Most vehicle loans are structured with a fixed interest rate, meaning that payments wouldn’t change at all.

Although an interest rate hike won’t cause a direct increase on your monthly vehicle financing payment with a fixed interest rate, individuals with vehicle financing should be aware that:

• If you decide to trade-in your vehicle before the end of your financing contract, you may absorb the ‘negative equity’ (i.e., the value of your vehicle, less the amount you still have to pay on the original loan contract).
• New loans applied for following an interest rate hike will most likely have higher interest rates, and as a result will come with an increased cost to borrow.

If you do have a vehicle financing contract with a variable interest rate component, normally a rate-hike will mean extending the time you’ll make payments so that the additional interest rate costs are paid. 

An Overview of ‘Seize or Sue’ and Vehicle Loans in BC – Learn More

Student Loans

If you have a fixed-rate student loan you won’t be impacted with increases in your interest rate or monthly payments, but following increases in prime rates, future student loans can become more expensive.

However, if your student financing is using variable rates, both your interest rate and minimum payments will increase with interest rate hikes.

Are Credit Cards Impacted by Interest Rate Changes?

Most credit card terms are set without regard for prime interest rates and if your only debt is on credit cards then your monthly payment requirements are unlikely to be impacted by an interest rate increase.

With standard credit card interest rates hovering near 20%, the very real danger of interest when it comes to credit card debt is that the interest charged is always expensive, regardless of fluctuations in the Bank of Canada rate.

• If you’re not paying off your credit card in full each month you accrue interest charges – a cost of borrowing – and then only a portion of your payment goes towards paying down the amount you actually charged on the card.
  • In some cases, just $10 of what you pay each month goes to reduce the balance; the remainder covers interest and finance charges that reoccur each month.
  • Check your monthly credit card statement to see a breakdown of how long it will take you to pay off your credit card balance if you only pay the minimum payments each month. The number might surprise you!
• If you miss a payment, you could find your bank raises your credit card interest rate because of the ‘delinquency’. Increases of up to 5-10% are not unheard of.

Dos and Don’ts for Credit Cards and Managing Credit Card Debt

What Can I Do About Rising Interest Rates?

The single biggest and best thing you can do to prevent or mitigate being impacted by interest rate increases is to pay down as much of your debt as possible – and even if you’re mainly carrying debts not likely to be impacted by rate hikes, the sooner you get out of debt the better.

• Calculate your “Rule of 60 Math”: Add up your total (non-mortgage) debt then divide that number by 60.
  • Is that figure a monthly payment you could afford to pay so that you’ll have your debt paid off in five years (60 months)?
  • If that hypothetical payment is not affordable for you, or you think it would be difficult to consistently manage, connect with a Licensed Insolvency Trustee about your options for dealing with debt – especially if you’re already in (or are approaching) a position of being over-extended.
• If you’re a mortgage holder, you may want to research options for locking in your mortgage to a fixed rate. Though often more expensive in the long-term, a fixed rate mortgage can give you certainty for your budget.
  • Be sure to shop around for the best rates and consider using a mortgage broker.
• Proceed with caution if you’re considering restructuring your debts with consolidation loans or balance transfers – it’s important to fully understand the full costs of borrowing before signing any documents.
  • If your credit history has been impacted by an unfavourable debt to income ratio you may find it difficult to qualify for a line of credit or consolidation loan at a low interest rate, or at all.
  • Make sure you can realistically stick to the budget needed to get your debt paid off and are not simply delaying an inevitable cash-crunch.

Learn More About Credit Reports and Scores in Canada

Consolidate and Cut Your Debt – Without Borrowing

Although you might consider a new loan or line of credit, a Consumer Proposal provides a welcome alternative to consolidate your debt without turning to more borrowing and paying interest charges:

• A Consumer Proposal allows you to pay off your consolidated debts without any further interest charges, and your creditors will agree to accept repayment of typically as little as 20-50% of your balance due, in full settlement of your accounts.
  • Virtually all types of debts can be consolidated and reduced with a Consumer Proposal – from credit cards to lines of credit, overdrafts, income tax debt, CERB overpayments, student loans and more.
• Your credit history or credit score are not factors for eligibility, and no co-signer is needed.
• You can pay off a Consumer Proposal early at any time without penalty.

Connect with a local BC Licensed Insolvency Trustee to learn more about Consumer Proposals and explore your options.

Licensed Insolvency Trustee Blair Mantin Talks Interest Rates and Debt Solutions

Sands & Associates President and Licensed Insolvency Trustee Blair Mantin joined Global News and Breakfast Television Vancouver to discuss what Canadian consumers should know about interest rates and debts, including what you can do to deal with problem debt. Watch the clips here:

Sands & Associates’ local office network serves communities across BC, and our full suite of debt help services is available online, by phone, or in-person. Connect today at no cost to discuss your situation and learn about your options.

The post Understanding Interest Rates – and Why They Matter if You Have Debt appeared first on Sands & Associates.

Blair Mantin, Sands & Associates President and Licensed Insolvency Trustee shares more about helping consumers deal with a debt problem:

“Debt is a problem like many others in that it does have a solution – and we’re here to help you understand all of your options and move forward with the plan that’s right for you and your situation. We believe that financial issues can happen to anyone, and that you owe it to yourself to get debt help.

For over 35 years Sands & Associates has been a part of our local communities, supporting BC consumers facing debt challenges. Our team of Licensed Insolvency Trustees, Insolvency Estate Managers and Qualified Counsellors is made up of professionals who are not only qualified and experienced in helping people get out of debt, but committed to doing so in a way that makes everyone feel respected, heard, and valued.

Whether you are facing an urgent debt issue or looking for a better way to pay off your debt, Sands & Associates is here for you with support, solutions – and no judgment.”

Sands & Associates offers complete debt relief services at local offices throughout the province, as well as over the phone and online. Book a free, confidential and non-judgmental consultation today to get advice and a plan to be debt-free.

Do I Qualify for Debt Help? 

If you need debt advice or think you might have a debt problem, a Licensed Insolvency Trustee is the right professional to help you. Simply get in touch with a local Licensed Insolvency Trustee directly to request a free one-on-one consultation to talk about your situation and get confidential advice.

You don’t need to meet any qualifiers or be facing an extreme situation, such as being sued by a creditor, to seek debt help from a Licensed Insolvency Trustee. Some common situations that we help with include, but are not limited to:

• You’re experiencing stress about your debt and ability to make your monthly payments.
• You’ve been looking for ways to manage your debt more effectively.
• You worry about escalating creditor action or increasing account balances.
• You’re not able to pay much more than the required minimum monthly payments on your credit card or other balances.
• You make payments each month but are then forced to use your credit again to pay regular bills or household expenses.
• You’ve consolidated your debt but still feel financially squeezed.
• You feel prevented from moving forward because of old debts, or debts that are taking you a long time to pay off.
• Your current pace of debt repayment will have you making (non-mortgage) debt payments for more than five years.

In less than an hour we can help you understand your situation, explore all your options to deal with your debt, and help you take the next steps in the plan you choose. Get started today with a free, confidential debt consultation. 

Debt Relief for Canadians

In Canada, consumers have two different options for debt relief that will allow you to have some – or all – of your debts completely forgiven and legally extinguished. These options are:

Filing a Consumer Proposal: This legal consolidation solution offers consumers debt relief with a plan that will:

• Consolidate virtually all your debt without borrowing, interest charges or added fees.
• Allow you to repay your creditors the portion of your debt that you can afford, in full and final settlement (cutting up to 50-80% of your total consolidated debt is common).
• Prohibit creditors from pursuing you for payment, collections, or ongoing interest.
• Provide a debt restructuring plan of up to five years, with a clear debt-free end date.

Declaring Bankruptcy: Where an individual can’t afford to repay a portion of their debt through a Consumer Proposal, personal bankruptcy is an alternative option for debt relief that can allow you to have up to 100% of your debts forgiven (even government debts):

• You do not need to ask your creditors’ permission to file for bankruptcy, and you will get immediate protection from your creditors.
• Most bankruptcies in Canada take only nine months to complete, and you only pay an administrative cost which is usually broken into payments over this time.
• Bankruptcy does not permanently impact your credit history, and you can usually re-establish a positive credit history within two or three years.

These two debt relief solutions are only available through working with a Licensed Insolvency Trustee and are the only options available for consumers to legally have their debts forgiven. Don’t be fooled by other agents or advertisements! Ask “Are you a Licensed Insolvency Trustee?” 

You don’t have to solve your debt problem alone – everyone deserves to live with dignity, and without the overwhelming stress of debt. Speak with a Licensed Insolvency Trustee about your concerns and get guidance and a personalized debt-free plan so you can move forward and live your best life – without debt.

Connect with a friendly, local debt expert who cares and get started with the debt-free plan that’s right for you – Book your free, confidential debt consultation today.

The post Office Spotlight: Sands & Associates Mission appeared first on Sands & Associates.

What is a Consumer Proposal, and How Does it Consolidate my Debt?

A Consumer Proposal is a legal debt relief option that allows you to consolidate your debt and make an agreement with your creditors to settle your debts in full by repaying what’s affordable for you. After you repay the portion of your total consolidated debt as agreed, your creditors will consider the unpaid balance legally forgiven.

Consumer Proposals can be used to consolidate virtually all types of debt – and you can often cut your debt considerably – anywhere from 50% up to 80% or more – including (but not limited to):

• Credit cards, overdrafts, lines of credit, payday loans
• Government debts such as income tax debt, business GST debt, CERB overpayments
• Student loans (government and bank-loaned)

To do a Consumer Proposal you’ll work with a Licensed Insolvency Trustee who will help you come up with a fair Consumer Proposal offer, and will then manage communications with your creditors and facilitate their payments. You’ll also receive guidance and support throughout the Consumer Proposal with two detailed financial counselling sessions forming an integral part of the process.

Consumer Proposals are very flexible and are tailored to fit each person’s unique circumstances – for example, you might offer a single lump-sum payment, or offer monthly payments for as long as 60 months (five years). Here’s an example of what a Consumer Proposal might look like for you:

If you have various debts that total $25,000 and you’re trying to pay them off in five years with an interest rate of 18%, you would need to make payments of around $635/month for five years…

• Meeting with a Licensed Insolvency Trustee, you decide you can afford to pay around $200/month on your debt, so you offer your creditors a Consumer Proposal where you’ll repay a total of $7,500 – 30% of your debt – by making monthly payments of approximately $210/month for 36 months.
  • Your debts are frozen, with no more interest charges from your creditors, and no borrowing is involved, so you’re not paying any interest costs on the consolidated balance either.
• These payments ($210 per month in this example) are all you need to pay towards your debts being consolidated in your Consumer Proposal – there are no added fees or costs; you make just the one simple monthly payment.
  • If you have a mortgage or vehicle financing agreement that you are going to keep, you can continue to pay these as usual, outside of your Consumer Proposal.
• Once you’ve completed all the terms of your Consumer Proposal – that’s it! Your creditors will be required to legally write-off the unpaid balances and your debts are considered cleared!

Try our Debt Options Calculator to See More Consumer Proposal Examples

Do I Need a Loan to do a Consumer Proposal?

A Consumer Proposal is NOT a loan or borrowing agreement, it is a legal debt solution – and it can only be filed by working with a Licensed Insolvency Trustee; no other professionals or agents are authorized to file a Consumer Proposal for you.

If you are interested in consolidating (and cutting) your debt with a Consumer Proposal and the representative you are working with offers you a loan, this should be a red flag that:

1. You may not be talking with a Licensed Insolvency Trustee, but rather a debt agent or third-party referral source – who may eventually introduce you to a Licensed Insolvency Trustee; and,
2. You may be pressured to pay for financing or other services that you simply don’t need.

Licensed Insolvency Trustees are not lenders, we are Canada’s only officially recognized and qualified debt help professionals:

• You do not need any sort of referral or additional agent working with you to do a Consumer Proposal or connect with a Licensed Insolvency Trustee – just get in touch directly with a Licensed Insolvency Trustee local to your province.
• You do not need to make payments to any agents to ‘build up’ money towards your Consumer Proposal – this suggestion would also be a red flag that you may not be dealing with a Licensed Insolvency Trustee.
  • Most Licensed Insolvency Trustees will recommend either that you make your first monthly Consumer Proposal payment at the time you sign your official Consumer Proposal documents, or shortly after.
  • At Sands & Associates we do not charge any upfront fee to start your Consumer Proposal – you just start paying the proposal once it’s been filed, and you are no longer required to make any payments on the debts consolidated in the Consumer Proposal, which places most clients in a much-improved financial situation right away.

As well as debt agents who charge unnecessary fees for referrals or ‘pre-Proposal’ administrative services, there are also lenders (and their referral agents) who might offer or encourage you to take out a loan to pay off or ‘exit’ your Consumer Proposal. These are unnecessary and, in some ways, un-do some of the key benefits you gained from consolidating your debt with an interest-free Consumer Proposal.

Consumer Proposal ‘Exit’ Loans

Consumer Proposal ‘exit loans’ are often advertised to help you quickly pay off your Consumer Proposal, and in turn, shorten the time it takes until your Consumer Proposal is wiped from your credit history. Many of these ‘exit loan’ providers advertise in a way that creates urgency, over-inflating the importance of fast-tracking a high credit score.

A Consumer Proposal will show on your credit history for three years after you finish paying the Proposal off – OR for six years from the date you started it, whichever comes first. For example:

• If you file your Consumer Proposal in May 2023 and it takes you until April 2026 to pay it off, the Consumer Proposal will be cleared from your credit history in 2029.
• If you file your Consumer Proposal in May 2023 and it takes you until April 2028 to pay it off, the Consumer Proposal would clear from your credit history in 2029.
  • This credit rating impact is similar to the impact of following a credit counselling repayment plan, even though credit counselling debt management plans don’t allow you to reduce your debt.

Learn More About Credit Rebuilding After Your Consumer Proposal

What you need to be aware of is that even though your Consumer Proposal is still showing on you credit history, you are not prevented from seeking new credit. It is still possible to get a new credit card, renew your mortgage, finance a vehicle, etc. during the term of your Consumer Proposal.

• Most people do well to start with a secured credit card with a lower limit that reports payment history to a credit bureau, since this will allow you to have the convenience of a credit card and some credit history benefit – but without the risk of accumulating a big balance.

It’s also very important to understand that there is no real way to instantly boost your credit rating. Your credit rating is tied to your credit history, and building a positive credit history simply takes time, and the right actions. Fortunately, you have control here, with the most important factors being:

• Paying all your bills on time every time
• Demonstrating consistent employment history
• Getting a new credit account and using it responsibly
• Keeping balances under 50% of the total credit limit

These are just a few examples of good credit use habits, and during your Consumer Proposal you’ll have the opportunity to get more resources and tools during your financial counselling sessions with a Qualified Insolvency Counsellor – this is built into the Consumer Proposal process.

Problems with Consumer Proposal ‘Exit’ Loans

While you may be able to take out a loan to pay off your Consumer Proposal early and start rebuilding your credit history sooner, these loans often come at a high cost:

• Using a loan to pay off a Consumer Proposal negates the interest-free perk of a Consumer Proposal.
• Proposal exit loans may be offered at interest rates ranging from as much as 19-32%, or even 40%+.
• Lenders that offer these types of loans are likely to tack on administration and legal fees which might range between $300-$1500, as well as additional (optional) loan protection insurance.
• Loan terms commonly range from 36-84 months and may have minimum terms – so the time it takes you to become debt-free may be even longer than if you had just kept paying your Consumer Proposal as agreed.

Revisiting our prior Consumer Proposal example where you were dealing with $25,000 of debt and had arranged to repay $7,500 in total at $210/month for 36 months – imagine if you’ve paid for one year and have another $5,000 left to pay, then take out an exit loan with a 20% interest rate to finish your Consumer Proposal early. If your loan term was for two years you may be facing:

• Now paying around $255/month for your loan repayment, and the loan’s total interest will cost you $1,100 – PLUS the administration and legal fees – all of which you would have avoided if you’d kept going with your interest-free Consumer Proposal!

Is this worth resetting your credit history two years earlier than planned? For most people – the answer is a clear no!

Whether you’re in a Consumer Proposal or not, the advice of Licensed Insolvency Trustees is often the same: that individuals should prioritize paying off debt and becoming debt-free above a high credit score. Credit scores are always changing, and you may substantially change yours in just a few short years – whereas the costs of carrying debt with interest can take a toll far longer, and can limit how you are able to use your income.

• Carefully consider the costs and reasons for taking out a loan or other financing to pay off your Consumer Proposal before moving forward. In most cases, the high costs of borrowing against the early credit history reset just don’t add up – not to mention that you risk ending up with an unmanageable or long-term debt again!

Some agents will use high-pressure sales tactics to get you into a Consumer Proposal loan, or make unrealistic promises of being able to quickly fix your credit rating. If you still want to work with an agent, be aware that unregulated and unlicensed debt agents often charge individuals thousands of dollars for unnecessary services, or services they are not qualified to provide – both before, during and after a Consumer Proposal. Be on the lookout for tactics such as:

• Offering you financing with high fees and high interest rates.
• Encouraging you to stop making your bill payments to accumulate a lump-sum settlement.
• Suggesting you use your credit to pay their fees.

Also, if anyone besides a Licensed Insolvency Trustee recommends you NOT file a Consumer Proposal, ALWAYS get a second opinion. Remember, only a Licensed Insolvency Trustee is authorized to advise you on a Consumer Proposal, and file one for you. The best thing to do is simply ask “Are you a Licensed Insolvency Trustee?”

What Does it Mean for Me if My Spouse Files a Consumer Proposal? Learn More

How Can I Finish my Consumer Proposal Early, Without a Loan?

With a Consumer Proposal, you’ll have a clear debt-free date in five years or less – and some people complete their Consumer Proposal ahead of schedule. Absolutely – if you can or want to – you can pay off your Consumer Proposal early, at any time, with no penalty or hassle.

If you want to aim to finish your Consumer Proposal sooner than planned, you might:

• Increase your monthly payments or increase your payment frequency – say from monthly to biweekly, so you get in extra payments.
• Make additional payments as you have extra cash available, whether from your regular income, or even from irregular funds like a tax refund.

Get Advice About Consumer Proposals and Other Debt Solutions

If you’re wondering about ways to consolidate or settle your debt or want to learn more about how a Consumer Proposal could work for you the next step is to connect directly with a local Licensed Insolvency Trustee in your province. Remember, there is no cost or commitment required to have a conversation with a qualified professional (a Licensed Insolvency Trustee) about your situation and all the options you have.

• Sands & Associates’ Licensed Insolvency Trustees provide safe, unbiased, and non-judgmental advice and we work with BC residents across the province.
• We will take the time to understand your situation, needs, and goals – our goal is that you have all the information to make the decision about what’s best for YOU and your debt-free plan.
• In under an hour, we can help you better understand your options, and provide you clear next steps – and all of our advice comes at no charge to you.

Get support and solutions – and a debt-free plan that’s right for you. Book your free, confidential consultation with a caring, local Sands & Associates debt expert today.

The post How Do I Get a Consumer Proposal Loan? appeared first on Sands & Associates.

Watch the clip here, and read more below:

Potentially Risky Consumer Debts

Although these two common types of credit can offer a short-term benefit, use caution when taking on these debts, where payments can easily become unmanageable:

Long-Term Vehicle Financing: Many people finance a vehicle, which is not necessarily a problem – but financing terms are now longer than ever. Even though committing to a five, seven, or even eight-year financing term is becoming more common, consider the risks of doing so:

• Making an unaffordable vehicle ‘affordable’ by stretching out payments over a longer term.
• Investing in an asset that will rapidly depreciate (the exact opposite of a mortgage, where your investment is expected to increase in value).
• Extended car payments can take up a big portion of your household income that could be used for savings, retirement, or even paying off other debts.

Credit Card Balances: Your credit has already been used and now you’re committed to the payments – and the worst part about credit card debt – the high interest that accumulates on often long forgotten purchases.

• If you’re not able to pay your balance in full each month it’s easy for credit card debt to add up over time, and this often happens through frequently overspending, sometimes as a direct result of having insufficient income to meet both your household costs AND debt payments.
• The ‘borrow-repay-borrow’ cycle can be almost impossible to break.
• With an interest rate of 24% (a mid-level rate for most bank and department store cards) your debt will double every three years!
• Making only minimum monthly payments (or slightly more than) means even a relatively small balance can take years to pay off. For example, a $6,000 debt could take 40 years+ to pay off making only your minimum monthly payments and you would pay several times more in interest charges than the actual amount that you originally borrowed.

Compare Monthly Payments with Our Debt Options Calculator

Most Risky Consumer Debts

These types of debts can point to an urgent debt problem, either present – or waiting to reveal itself:

Payday or ‘Fast Cash’ Loans: Payday loans are usually a ‘last resort’ type of debt used to meet daily living expenses in a hurry. Because the borrowing fees and interest charges on payday loans are extremely high, using payday loans or ‘fast cash’ advances creates a major risk of kicking off a borrowing cycle that can be even more difficult than credit cards.

• This type of borrowing often leads to people carrying multiple payday loans. It’s not uncommon for people to become trapped in a cycle of payday loans, to have up to a dozen different loans outstanding at the same time.

Canada Revenue Agency Debts: Whether an unpaid balance for income taxes, business GST, or CERB overpayment – an outstanding government debt is not to be taken lightly.

• The government has powerful collection actions at their disposal, and, unlike many other creditors, Canada Revenue Agency can start collection action virtually overnight. You may not learn of pending action until it is already in place, including wage garnishment/seizure, a bank account freeze, or a lien placed on your property.

If you find yourself unable to repay your government debt, or in a situation where collection action is escalating, talk with a Licensed Insolvency Trustee as soon as possible.

Learn More About Solutions for Having Government Debts Forgiven

Consumer Debts to Be Cautious Of

There are two additional types of consumer debt to be cautious of, particularly when it comes to trying to manage debt you already have:

Co-Signing Debt: As Licensed Insolvency Trustees we’re regularly asked when it would be advisable to co-sign a debt for someone else – our answer: almost never!

• Co-signed debts are not a 50/50 liability as many people believe – each person on the account is responsible for 100% of the unpaid debt if the other person does not pay.
• Getting a co-signer when you’re already struggling financially often just introduces additional layers of stress and emotional responsibility – you’ve now given that creditor another responsible party to pursue for payment.
• Conversely, if you’re considering co-signing for someone else, understand that you are potentially letting someone else impact your monthly financial commitments and credit rating.

Read More About Co-Signing Debts

Using Assets as Collateral: Particularly if you are seeking to consolidate debt by borrowing, lenders may require you to pledge to them security over an asset to get a loan.

• Like co-signing, in the event you are unable to meet your repayment terms, your creditor now has additional recourse to collect upon the debt, which could include seizing and forcing the sale of the pledged asset.
• Be especially careful before taking on additional charges against your home equity – you only have so much to borrow against, not to mention potentially leaving yourself vulnerable to an interest rate increase or downturn in the housing market.

Learn More About Options to Consolidate Your Debt

Where to Get Debt Help in BC

If you have concerns about any of your debts or are considering what you can do to manage your debt, reach out to a local Licensed Insolvency Trustee in your province. You can safely get confidential support from a qualified and unbiased professional by contacting a Licensed Insolvency Trustee for a free debt consultation.

Sands & Associates’ team of debt help experts work with people across British Columbia and our full suite of debt help services is available in person from local offices around the province, over the phone, or online – whatever is most comfortable and convenient for you.

Your debt-free future IS possible and may be closer than you think. Connect with a caring, non-judgmental Licensed Insolvency Trustee today – book your free, confidential consultation now.

The post Risky Consumer Debts – and What to Watch For appeared first on Sands & Associates.

As consumers face tough financial demands, Sands & Associates, BC’s largest firm of Licensed Insolvency Trustees focused exclusively on providing debt help services to individuals, is seeing a substantial increase in the number of BC residents seeking professional debt advice and debt relief support. President of Sands & Associates, Licensed Insolvency Trustee Blair Mantin joined Global News to share more on consumers’ growing financial concerns, and what you should know if you’re a BC resident facing a debt problem.

Watch the clip here and read on to learn more about what to watch for across the province.

Carrying Consumer Debt? Here’s the Latest You Should Be Aware Of

Creditors Are Significantly Ramping Up Collection Tactics

In 2020 BC courts were closed and many creditors were extending payment deferrals to their customers.  It’s safe to say that this leniency has now passed and it’s back to ‘business as usual’. In 2023 so far, creditors seem to be taking a noticeably more aggressive approach to collections, with legal actions increasing even for relatively low account balances.

• Individuals owing as little as $5,000 are now finding themselves being sued for payments; in previous years this was generally a risk only where a debt exceeded $20,000.
• Local Sands & Associates Licensed Insolvency Trustees are noticing a trend of individuals seeking urgent debt help because creditors owed these smaller balances have taken them to court and obtained wage seizure orders which often make it impossible for an individual to cover their regular monthly costs of living.

What Consumers Should Know: If you are facing a wage garnishment (or the threat of one) by a creditor, a Licensed Insolvency Trustee can help you make a Consumer Proposal or alternatively file personal bankruptcy, both of which will immediately stop this creditor action. 

Learn more about Wage Garnishments and How to Stop a Creditor with a Garnishment Order

The Number of Consumers Turning to Consumer Proposals is Growing Substantially

A Consumer Proposal is a unique type of legal debt consolidation and an alternative to both personal bankruptcy and debt consolidation loans. Working with a Licensed Insolvency Trustee, an individual will make an offer to their creditors to repay the portion of their debt they can afford (often as little as 20-30 cents on the dollar), with no interest charges and no added administration costs.

The Office of the Superintendent of Bankruptcy (the Federal branch that oversees all insolvency filings) released recent statistics which illustrate how popular Consumer Proposals are becoming for cash-strapped consumers seeking to consolidate and cut their debt:

• The number of Consumer Proposals filed in BC in February 2023 compared to February 2022 increased by a whopping 38%. (And the number of bankruptcies filed over the same period declined by 8%.)
  • A Consumer Proposal is now the option chosen by 84% of people who file formal insolvency proceedings, which is a huge jump from 62% of customers choosing this option in February of 2020
• Overall, there was a year-over-year increase of 28% in the total number of BC residents filing formal insolvency proceedings to deal with their debts, which indicates that although many people are struggling, they are increasingly finding relief by restructuring their debts to offer partial repayment, instead of filing for bankruptcy.

What Consumers Should Know: You do not need to be delinquent on your payments to consider a debt restructuring solution like a Consumer Proposal – also, know that bankruptcy is not your only option for debt relief!

Learn more about Consumer Proposals and Whether a Consumer Proposal Could Be Right for You

Canada Revenue Agency (CRA) is Offering More Time to Pay Balances

Prior to 2020, CRA would typically accommodate a six-month payment plan for individuals to repay a balance owing in full, and it was rare for leniency to extend beyond that time, or in getting relief from penalties and interest charges. Now in 2023 CRA has extended this period to as long as 12 months in cases where they believe the six-month plan would create hardship for the individual.

• Despite this increased repayment timeline, however, for many individuals this is still not enough, especially as another trend contributes to the significant growth in Consumer Proposals – people being pursued for a CERB overpayment, with no means to afford to repay the debt within 12 months, even if the interest and penalties are waived.

What Consumers Should Know: If you have an unmanageable balance owing to CRA a Consumer Proposal is the only means of negotiating your debt to CRA (or having it forgiven with bankruptcy). Also, if CRA has begun collections against you, other than paying the debt in full, only a Licensed Insolvency Trustee can help you with options to get them to stop.

Learn more about What Happens if You Can’t Afford Your CERB Repayment

“Buyer Beware” – Impact of Unlicensed Debt Consultants Increasing in BC

Consumer warnings are being echoed by many Licensed Insolvency Trustees as a resurging presence of unlicensed ‘debt advisory’ firms have begun attracting BC consumers. These unlicensed and largely unregulated agents typically take advantage of vulnerable consumers, collecting money from people seeking debt help these agencies simply can’t provide. Here’s how it often works:

• An individual reaches out for help and is charged fees in the range of 1-2% of their total debt. The advisor explains how a Consumer Proposal can work to help them, and after they’ve collected their fee (often over two or three months) the consumer is eventually introduced to a Licensed Insolvency Trustee – the only professional who can actually file a Consumer Proposal.
  • This is completely unethical as every Licensed Insolvency Trustee in Canada offers a free, confidential consultation to review your financial options – and most, including Sands & Associates – will file a Consumer Proposal for you with no up-front payments whatsoever!

Despite advertising promises and even A+ BBB ratings and positive reviews, there is no such thing as ‘government debt grants’ or ‘programs’ beyond what is available to consumers by working with a Licensed Insolvency Trustee.

• When seeking debt advice, you should always ask “Are you a Licensed Insolvency Trustee?”
• If you’re not dealing with a Licensed Insolvency Trustee, it’s highly likely you are unnecessarily paying money that is providing no value, and you may be the victim of a growing scam in BC.

What Consumers Should Know: Licensed Insolvency Trustees are Canada’s ONLY regulated, endorsed, and qualified debt help professionals. You do not need a referral to get safe, free, and confidential advice from a Licensed Insolvency Trustee – simply contact a Licensed Insolvency Trustee local to your province. It should never cost you money to find out what your options are!

Learn about resources and options to help you become debt-free faster – book your free, confidential consultation with a non-judgmental debt expert today.

The post British Columbians Struggling with Unmanageable Debt as Personal Insolvencies Surge appeared first on Sands & Associates.