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Debt Relief Options In BC – Get Help With Your Debt

Statistics show that Canadians are finding it harder to pay their debts. Inflation and higher interest rates have left many with less money, oftentimes having to use credit cards to cover monthly expenses. If you’re finding it challenging to manage all your costs and make your credit payments, you can find debt relief in BC.

Dealing With Your Debt

You’re not alone if you’re struggling with a high debt load. The average debt, excluding mortgages per person in BC was $21,765 at the end of the second quarter of 2023. Repaying debt is especially more challenging now due to the higher cost of living. 

There are several options to consider if you need debt help. You can look into debt consolidation, credit counselling, or the services of a Licensed Insolvency Trustee (LIT).  LITs offer credit counselling, and government-approved debt relief programs, including Consumer Proposals and Bankruptcy.

Debt relief in BC

Everyone’s circumstances are different. There is no ‘one size fits all’ solution. Your goals might include: 

  • Having only one payment.
  • Lowering or eliminating the interest rates on your debt.
  • Reducing the amount you owe.
  • Becoming debt-free.
  • Stopping the legal action, harassment and collection activity from your creditors.

Most debt relief options will accomplish more than one of these goals. Let’s look at the options: debt consolidation loans, credit counselling, debt settlements, Consumer Proposals, and Bankruptcy.

Debt consolidation

A debt consolidation loan will pay off all your debts and leave you with one payment. It’s usually a personal loan or line of credit and can:

  • Lower your interest rate.
  • Give you one payment.
  • Pay off your unsecured debt.

It doesn’t offer legal protection from creditors, and you typically need a good credit rating to qualify for a debt consolidation loan.

Credit counselling

You can find credit counselling from a variety of sources. Financial institutions often offer their customers help understanding their debt and managing credit responsibly. Online resources, such as those through the Financial Consumer Agency of Canada, are also available.

If learning about managing your credit isn’t enough to help you, you can enroll in a credit counselling program with a credit counselling agency. Credit counselling agencies can set up a debt management plan for you by contacting your creditors and having them agree to the plan. A debt management plan will:

  • Give you one payment that works with your monthly budget for all your unsecured debt.
  • Reduce your interest rate, sometimes to zero.
  • Have you debt-free in 36-60 months.
  • Close your credit accounts as you pay them off.

Debt management plans don’t offer legal protection from your creditors and will stay on your credit report for two years after you finish the plan.

Debt settlement

A debt settlement is an agreement you negotiate with your creditors. They take a lump sum for a portion of the amount you owe and write off the rest. This way, they get some of the money you owe them, but you don’t have to pay the total amount. 

Companies and individuals who refer to themselves as debt advisors may offer to negotiate a debt settlement on your behalf for a fee. They may refer you to an LIT for an additional fee if they can’t arrange an accepted solution with your creditors. Unfortunately, some of these debt advisors offering debt settlements are scammers. They take your money but:

  • May fail to negotiate a settlement.
  • Can’t protect you from legal action by your creditors. 
  • Charge a fee to set up an appointment with a LIT that you can do yourself free of charge.

Another possible pitfall of a debt settlement plan is that you need the money available to pay your creditors the lump sum. If you’re having a hard time making your payments, you may not have the cash on hand to do this, or you might need your money for other priorities.

Consumer Proposal

A Consumer Proposal is a government-approved, legally binding debt relief program that the Office of the Superintendent of Bankruptcy (OSB) oversees. You’ll need a Licensed Insolvency Trustee to implement a Consumer Proposal. A Consumer Proposal can:

  • Reduce your unsecured debt by up to 80%.
  • Give you five years to pay off your debts.
  • Allow you to keep your assets.
  • Protect you from collection activity, legal action and wage garnishment from your creditors.
  • Get rid of your unsecured debt.

It will drop off your credit report either three years after you make your last payment or six years after you sign the proposal, whichever comes first.


Personal Bankruptcy may be a solution for you if you’re insolvent. Being insolvent means you cannot pay what you owe based on your income or the money you have. Like a Consumer Proposal, it is a government-approved debt relief program that the Office of the Superintendent of Bankruptcy (OSB) oversees. You need a LIT to file for Bankruptcy on your behalf. Filing for Bankruptcy will:

  • Get rid of your unsecured debts.
  • Let you keep your assets up to the amount your province allows.
  • Stop all collections activities, legal action, and wage garnishments from your creditors.
  • Stay on your credit report for six years after your Bankruptcy is discharged.

It will take between 9-21 months for you to be discharged from Bankruptcy.

Which debt plan is best for you?

The best route to take for your debt will depend on your circumstances. A debt consolidation loan could be the right choice if you just want one payment, have good credit, and have enough income to make payments.

Other options for debt relief in BC, like credit counselling, a debt management plan or a debt settlement, can work too, but you must remember that creditors do not have to accept these plans, you have no legal protection from your creditors, and some providers could charge you high fees and deliver very few results. Some providers are also scammers, so it’s vital to research before you reach out to any of these service providers.

Permanent Debt Solutions

If you’re ready to finally take action to get rid of your debt, contact a Licensed Insolvency Trustee. Our LITs at Allan Marshall and Associates will work with you to find the best solution for you to eliminate your debt. We understand everyone’s circumstances are unique and will find the right option for you.  Wouldn’t you like to be debt-free and free yourself from stress? Contact us online, by email or at 1-888-371-8900 for a free, no-obligation consultation in person or over the phone.

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Mark Marshall BBA, C.I.R.P, L.I.T

Mark has been working in the Insolvency field since graduating from the University of New Brunswick with a degree in Business Administration (BBA). In 2012 Mark received his Chartered Insolvency & Restructuring Professional (CIRP) designation and attained his license as a Licensed Insolvency Trustee (LIT) in 2013.