If your debts feel unmanageable and you need some support, it’s never too late to reach out. Receiving credit counselling in Edmonton from an expert Licensed Insolvency Trustee (LIT) can help to settle your debts and relieve financial anxiety.
If you’re looking for debt consolidation, credit counselling in Edmonton can help you to consolidate and reduce your debts, as well as improve your state of mind. If you’re fearful of filing for Bankruptcy, credit counselling can serve as a great alternative to manage your debts.
Not only does credit counselling help you to manage your debts, it can also prepare you for the future, with budgeting advice and ways to improve your credit score. Finding a Trustee based in Edmonton can provide credit counselling if you need financial support, to get you on the right path towards a brighter future.
What is credit counselling?
Credit counselling is a great way to learn about money and credit management. From budgeting and spending, to assessing your credit report, you can work with an LIT to put together a monthly budget that can help to settle your debts.
You’ll meet with a Trustee who can help support you on your journey to becoming debt free. LITs are trained and regulated by the Federal Government to support people just like you. With their help, you can avoid filing for Bankruptcy and have a plan of action ready to manage your debts.
Your LIT can also contact your creditors on your behalf and ask if they’re willing to reduce or eliminate the interest rates on your debt. They’ll also ask if they’re willing to extend the timeframe you need to pay your debts by.
Is credit counselling right for me?
Wondering if credit counselling is the right option for you? If you have outstanding debts that exceed your income and you need some support, you may consider speaking with an LIT.
You may benefit from credit counselling if:
- You want professional advice: Licensed Insolvency Trustees are experts in debt and credit support. They can provide a range of credit counselling services depending on your situation, from budgeting tips to credit card management.
- You have significant unsecured debt: Your LIT can help you put together a debt management plan to help you repay your unsecured debts, such as loan or credit card repayments.
- You’re looking for debt consolidation: Putting together a debt management plan can help consolidate your debts. Your Trustee can contact your creditors on your behalf to ask if they’re able to reduce or eliminate your debts’ interest rates. They may be able to extend the timeframe for how long you have to repay your debts.
It’s important to note that a debt management plan is not a legal process and your creditors do not have to accept it. Instead, it is a voluntary agreement made between you, your counsellor and your creditors.
How does credit counselling work?
If you decide credit counselling is the right option for you, you’ll meet with an LIT who will assess your situation and discuss your financial goals with you. Perhaps you’re looking to cut back on unnecessary expenses, or you may want to focus on paying off any debts with higher interest rates. You’ll also be able to review any non-essential assets you have that could be sold to repay your debts.
It’s important to remember that while credit counselling can help to resolve financial problems, you can’t erase your credit history, and improving your credit score doesn’t happen overnight. Instead, you’ll need to prove to your creditors that your financial habits have changed and that you can repay your debts on time – which will improve your credit rating over time.
Will credit counselling affect my credit score?
Unlike filing for Bankruptcy or a Consumer Proposal, credit counselling is a debt relief solution that won’t affect your credit score at all. Often, credit counselling is simply a conversation between you and your credit counsellor or LIT, so there is no negative impact on your credit rating.
Credit counselling won’t negatively affect your credit score, and could actually improve it. By putting good financial habits into place, such as budgeting and paying off your debts, you should see your credit score improve over time.
What are credit counselling agencies?
When considering credit counselling, you have two options – working with a credit counselling company or agency, or with a Licensed Insolvency Trustee.
Both a credit counselling company and LITs provide similar services, but do have their differences. When deciding on the best route to take, here are some factors to consider:
- Cost: Unlike a credit counselling company, a Licensed Insolvency Trustee is restricted by what it can charge you by the Bankruptcy Insolvency Act. This means they can provide free consultations and won’t charge you an upfront fee. Whereas, credit counselling companies are often paid a fee from the companies you owe, for collecting the money from you. They may also require you to pay them a fee for negotiating with your creditors.
- Protection: By working with a Trustee, you will receive full protection from creditors when filing a Consumer Proposal or Bankruptcy. If you file for a Consumer Proposal, this can stop interest charges and penalties, and can be less expensive than services offered by credit counselling companies. Whereas, if you choose a credit counsellor, they are not federally licensed so don’t have power over your creditors.
- Limited options: Credit counselling agencies may not have the background to advise you on alternative solutions to your debt and may be limited to just one approach when offering you advice. Whereas, a Licensed Insolvency Trustee is required by law to discuss all of your possible debt relief options, including Bankruptcy and a Consumer Proposal.
- Unrealistic expectations: Watch out for credit counselling companies that make unrealistic guarantees, like promising to make all your debt problems disappear overnight. Credit counselling should help guide you to change your financial habits over time, for long term success. With an LIT, you will receive a free consultation to go through your finances. Then you can decide if credit counselling is the right route to take, or if another debt relief service may suit you best.
Ready to take control of your debts?
Here at Allan Marshall & Associates, we’re passionate about helping people just like you become debt free. It’s never too late to seek help in Edmonton with your debts and improve your financial situation. Contact us today for a free consultation to discuss your credit counselling options and improve your financial wellbeing.
