Why Solutions Credit Counselling is trusted by Canadians

  • FREE Credit Counselling Service
  • Elimination of Debt Collectors' calls
  • We work for You –
      • Bankruptcy Trustees are Officers of the Court
      • We are not funded by the creditors you owe money to
  • We do everything we can to save you money
  • Debt Consolidation may improve your credit score – Bankruptcy may lower your score
  • Our Debt Consolidation process can offer interest rates as low as 0%
  • Payments are based on your budget – repay your creditors based on your ability to do so
  • We will help you to deal with Payday Loan companies

Get started now!

Debt Relief News & Advice

How does debt consolidation work?

In essence, it is combining multiple debts into one payment for the benefit of simplicity, lower interest fees and lower monthly payments.  People often talk about debt consolidation, but did you know there are 3 different avenues to this vague catch phrase? Consolidation loans are probably the most well-known type of debt consolidation, because they are probably the most marketed. Mortgage consolidation, that is, refinancing your mortgage to consolidate debt, is a popular option for homeowners with significant equity and a relatively high interest rate mortgage. Debt consolidation programs, also known as credit counselling, is the third and probably lesser known type of debt consolidation.

Consolidation Loans

Consolidation loans are one way to consolidate debt. Once approved for the consolidation loan, your current high-interest debt (such as credit card debt) is transferred to the consolidation loan by way of paying it off with the loan. The consolidation loan will have a lower interest rate than credit cards and other high-interest debt, however it will not be as low as a mortgage interest rate or other secured credit interest rates.

Many people choose consolidation loans simply because they do not qualify for the mortgage refinancing consolidation (or it doesn’t make fiscal sense in their situation) as well because they are unaware of credit counselling consolidation programs. One thing to consider here: are you shuffling your debt from one place to another? Do you have a specific and reasonable timeline in which the debt will be paid off?

Consolidating Your Mortgage

Consolidating your mortgage means increasing your mortgage principal and/or amortization period in order to “free up equity” to pay off high-interest debt. The debt is essentially being transferred from credit cards, etc. to your mortgage. Again you are consolidating into one easy payment and reducing interest fees and monthly payments. But with this option there are criteria which must be met in order to be beneficial, and there are nuanced negatives as well.

1. You need enough equity. Your new expanded mortgage will only be approved up to 80%-85% of your home’s equity, so you had better have significant equity already in order to cover your debts and the fees associated with this option (more on that below).

2. You need a lower interest rate. Your refinanced mortgage will need to be at least 1% lower interest rate than it is currently in order to balance out the fees and extended payments of the consolidated debt.

3. You have to cover the fees. If you refinance in the middle of your mortgage term, you will have to pay an early payout penalty, which could be between 3%-6% of your mortgage depending on your specific mortgage terms. As well, if your new mortgage requires mortgage insurance you will have to add that to the bill. You may also have to pay legal fees involved with having your home value assessed, and other legal requirements of mortgage refinancing. Ask your mortgage lender for details of all fees and costs incurred before refinancing.

4. When it comes to mortgage consolidation, you are talking about extending the life of your previously unsecured debt for a much longer period of time. For example that vacation you put on credit card and then consolidated to your mortgage is now going to take 25 years to pay off, along with all the other debt, as opposed to being paid off in the short term.

5. Another subtle setback of the mortgage consolidation route is reduced equity in the home and a higher likelihood of bankruptcy down the road. Many people who have acquired high interest debt and managed to reduce their payments with mortgage consolidation are still in the habit of living beyond their means and acquiring new debt. If you will be likely to use your monthly savings for repaying the mortgage faster, as well as saving for retirement and emergencies (preventing the need for future debt) then this strategy could work for you. However if you continue to acquire debt as you had before, then you are using your equity to increase your debt load, and setting out on the path to bankruptcy.

Debt Consolidation Programs

Debt consolidation programs are very different from consolidation loans and mortgage refinancing because they do not involve any new credit. The Credit Counsellors who offer these programs become a bridge between you and all of your unsecured lenders - they accept one monthly payment from you and disperse that to all of your creditors. The high interest rates are reduced by the creditors via their written agreement when you sign on to the debt consolidation program.

The catch, although many times a benefit, is that debt consolidation programs are mandated by the government to extend a period of no longer than five years. This means that your unsecured debts will be repaid within five years or less (great!) although it may mean that your monthly payments on these debts will be higher than with the other consolidation options, simply because you are paying if off faster.

For some, the monthly payments will be too high because their income has recently decreased or because their unsecured debt level is extremely high. But if you can afford to repay your debts within five years at the reduced interest rate, then a debt consolidation program could be an excellent option for you. To see if you quality and how much your monthly payment would be, contact Solutions Credit Counselling for a free consultation.

Debt consolidation takes many forms and assumes many names, so if you have unsecured debt to pay off I encourage you to do your homework, become familiar with the terms and know your options to find out which is the best decision for you. If you would like to talk to a credit counsellor to learn about all of your debt consolidation options, call toll-free 1-877-588-9491.

Do you need relief from payday loans? Many people like you get caught in what’s known as the “payday loan cycle”, a ‘borrowing from Peter to pay Paul’ situation where you are juggling payday loans from multiple lenders, trying to keep all of the balls in the air. The sweat begins to trickle down your forehead because you can’t see when it will end, and if you stumble, all the balls will come crashing down, leading to collection calls and wage garnishment. The problem is you don’t know where to turn, and you don’t have the money to pay back everyone on top of your regular costs of living.



How to get good Credit … How to keep it…if you want to …

Computers have changed the world! Credit is now much easier to get! I am not sure that is a good thing…..

With respect to credit, the Canadian Human Rights Act forbids discrimination on the grounds of race, national or ethnic origin, colour, religion, age, sex, marital status or conviction for an offence for which a pardon has been granted.

Credit grantors extend their credit to consumers using a variety of propriety business standards and systems, as well as using the credit information from credit reporting agencies also called credit bureaus.

A good credit record can be a valuable tool that provides access to funds in order to help consumers make major purchases such as education, homes, cars, appliances, or even to travel our world. A good credit record makes things accessible, the buy now pay later mind set. Most banking and lending institutions will be more than pleased to “sell” you some money if you have good credit.

General Guidelines:

Tips for the New Credit Application:

It can be a frustrating experience for a person to establish their first credit record. The question they often ask is: How can I establish a credit record? Where do I start?”

Here are a few suggestions:

1. Establish a stable address and job; if you tend to move around a lot – use your parents address until you get established. (if they are stable)

2. Open and maintain a chequing and a savings account. If possible save money every pay period no matter how small the amount. An established chequing and or savings account will help to show that you have good money management skills;

3. Apply for your financial institution’s package deal for personal financial services. This kind of account often includes an all-purpose credit card. Get a low limit on your card.

4. You could apply for a first credit card at your local department store; sometimes it is easier to get credit from department stores;

5. If you drive, you could apply for a credit card from a gasoline company; only use this card for gas and always pay it in full when the bill arrives;

6. If you are approved for a loan from a financial institution such as a bank, credit union or finance company, be sure to repay the loan promptly, and always make your payments as agreed and on time;

7. Always know who you are dealing with and deal with reputable firms;

8. Every time your credit bureau file is pulled (unless you pull your own) you lose points; so we recommend that you Do Not apply for more than one credit item every three months;

What if your circumstances change?

Personal relationships can affect your credit rating in that your ability to obtain credit can be affected, particularly if one person has a poor credit record. However, one partner’s poor credit record does not necessarily influence the other partner’s credit worthiness.
When a major purchase such as a car or a house is made from joint income, credit grantors could combine both your credit records and consider you as a unit. In this situation, a poor credit record could lessen the value of the other’s good record. So you might want to avoid this and apply on your own.
Credit grantors are allowed to ask questions about your total family income when you apply for credit in order to determine if you are able to repay the debt. Especially if they feel you may be applying for more credit than you yourself can afford based on your own income.
In your relationship, whether you work or not, you should consider either maintaining the credit record you had before you were married, or consider establishing one of your own. You can maintain your own good credit history by keeping your own credit and bank account, and not applying to have your spouse added for joint responsibility. I highly recommend this – keep your credit separate. Have your own credit rating!
You might want to obtain a joint account to pay your household bills from however, do not give up your individual bank accounts. Always have accounts in more than one financial institution – that way you will have choices.
Maintain a “debt free” bank or credit union account – make pledge to yourself, never to borrow money from this financial institution.

Separated or Divorced

If you have become separated or divorced, an established and acceptable credit record can be an important asset. It makes obtaining credit easier and less expensive, especially at a time when credit could help you adjustment to your new life.
a) Separated but not divorced
The individual who is separated but not yet divorced has proven to be one of the most difficult areas for credit grantors because the financial circumstances for that individual may not be clear.
Sometimes the animosity between separating spouses can make it difficult to get accounts paid. Many couples have received advice not to pay any accounts until the divorce is final. (Therefore, obtaining additional credit during this time may become a problem. Try to think a head – what are your needs what are your wants.
If circumstances in the relationship change, either party can withdraw privileges to credit by notifying the creditors to stop extending credit. We recommended that a notice be inserted in the newspaper and on your credit report stating “non-responsibility for future credit granted to your spouse” However, filing a notice of non-responsibility does not cancel your contract nor exempt you from your agreement to pay your current creditors. You are still bound to the terms of the credit contract you have signed.

b) The Divorced Individual – another good reason to keep your own bank accounts
If, during marriage, the individuals have had joint credit accounts at various businesses, it is usually recommended that the joint credit account be closed and new individual accounts be opened. If you have an established source of income in your profession and your accounts have previously been handled in a satisfactory manner, there should be no problem opening the new accounts, and in obtaining future credit. This will enable you to obtain or maintain your own credit history in a satisfactory manner. It is important for you to contact all relevant credit grantors directly to apply for the new individual accounts and to request that they report your account history in your name only.

The Widow/Widower

Once a person becomes a widow or widower, it might be advantageous to change any existing accounts. Usually all that is necessary to make the change is to complete a new application form with no notation that the account was previously carried in the deceased spouse’s name. (Advantageous for whom you might ask). Be careful; get professional advice before you make any changes.
The satisfactory performance of the credit account in the past should be sufficient, providing your financial position meets the requirements of the firm, for the account to be transferred to your name.
Only do this if you WANT this credit in your name – remember if you did not sign for it is NOT your debt! Think twice before allowing any creditor to “transfer” a debt into your name from a deceased account.

Remember: if you are experiencing financial problems or want to get financial advice speak to the professionals at Solutions Credit Counselling Service Inc. today – do not wait.

What is a payday loan?

A payday loan, or payday advance, is a short-term loan of usually 14 days, which you promise to pay back, plus fees, after you receive your next paycheque. The loan is often between 30-50% of the amount of your paycheque.

To qualify for a payday loan, you must provide proof that you have a regular income, a permanent address and a bank account. You will have to sign a loan agreement which states the loan interest, fees, and due date. Most of the time you will need to provide a post-dated cheque for the full loan amount including all fees and interest, or sign a form for a pre-authorized debit of your account on the loan due date.

How much do payday loans cost?

Credit Card Debt is the most common form of unsecured debt in Canada. During the past decade Canadian and US credit card companies have been very successful in targeting low income families as their main client. In an effort to cope with a weaker economy many families tend to pay with a credit card for basic necessities thus adding more to their Credit Card Debt. This makes credit card companies really prosper as the less money you pay them each month, the more interest they receive. And the larger the Credit Card Debt gets the sooner families are not able to make even minimum payments creating a very serious problem.

FCAC Consumer Alert - Debt Reduction Companies: Beware of "Too Good to Be True" Offers

We at Solutions Credit Counselling work only for our client – You. We do everything we can to save you money.

The purpose of this is to advise our clients and the public regarding the differences between a Canadian Independent Debt Consolidation and Credit Counselling Agency such as Solutions, and an American Debt Settlement company. Remember, with respect to Debt Settlement companies: “If it sounds too good to be true then it probably is”.

Canada has recently been inundated with American companies, offering “Debt Settlement” services. These questionable “Debt Reduction” operations have been investigated by the U.S. government and recent US legislative changes have forced “Debt Settlement” companies to cease operations in the US. However, many of these “Debt Settlement” companies are now targeting Canadian consumers with false claims of their ability to reduce debt by 40-80% in a short period of time and many Canadians are being lulled into believing these claims.

Reasons to Avoid American Debt Settlement Companies

  • The majority of American Debt Settlement Companies are not Licenced to Operate in Canada. 

If a company is allegedly licensed to perform Debt Settlement operations in the US; that doesn’t automatically permit licensing in Canada. Most provinces require Debt Settlement companies to be licenced and bonded by the respective Provincial Consumer Protection branches. Consumer Protection BC issues licences to debt collectors, bailiffs and debt poolers based on the requirements of the Business Practices and Consumer Protection Act and the Debt Collection Industry Regulation. Unfortunately, it does not appear that Canadian legislation is ideally drafted to deal with this type of company 

  • Call Centres for American Debt Settlement Companies Are Frequently Located in the US, with Only a “Virtual Office” in Canada.

Frequently a settlement company with a Canadian address holds only a Post Office Box which is shared between many companies. There are landlords that offer “virtual offices” for rent with mailing address and receptionist located in Canada. Search the address of the company in Google and determine if any other companies appear in the results with the same location. You can also go to Google Maps and switch to a “Street View” to see if this address is a physical location or just a Post Office Box.

  • American Debt Settlers Are Not Canadian Credit Counsellors.

Employees of an American Debt Settlement company are American citizens, working and living in the US and have little to no knowledge about the Canadian credit industry or financial regulation. When you phone they ask very few questions about your assets and financial situation and without this information it is impossible for a reputable agency to provide a proper Debt Settlement Plan. These companies appear to care only about collecting as many fees as possible, as quickly as they can. Frequently your creditors receive none of these funds.

  • American Debt Settlement Companies’ Fees Are Usually Aggressively Collected.

Fees charged by American Debt Settlement companies often equal the amount of money that they require you to “save” with them. More than half of Canadians who pay fees to these companies end up with more debt and no settlements at the end of the program. American Debt Settlers require you to execute contracts stating that they may collect all fees in advance, prior to providing any service. As soon as you commence paying their fees, your money frequently leaves Canada. And, should you request your money back after not receiving any Debt Settlement services who is available to assist you? Are you prepared to retain an American lawyer in the State where the company is located?

  • American Debt Settlers Have Little to No Relationships with Canadian Creditors.

Canadian Creditors refuse to work with these companies and deal only with reputable established Canadian Debt Collection and Credit Counselling Agencies. Before signing a contract with an American Debt Settlement company, call your creditors and ask if they are prepared to accept a settlement offer from them. Also carefully read the contract you’re considering signing.

  • Canadian Creditors Can Sue You While You’re Paying American Debt Settlers.

American Debt Settlers’ contracts state that they may collect all fees prior to providing any service. That includes not notifying your creditors of their agreement with you. While you keep paying the fees, your creditors are frequently not advised, and do not get paid. They will therefore, seek all legal options available to them to collect outstanding debts from you. They may file a lawsuit against you, obtain judgment, after which they may place a lien on your property, garnish wages or bank accounts and seize property. At that point, a majority of Canadians leave the American Debt Settlement program deeper in debt than before due to accumulated interest, court costs and the like.

  • American Debt Settlers Portray Themselves as a Canadian Companies on their Websites.

This is only one of the many ways American Debt Settlement companies are misleading Canadian consumers and many of us fall for it. Some of these companies have somehow managed to meet the Canadian Presence Requirements (which are minimal), and acquire a .ca website domain name.

  • Perform a Search on a Company You’re Looking at in Google.

Make sure you check online and see what people say about the company, any media coverage and if there have been any lawsuits filed. Some American Debt Settlement companies have changed their name (often more than once), and continue to operate under a different name. Lack of information also should raise concerns.

If you have made an agreement with a Debt Settlement company and have experienced an unfortunate or unforeseen situation please contact us at This email address is being protected from spambots. You need JavaScript enabled to view it. or 1.877.588.9491 ext.119.


At Solutions™ Credit Counselling Services, a Federally Registered Canadian Company that is Government licensed and bonded, we offer an excellent debt settlement service. For more details see our information on Solutions™ debt settlement.