What is debt counselling?
A debt is when you owe someone money or resources. Sometimes people take up excessive debts and are trapped in a situation from which there seems to be no escape. Many people choose to file for bankruptcy in such situations to escape from the debts. However this is a bad idea as it will show up in all the financial documents in your future giving you a bad credit history
Running away to a different country is also a bad idea. This is because firstly you would be required to show you have enough money and resources to move to that country and secondly thanks to technological developments in the recent years it has become very easy for creditors to keep track of debtors
no matter where they are. One alternative to this is to opt for debt counselling.
A debt counselling agency is one which helps debtors pay off their debts little by little. This is done by offering them counselling, voluntarily cutting down their expenditures, coming up with plans to make monthly payments
and also negotiate with the creditors to help both the debtors and creditors come up with a mutually advantageous plan.
They do all this for a nominal fee keeping your current financial situation in mind. Since many of these agencies have extensive experience in coming up with great deals, it is generally better to let them negotiate rather than trying to do it yourself.
The Canada Debt Settlements
is one such debt counselling agency that helps debtors in Canada come up with plans that would help them repay their debts quickly and efficiently. They do not demand for a retainer and begin their negotiations once the funds are available in your account for settlement of the debts.
Some creditors might not be willing to negotiate despite using such debt counseling agencies. The only alternative in that case is to file for bankruptcy. However this would be of disadvantage to the creditors since all they will get is some assets. Therefore most creditors agree to negotiate and come up with deals that would ensure that their money gets repaid.
Another advantage of using debt counselling agencies that they are well versed in the laws that have been passed to protect debtors and can prevent the creditors from harassing you. Most such agencies handle all communications with the creditors and in some countries it becomes illegal for the creditors to continue to have contact with the debtors after this unless the debtor
wishes to continue to have contact with the debtors.
Any constant harassment by the creditors such as repeated phone calls or threatening your family members can be prevented by using these agencies.
, using a debt counselling agency might not show up on your financial documents. Hence they will not affect your credit history. Even if they do show up, it would probably be interpreted as a positive sign.
This is because the creditors will see that you are willing to make payments rather than filing for bankruptcy. This means that when you apply for future loans, you will be seen as someone with a good credit history although you might have delayed on the payments a little.
Make sure to shop for debt counsellors as there are different types and they charge different prices.