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  • Cedit Counselling

  • What is Credit Counselling
    Credit counselling is commonly a process that is used to help individual debtors with debt settlement through education, budgeting and the use of a variety of tools with the goal to reduce and ultimately eliminate debt.
    What is Credit Counsellor
    A Credit Counsellor is the person who provides the credit counselling; they help you find solutions to your financial challenges and problems. This is, however, where it can become a bit complicated because there are no mandatory educational requirements for Credit Counsellors in Canada. For professionals who are committed to being qualified Credit Counsellors, many will further their education through the Accredited Financial Counsellor Canada Program and become accredited after completing 1,000 hours of financial counselling.

    How does it work
    Negotiating with Creditors. One of the chief advantages of consumer credit counselling is that your credit counselling agency will contact your creditors on your behalf to negotiate reduced interest rates on your debt. Credit counsellors stress managing your existing debt principal over reducing it.
    Does it help
    The answer is undoubtedly that debt review is a very good thing for over-indebted consumers. … Though, in the long run, this is actually a very good thing, as it prevents you from racking up more debt and helps you become debt free. |

    While all Credit Counsellors and / or credit counselling agencies and companies in Canada must be licensed in the province in which they work, the two kinds are non-profit credit counselling (also called not-for-profit credit counselling) and for-profit credit counselling.

    Different Approaches to Credit Counselling

    There are two general approaches, or kinds, of credit counselling in Canada, and the approach is tied to the organization or company providing the credit counselling. While all Credit Counsellors and / or credit counselling agencies and companies in Canada must be licensed in the province in which they work, the two kinds are non-profit credit counselling (also called not-for-profit credit counselling) and for-profit credit counselling.

    Talking to and/or getting advice from a credit counselling agency is normally free and has no effect on your credit history whatsoever. However, if your credit card debt is out of control, it’s likely that you’ll end up on what’s called a Debt Management Program, or DMP. These programs are at the heart of the credit counselling industry. What they essentially involve is having the agency get between you and your creditors to help facilitate a payback plan: one that often includes reduced interest rates, waived penalties and fees, and monthly payments you can afford. Once this deal has been worked out, you agree to close any open credit accounts and thereafter send one monthly payment to the counselling agency, which they divide between your creditors. These plans typically last 4-5 years.
    What to do next?
    Contact our Consultants to find out what would be is a better solution for your situation?
    1-Debt Consolidation
    2-Credit Counselling
    3=Consumer Proposal