Why Payday Loans are never a good idea in GTA

Why Payday Loans are never a good idea in GTA

When you need cash for an emergency, you tend to go ahead with a payday loan. In fact, a payday loan would look like the only path of survival. But most of the people who obtain payday loans for their emergency cash needs end up with hassle and frustration in the long run. Therefore, it is important for you to take a look at the unseen aspect of payday loans and take appropriate steps in order to stay away from it.

Below mentioned are some prominent reasons, which would justify why payday loans are never a good idea available for you to consider.

What exactly are payday loans?

Before you take a look at the negative aspects of payday loans, it is better to have a basic understanding of what exactly the payday loans are and what they can lead you to. A payday loan is a kind of a short-term loan. You are borrowing the loan for a couple of weeks. Ideally, you should be in a position to settle this loan on your next payday.

When providing the loan, the lenders will take a look at your bank accounts and income statements. Then they will determine the ability of you to repay the loan by the next payday.

Why shouldn’t you go ahead with payday loans?

Now you know what payday loans are all about. With that in mind, let’s take a look at the reasons why you are never encouraged to go forward with them.

  1. Payday loans are expensive

Payday loans can be considered as one of the most expensive types of loans that you can borrow. If you take a look at an expensive credit card, you will notice that the interest rate is somewhere around 28%. But the interest associated with a payday loan is much above that. For example, if you obtain a payday loan of around $100 for a period of 15 days, you will have to pay a massive annual interest, which goes up to 400%. If you are not in a position to pay such a high amount of money as the interest, you shouldn’t even think about obtaining a payday loan. Usually, most of the people who are not in a position to obtain mainstream loans tend to go ahead with payday loans. It is true that you can easily get cash to your hands with the assistance of a payday loan. But you will have to pay a lot of money out of your pocket for the enhanced convenience offered.

  1. You will get stuck in the payday loans cycle

From recent studies, it has been identified that most of the people who obtain payday loans tend to get stuck in a repeat cycle. This is another reason why you are encouraged to stay away from payday loans. When you obtain a payday loan, you will have to spend a considerable amount of money on your next payday to settle it along with the interest. With this, you will not have enough money to survive until your next payday. Along with that, you will be tempted to go ahead and obtain another payday loan. That’s how you get stuck in a cycle. When you get stuck in this kind of cycle, you will find it a difficult task to overcome it. That’s where your credit ratings would go down.

  1. Your debt will grow fast

Once you obtain a payday loan, your debt will grow fast. That’s mainly because you will have to pay money at an extremely high rate of interest. In fact, you will be spending around three to ten times the amount that you have initially borrowed with the payday loan. This can lead you towards debt. Your debt will grow faster than you imagine. As a result, you will end up with a lot of financial difficulties in the long run.

  1. You can easily obtain payday loans

As mentioned earlier, it is extremely easy for you to obtain a payday loan. This can also be considered as one of the major drawbacks associated with it. That’s because you will be tempted to go ahead with it when you come across a financial requirement. You will even tend to obtain a payday loan at your lunch break. This is never a good habit. That’s because you never provide any time for you to think whether obtaining the loan is a good idea or not. You believe that it is the best solution out of all available options and go ahead with it blindly. With this, you will end up with a lot of negative consequences in the long run. When you identify those mistakes, you are too late.

  1. You will have to provide your bank account access

When you are obtaining a payday loan, you will be asked to provide your bank account access to the company that provides it. This can be considered as another negative effect linked with these loans. Your bank account contains a lot of sensitive information related to you. Hence, you should never go ahead and share the bank account details with another party. This is another major reason available for you to stay away from obtaining payday loans.

  1. You will end up with stress

Most of the people who obtain payday loans to cater to their emergency financial requirements end up with stress. That’s because the payday loans are linked with a higher rate of interest and you will come to a situation where you cannot settle them. In such a situation, you will end up with disappointment and frustration. This can bring in a lot of stress to your mind.

Due to all these reasons, you will need to think twice before you go ahead and obtain a payday loan. It is better to stay away from these loans whenever possible. Any help for financial problems contact gtacredit.com or call 416 650 1100

What to Consider Before Taking a Bank Loan For Your Business In Ontario

What to Consider Before Taking a Bank Loan For Your Business In Ontario

Capital is something really important for businesses to run their business smoothly. Many people switch from job to business to execute their ideas that even lead to great business opportunities. When they plan to start a business the first thing that stops you for a while is lack of funds or capital.

Business Loan

The loan is the best option to raise funds for your business. You can get loans from many financial institutions or banks. You may find the entire process of getting a loan a little bit complicated than earlier. Now banks have set up new rules for lending funds for businesses, especially small businesses. Thus you should be aware of detailed steps to get a business loan from any bank so that you can get your loan approved without any hassles. Let us look at the basic and essential steps that will help you apply for a loan from the bank and get it approved.

Create a perfect business plan

When you apply for a loan, the banks want you to present a powerful financial plan which works well for your business. It includes an introduction about you and what the business you want to start is about.  The business plan you present should be able to speak about your business goals and missions and also how the business will operate to achieve the goals and mission. A perfect and convincing business plan will help you convince the lender easily.

Explain the spending pattern for the borrowed finances

Banks are interested in knowing about how you are going to spend the loan amount borrowed from the bank. For example, if you are planning to buy equipment, you should seek an equipment loan. In another case, if you need funds to keep your business running prior to the debtors offer you money then make sure you apply for a suitable short-term loan. Hence it is better to explain what you are going to use the loan amount to help the bank assess whether the amount given will take care of all your business needs.

Mention the loan amount you actually need

Before applying for a loan makes sure you do all the calculations to find out the amount of money you need so that it is neither over nor underestimated. The reason is that if you seek less money than you need it can land you in financial problems in the near future. On the other hand, stating an overestimated amount can again put you in trouble as the bank will ask you whether you have made a perfect business plan after conducting thorough research. To put an end to all the doubts make sure you have a better business plan with a proper presentation and a budget.

Be determined about the credit score

Today, all banks verify whether a person who applies for the loan is eligible for the loan. When you apply for a loan make sure you check your credit scores and credit reports. It would be difficult to get a loan if your credit score is lower than expected. If your credit score is low you can try for a loan that is revenue-based. You can put in some efforts to increase your credit score before you apply for a loan from a bank.


Monitor your credit report

At times you could find some errors in the credit report and it happens when you are not attentive. It can pull down your credit score negatively. That is why you need to keep a check on your credit score by checking files of business credit and personal credit. In case you find any errors you can approach the credit reporting firm to get it corrected and increase the score after eliminating the errors. It is necessary to look into credit reports as a low credit score won’t fetch your loan from a bank.

Evaluate the available lending options

Once you check your credit report and find it to be fine, the next you need to do research and create a list of various banks that are feasible to provide the loan type you are looking for. Make sure you pick out the banks that provide loans at considerably low-interest rates and offer approval guidelines that are quite flexible.

Maintain accurate financial records

It is easy to get a loan from banks when you have correct and well-maintained financial statements. Banks check the balance sheets you have along with income statements and cash flow statements. Any help for financial problems contact gtacredit.com or call 416 650 1100

How Taxes works in consumer Proposal?

How Taxes works in consumer Proposal?

Do you want to get rid of debt? In that case, if you are getting a fixed income a consumer proposal can be the best option than getting into bankruptcy. The consumer proposal would help safeguard your assets and clear your debts to unsafe creditors.

The consumer proposal helps the interest increasing on the debt, halts collection calls and halts wage trimming. Under a consumer proposal, you can easily pay off a less and small part of the total debt you have with the help of a single monthly payment during a span of 5 years or lesser than that. You can pay for it anytime.

Let us understand what does consumer proposal mean?

It is an alternate option to bankruptcy created for those who are unable to pay off their debts to the unsecured creditors. You can create a new agreement with the help of a Licensed Insolvency Trustee with the creditors to pay off a lesser amount.

The monthly debts amount that you have to pay is completely based on the income you get and the amount that you can manage to pay as a debt payment.

The consumer proposal proves to be an ideal option for all those who are engaged in the process.

Type of debts that consumer proposal covers are

All the unsecured debts that you own are taken care of by the consumer proposal. It includes utility bills that are not paid, debt related to credit card, payday loans, and also the amount you owe to the Canada Revenue Agency. The consumer proposal is meant for all the debts below $250,000 (excluding mortgage). In case the debt amount is above $250,000 then you are entitled to the proposal – Division 1. You can visit gtacredit.com to get rid of debt with the help of a consumer proposal.

How do Taxes work in a consumer proposal?

Well, if you are planning to file your tax returns then it can be a cumbersome task if you are under debts or planning to file a consumer proposal. There are a lot of misunderstandings regarding the taxes you pay upon filing a consumer proposal and you may get in the trap of such misunderstandings as taxes are handled differently when it comes to consumer proposal rather than a bankruptcy.

The best source to get all your misunderstanding clear about your taxes is to seek help from a GTA CREDIT counselor or an Insolvency Trustee and you will get all the answers to your questions about your financial status and what exactly the consumer proposal has in store for you. The trustee helps you all through the process of a consumer proposal, for example, your assets, taxes, credit rating, etc.,

There are some basic things that you should be aware of how the taxes work while filing a consumer proposal.

In case of bankruptcy, you will need to cease the tax refund the same as you actually would pay a portion of your income as part of a legacy or any increment in your salary. On the other hand, the consumer proposal acts differently. You agree on certain payment terms with your creditors wherein you set a fixed amount to be paid on a monthly basis over a time span of 5 years. The agreement will not alter until and unless you choose to replace it with a new agreement that includes a quick rate for paying back the debt amount. The basic idea behind why a person should seek help via consumer proposal is to secure his/her increments in income in the near future.

Do you need to file taxes while seeking a consumer proposal?

It is recommended that you file the taxes while seeking a consumer proposal as if you miss filing taxes it could intervene in your agreement. In case of bankruptcy you need to file pre as well as a post-bankruptcy tax return.

When you opt for a consumer proposal or bankruptcy it is always better to seek credit counselling. Credit counseling helps you plan your credit and use it wisely and stay away from debt in the coming years.

You can get detailed information from the gtacredit.com or trustee as they help you create a consumer proposal and file the consumer proposal for you. They try to negotiate the amount with your unsecured creditors so they act as intermediaries between both you and the unsecured creditors.

They also help you learn how to utilize your credit and provide tailored counseling for dealing with your credit in the near future. They make sure that the agreement rules are followed by both the parties.

There are benefits linked to consumer proposal and they are

  • No need to file bankruptcy
  • Can protect your assets
  • The unsecured creditors will halt any collection actions that they take against you.
  • Any of the deductions on your bank accounts or wages will be cancelled.
  • You can pay even lesser amounts to the unsecured creditors as payback amount. This entirely depends on how much you can pay based on your income. All these payment terms are taken care of while filing a consumer proposal.
  • Once you file consumer proposals there will be no penalties or increased interest rates for you to pay.

The consumer proposal doesn’t include any disbursement of your assets like vehicles or house etc. in case you mortgaged your house then you need to pay the required amount to protect your house. The same applies to a car or any other secured loans. Remember, secured debts like car loans, home loans or mortgages are not taken care of in consumer proposals.

Upon completion of your consumer proposal, you are freed from all unsecured debt payments that are included in a consumer proposal. Basically the debt amount that you are supposed to pay in a consumer proposal is quite less as compared to the debt amount you owe.

A consumer proposal can help you with debts and you won’t find land in a situation where you find yourself under debts and it becomes impossible to overcome such situations. Any help for financial problems contact gtacredit.com or call 416 650 1100

How Handle Rising Interest Rates in Canada

How Handle Rising Interest Rates in Canada

Well, the borrowers can do much about the rising interest rates in Canada other than just saving money and getting prepared to deal with the next hike. When it comes to saving money, it is easy for those who are not paying any interest in other assets as part of loans, which again is not the same as everyone. In case you are at the borrower’s end, it is obvious that you get stress out with the fluctuating rate of interest. Do not worry as here are some ways that can help you face the rise in interest rates smoothly.

Carry out a stress-test on your portfolio

Here stress test basically means checking your portfolio to find out whether it can deal with the rise in the rate of interest. This can be checked people who are interested in investing in properties should focus on the future rather than paying more attention to the low-interest rates that they find currently in the market.

If you are on buying end then don’t look at the current numbers. Focus on the various rates that are available currently in the market. Explore the market to find out the different rates of interest.

You can also check if your portfolio can deal with the rise in interest rates to start paying the increased payments right from now. Try to set a budget that can pay the increased rates. You can either pay your mortgage in a lump sum that will be equivalent to the amount that would come out as a result of increased rates as it will help you be prepared and comfortable paying more money to the mortgage. Else you can reduce other bills and pay an increased amount as payment for other bills.  It will be like budgeting that particular payment.

You need to be committed to doing budgeting, paying higher amounts, etc.

Focus on the market conditions

You may lose your focus especially when your attention is divided among different investment properties. Make sure you keep an eye on what is happening in the market and check if the market is beneficial for you currently or for future investments.

You can just go through newsletters, news that you get from mortgage brokers. It will help you know about the market conditions. It is always better to change your plans as the market conditions change because that would be a smart move and you won’t end up losing money.

Prepare yourself for the rise in the rate of interests

Try to pay off as much debt amount you can pay before there is a rise in interest rates. In case the debt you have to pay off is less make sure you pay it back and get rid of the entire debts at once. This will not only reduce your financial burden but will also help you prevent the stress of paying higher loan amounts.

Here is how you can prepare yourself for the rising interest rates.

  • Reduce your expenses so that you can save money to pay back your debt.
  • Try to make payments for debts that have a higher rate of interest so that you will end up paying less money against interest.
  • Try to merge the debts having higher interest rates like debts related to credit cards with that of a loan that has a lower rate of interest but maintains the payments to be the same
  • Try not to get the highest mortgage/line of credit that others offer you.
  • Think about how borrowing extra money can restrict your potential to save money to meet your goals.
  • Find additional methods that can help you make more money to pay the debts.
  • Also, maintain some funds that can help you in case of an emergency that can come unexpectedly and add to your costs.
  • Make all payments on time to avoid paying extra money as penalty charges.
  • If required, you can go to the bank you have an account with to apply for a loan that is- debt consolidation plan. In case your loan gets approved then you will get a larger installment amount which can help you pay your small debts.
  • Plan a budget and reduce the living costs, household costs as much as possible and you think is an unnecessary expense.
  • If you are not paying your debt, then deposit that money in your account.

Talking about the rise in interest rates in Canada it becomes a little difficult to deal with the rise without pre-planning. You should plan your financial goals for the future before time runs out. It is always recommended that you start paying some extra money against interest every month to finish paying your debts quickly. You can make it a practice and see how things work and you will be debt-free within less time span than expected. You should think about your financial situation before you apply for any credit card. You can easily manage things with proper planning and handling money the right way.

You can also seek help from financial experts to know how rising interest rates can influence your finances before you take any decision that involves money. The financial experts will help you calculate the interest rates based on your loan amount and income so that you can decide whether to go investments or not. The idea is to get a clear idea of how rising interest rates can change your finances. It is better to plan your future financial goals as this rise in interest rates can affect your goals to a great extent. So, prepare yourself for the rising increased rates so that you do not land up facing a financial crisis.

Do not ignore the fact that the rising interest rates can affect your overall lifestyle and you need to be prepared for it in advance to help maintain your current lifestyle. Just focus on market conditions and speak to your financial expert to give you proper guidance on how to manage your finances. Any help for financial problems contact gtacredit.com or call 416 650 1100

My House Budget,How do I Make Sure I Don’t Run Out of Money before the End of the Month?

My House Budget,How do I Make Sure I Don’t Run Out of Money before the End of the Month?

It is your payday and it feels so great when you get money isn’t? You can see money in your account to again buy things you need or dine out in a restaurant etc. if you are someone who loves going out and spending money after every payday then you may fall in short of money even for the essentials at the end of the month.

If you fall short of money because you do not have any savings then even your bills will be due. Now, here is how you can get rid of falling in short of money at the end of the month with simple tips.

Keep a check on your expenses

It is essential to manage your money properly and keep track of where the money is going. Just take a notepad and a pen to write down your expenses and remember all of them which also includes the hidden expenses that occur throughout the year. They can be travel expenses, gift expenses on holidays, subscriptions, and other medical expenses.

You can divide the list of expenses over twelve months which will help you find out the actual cost of your living standard. Now, you can categorize these expenses to know which ones are essential and which are not. The list will help you know the two categories that are essentials and nonessentials. This will also help you reduce your expenses on nonessentials or completely eliminate them like salon trips, coffee shop visits that you may be indulged infrequently.

Remove the unnecessary expenses

It may be the most difficult thing to do while planning a budget, but it works, and is necessary to stop spending money on unnecessary things. Once you check your inventory and list out the unnecessary expenses try to eliminate them as they cost a lot in the long run.

If you are not very keen on eliminating them completely then look for economical options like coupons or discounts, which can be used while dining out or for any entertainment activities.

Keep a track of your money

After sorting out the expenses and removing the unnecessary items, you can keep a track of the money for which you can check the bank statements, receipts, etc to check where the money is being spent the most. This will help you set a budget and follow the same. You can also use online tools that help you monitor your budget.

Some people follow the traditional pattern of keeping track of budget expenses that is by writing on a paper. This works too as long as you stick to your budget goals.

Liability is important

Taking responsibility is important. You can also let your friends remind you of your goals and keep a check on how much you spend.  You can also go with a cash envelop old method. You can keep an envelope for each category that belongs to spending. You can keep some cash as per your budge in the envelope. When you end up spending the money placed in the envelope it means you have to stop spending now.

Make sure you reduce the spending every month which will automatically save money and you won’t run out of money before the end of the month.

Money for Emergency

When we discuss money to be saved for emergency it means you will have some funds for emergencies. It is the best practice and an easy way to stick to the budget and do not fall short of money before the month gets over. Make sure you save some money for emergencies but do not try to spend the money from this fun just because you end up spending more on other things like buying shoes or groceries etc. The money saved for emergencies means for emergency situations only like an unexpected visit to the hospital, car repair, etc. The emergency funds help you cover the unexpected costs without affecting your budget. In case you use your emergency funds to handle emergencies, then make sure you fill in the money taken back to the emergency fund so that you do not face problems in the future.

Do not worry or blame your income which may be less as a properly planned budget can help you deal with low income as well. A budget can help you find out if you are earning enough to pay for your basic necessities like food, bills, etc. In case you feel the income is really less do not waste time thinking about it, just upgrade or shift to a better job. Try to learn new things that will help you earn enough money to bear all your expenses. Your proactive approach can help you fulfill your goals.

Some people earn more still they are short of money before the month ends, this is because they are spending more money on unnecessary things like eating out often, buying things that you do not need or planning frequent trips that cost a lot. All these things lead to problems at the end of the month. Make sure you pay your bills on time so that you don’t have to pay extra for late payment.

Do not keep any bills pending. Once you pay your bills you will be able to evaluate how you can spend money on necessary things and save money in the end. If you think you want to buy something, start saving money to buy the product so that you don’t have to disturb your monthly paycheck to buy the product. Determine whether you need a particular thing before you place the order. It is always necessary to determine whether it is a want or a need before you make a purchase.

Make sure that you remain true to yourself and money saved is money earned so do not waste your hard-earned money to buy unnecessary things. Any help for financial problems contact gtacredit.com or call 416 650 1100

Budgeting On a Fluctuating Income

Budgeting On a Fluctuating Income

Some people do not get a steady income like salespeople, freelancers, or people who are self-employed. They actually face a lot of problems due to fluctuating incomes. It is a nightmare to plan a budget when you have no idea about how much you are going to earn each month. This is a serious problem for those who work on a commission basis or are self-employed.

The income they get depends entirely on their monthly sales or projects they get. Well, if you are among those who earn a fluctuating income and find it really difficult to plan a budget, then read on to find out how you can still plan a budget.

Identify the minimum amount you earn

Before you start creating a budget with fluctuating income, you need to identify the minimum amount you earn. Also, determine your minimum expenses on a monthly basis. For all those who earn a fluctuating income, plan their budget keeping in mind their expenses related to basic necessities like house mortgage or rent, groceries, utility bills, groceries, childcare, transportation, etc.

While following any budget plan it is really important to find out how much you need to make to bear your bills. But, in this case, this step won’t work as the income is not steady. To create a budget for fluctuating incomes just write down the list of essential things and monthly expenses on a paper.

Out of the expenses you have listed there are some fixed expenses like rent, mortgage, etc. Now, try to figure out the expenses that change. They can be grocery bills, traveling expenses, utility gas, etc. Also, write down debt repayments, savings, investment, etc. You may think that these bills aren’t crucial to survive still they are quite important.

Calculate monthly expenses that are optional

 After you filter out the essentials then try to list all other things. While writing down the optional expenses consider the bill for cable television or any other payments you make for entertainment, hobbies, cash spent on sports, or money spent to dine out.

If you are unable to find out the approx spending on non-essentials then pull out some credit card or bank statements to check. Also, try to find out something that had overburdened your pocket in the last few months.

Create emergency fund

 In case you hold some savings already then nothing like it. It is always better to have savings of money for 3-6 months. It helps especially when you have a fluctuating income.

It is always better to create an emergency fund to fight days when you don’t earn a sufficient amount or say nothing. Savings can bridge the difficulties in crucial times.

Staying on income from last month

 Once you created a budget for your fluctuating income and included your unnecessary expenses then you will come to know the amount of money you need for the month without disturbing your savings. You can deposit the money you get the previous month to your savings account.

You can start putting whatever you earn in short term or long term savings whichever suits you. This helps you stay on income from last month.

 Credit a salary for yourself

It is again a step ahead of how you were advised to put your money in a regular savings account in the very first month. Here you will be paying salary to yourself. You may be wondering how is that possible isn’t it? Think about times when you were working hard and earning a fluctuating income but here you will award yourself with a salary.

You can follow the budget for fluctuating incomes and eliminate optional spending which will save money for you. Now you will not end up spending more than earnings.

Pay bills depending upon the income you earned last month

 The money you need for your fluctuating bills, as well as nonessentials, is there in checking account. The right budget that comprises of your expenses and bills for the month is what you have now.

Now you will start paying your bills as per the budget you created that consists of debt payments or paying savings.   If you need an individual account for long term savings then go for it. You can also put some cash back to the regular savings accounts every month and see how money grows.

Mark all your bids as paid and put a zero at the end

As not all bills will be due at the start of the month, you need a proper system to keep track of your spending as the month passes.

Make sure you pay every bill right at the beginning of the month. Pay your mortgage or other bills in the second week of the month. If you are planning to spend on entertainment then make sure you do not spend more. Keep your bills marked as paid

It is not easy to plan a budget with a fluctuating income, but with a proper budget, you can accomplish the task. While you create a budget for fluctuating budgets make sure you find ways that can help you get a steady income. Also, if you succeed to earn more in between, try to save money for the days when you either earn less or absolutely nothing. Do not rely on monthly income; try to save for 3-6 months to have a stable amount in your bank that can back you for at least a month during no or less work.

If you can find income coming from more than one source, it will help you earn a stable income or constant money incoming to your account. Try not to spend on entertainment or things that are not essential. You have to go slow and figure out things that need money on a priority basis. You can create a budget plan for fluctuating income and follow it too. With little dedication and smart planning, you can achieve your goals with irregular income too. It may sound a bit difficult, but it works and with the time you will get used to it. Any help for financial problems contact gtacredit.com or call 416 650 1100