by admin | Uncategorized
Going bankrupt is more than just a burden on your shoulders. It takes away your mental and physical health and the stress that it brings along, makes life miserable. At GTA Credit Solutions Services, we don’t like seeing you under those conditions. Therefore, we have compiled a set of ways you can follow in order to avoid going bankrupt.
1. Get in touch with your creditor
Sometimes in life, there are unforeseeable situations that will hinder your credit payments. While many people will just continue with the late payments, it is better for you to talk to your creditor about it, the very moment you anticipate it. Taking your creditor into confidence before a possible late payment may save you some penalty charges.
2. Need is one thing, want is another
If you have a cell-phone, a car, or a house that caters to your essential needs, then there is no need for you to upgrade either of these things unless you have sufficient savings to do so. Don’t confuse your needs with your wants. This trick will surely save you a lot more money than you think.
3. Don’t pay debts with debts
The worst thing you can do is pay off one costly debt by diving into another. This will only keep mounting your loans until it eventually makes you realize that new loans aren’t available anymore. Usually, it is too late by the time people comprehend this fact and they are then left with no option, other than going bankrupt.
4. Use cash, not credit
Using cash is one of the best ways to limit your expenses and avoid your debt from piling up. When you use cash, you know how much you have and how much you can use. If you cross your limits, this is a sign that you don’t have to spend on unnecessary things anymore.
5. Be wiser
Know cheap alternatives for everything! You don’t have to necessarily spend your money on expensive stuff. Try cheaper alternatives and you will be astonished to see how much money you can save by the end of the month.
6. Sync existing payments
In case you have more than one loan to pay off, ask your creditors to sync the date of the payments. This will help you analyze how much money you need and in how much time. In addition to that, having a single date of payment for all debts will allow you to avoid any late penalty charges as you won’t get confused between several different payoff dates.
7. Reorganize your mortgage
One way of getting rid of some mounting debt is to reorganize the payments on your house and use the extra cash to pay off another debt. This is a good strategy if done once or twice at max.
There are several ways with which you can save yourself from going bankrupt. If it is already too late for you, don’t worry! GTA Credit Solutions Services(Gta Credit) is there to help you out. We are a team of certified counselors who make sure that you get rid of your mounting debt and start over fresh. Moreover, we also arrange counseling sessions with you so that once you start fresh, and don’t get tangled in the same situation again.
by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Uncategorized
When you go to a creditor in order to get a loan, the first thing they want to know is your credit rating. A credit score is something that summarizes your credit history including your present financial condition. This is basic credit scoring, but there are certain areas of credit ratings that most people are unaware of. Following are some of them:
- Something as simple as paying your bills on time is something that could actually enhance your credit score.
- It is not only your financial history, but also a bad public record that can lower your score by a good margin.
- A bad credit score can even cause hindrance in getting the desired job. Many employers judge professionalism on the basis of how you manage your life – most importantly, your finances!
- If you have a good credit limit, you don’t have to use all of it. It is recommended to keep within thirty percent of your credit limit to keep your credit score in a good condition.
- Clearing your mortgage does not help in improving your credit score. Instead, when you’re not paying mortgage (even due to the fact that you have cleared the full payment on it), your credit points get reduced.
- Those old accounts that you no longer use might still be of use. The main reason for this is because your new creditors will feel safer when they get to see your long, healthy credit history. Unlike common belief, shorter (even though clean) credit history is not as good as a longer (and fair) one.
- Opting for a secured credit card is a better option for starters as compared to choosing an unsecured one, right away. In most cases, taking an unsecured credit card is not an option for people having no credit history.
- Don’t focus all your credit on a single loan instrument. Try to keep a mixture of different products like a credit card, a car loan, and a home mortgage etc. Focusing all your credit at one instrument is not considered very healthy.
- Looking to rent a place? Even landlords take a look over your credit ratings before renting the place, just to make sure that you don’t default on the rent payments.
- A credit score above 650 is considered a good score.
- In Canada, Equifax and TransUnion are the only agencies for credit reporting.
- Even staying at a single place for a longer period of time can improve your credit ratings.
- Try sticking to one or two credit accounts at most. This will help you manage your finances in a better way as opposed to having a lot of accounts. Furthermore, make sure your accounts have very little to no balance. This will help you in maintaining or even improving your credit score.
There are a lot of things that affect your credit scores. Therefore, to maintain a good one, you should be aware of most, if not all, of the factors that help in building a good credit rating. Damaged your credit rating already? Contact GTA Credit Solutions Services Ltd. (GTA CREDIT) to help you in getting your credit scores back on track.
by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Uncategorized
A number of Canadians are finding themselves under insurmountable debts. Whether it is because of some medical needs, student loans, mortgage loans, credit card loans or any other loans – when these debts get overwhelming and people start spending more than they can pay back, they are left with two options. These alternatives are consumer proposal and bankruptcy. Both of the options can help you get out of the debt; however, both have different ways to go about doing that. Below, we will discuss which option out of these two is the best for which type of candidate.
Candidate for Consumer Proposal
Consumer proposals are best for those individuals who want to keep their assets protected, and have a stable flow of income. The reason is that the creditors in this debt management are more interested in how much the individual earns, as that is the asset for them. They do not want your liquidated assets. Being insolvent and having a stable wage makes you an ideal applicant for consumer proposal. In addition, you will also be entitled to pay all the taxes.
Once you settle for consumer proposal, you have power over your finances and assets. The decision regarding what to do with the vehicle or home is entirely yours rather than of any bank or trustee. Additionally, the reports regarding bankruptcy will be sent for only 3 years.
Moreover, there are certain limitations of consumer proposal itself that are necessary conditions to be eligible for it. Not having the debt of more than $250,000 other than mortgage, and inability to payback the entire debt are some of the conditions, and even meeting the conditions do not necessarily provide you with the creditor’s acceptance. You will receive a certificate whenever your proposal is approved.
Candidate for Bankruptcy
On the other hand, people who are right candidates to file for the bankruptcy are those who want to free their unsecured debts. To be qualified to file for personal bankruptcy in Canada, an individual has to be under the debt of more than $1,000. This will provide the individual with financial relief and guard them from their creditors.
To settle the debt, the individual needs to be aware that they have to give up few of their assets. Moreover, the bankruptcy will remain for 6 years on your credit rating if it is your first time declaring bankruptcy. Those who get automatic discharge will find bankruptcy on their credit rating for less than seven years. Lastly, you are not obligated to pay the taxes, as you cannot afford to pay.
You can take help of counselors who can guide and advise you on your debt problems, and ways to deal with it. A professional insight will surely be supportive to help you move forward and take responsibility of your actions, and give you a financially fresh start.
by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Uncategorized
Consumer Proposal is the answer to serious debt problems in Canada. It is a legal agreement between the lender and the creditor that offers the creditor a chance to payback an amount that is lesser than their debt. Insolvent individuals, who cannot pay off all their debt on time, and do not own any such assets, can qualify for consumer proposal.
There are a lot of advantages of considering consumer proposals over bankruptcy. Some of them are discussed below.
1. Reduced Payback Debts
When an individual, who is under a huge debt, files for consumer proposal, their debt is reduced. This means that after filing for consumer proposal, they only have to pay up to 30% of their debt amount. This encompasses collection debt, credit card debt, income tax debt, overdrafts, and line of credits.
2. Protecting the Assets
Unlike bankruptcy where your assets can be taken away from you, consumer proposal protects them once it gets accepted. These comprise of your vehicle, cottage, house, RESPs, and RRSPs. While you are managing your debt, you need to protect your assets too, because these are the only things you are left with after your retirement. Nevertheless, you just need to keep making payments till the duration that has been accepted by your creditor.
3. Affordable
Not only is the process of filing for consumer proposal less expensive, but also the amount you are supposed to pay to the creditor is decided on the basis of your financial capability. Additionally, it takes around 60 months to pay off the proposal therefore; you can save the debt repayment amount by saving from your monthly expenses and become debt free once the period of 60 months are over. By paying at least a particular amount of your debt, you will feel an ownership and responsibility of doing something about the problem yourself. Moreover, this option is best for people who cannot pay the entire amount, but can pay back some of their debts.
4. No Legal Actions against You
Once the application for the consumer proposal is submitted, you will be protected against any legal actions taken by the creditors, such as garnishment of the wages and harassing phone calls. You will not find these benefits in other debt reduction alternatives. Other debt managements take place through the negotiation between the lender and creditor.
5. Simpler Process
The process to carry out consumer proposal is quite easy and uncomplicated. You can take the help of a counselor to create a proposal that the creditors will agree on, and is also in accordance with your interest and budget. Filing of the proposal is the next step, and lastly, after you have gotten a green light from the creditor, you will make payments on a monthly basis.
If bankruptcy is your least favorite option, then apply for consumer proposal. You can also take help of counselors that are experienced in the field to help you decide on which options you should settle for.
by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Uncategorized
A number of people find themselves in a position where they need to get a loan even after they have gone through the consumer proposal. The best part is that you have made it through the consumer proposal, and now you have better control over your finances. Do not feel bad that you had to go through this because these processes were made for us to financially reestablish ourselves.
Now, the question is, can you qualify for mortgage loan in Canada after you have completed your consumer proposal?
Time Duration
During the consumer proposal, the bank will not lend you any money as you are already under debt. The individual has to wait for up to two years after the discharge to be regarded as a candidate for loan. This is because the bank has to make decisions in their interest and many times, people stop paying the consumer proposal amount and declare bankruptcy in the middle of the process.
Bank Requirements
The bank will decide if you are eligible for mortgage after consumer proposal or not. This judgment is made on the following criteria.
a. Low Debt Income Ratio
Your debt income needs to be low, if you have not developed a balance on credit cards after the proposal is complete. You will be at risk because you will be in debt of more money than you are earning.
b. Stable Job
Second thing that the bank will take into consideration is how stable your job is. Your income and the length of your employment will also be verified. If you do not have a stable job, or a steady source of income, then you will have hard time convincing the lenders to provide you with the money.
c. Credit Score
Lastly, your credit score will be examined, which has the power to either grant you with mortgage or not. If you are applying for mortgage just after completing your consumer proposal, your credit score will be low. Therefore, you need to acquire strategies to boost your credit score and credit rating.
Moreover, after you have completed the consumer proposal, you can wait for some additional time and then apply for the mortgage. During that time, you can work on enhancing the credit rating because you will only get the bank’s approval if your credit score is good enough. This is the most important criteria out of the three. Individuals who are not able to meet this criterion will not get the mortgage loan even if they meet the other two conditions.
People can also carry out a credit check on themselves before they make an application on their mortgage approval. The credit bureau should include the right date of the completion of consumer proposal, and the creditor of the consumer proposal must be shown inactive. This way, you will correct the blunders before filing the mortgage application.
You can also take the help of a counselor to guide you regarding mortgage and your eligibility. Even if you do not qualify now, you will be provided with directions that will facilitate you in the future.
by admin | Bankruptcy, Uncategorized
The lack of awareness among people regarding bankruptcy and its process creates greater problems for them in the future. It is therefore essential that you know what you are getting yourself into before filing for it. There are also a number of myths attached to bankruptcy that most of us unconsciously believe. Below mentioned are some of the myths you need to steer clear of.
Bankruptcy Incorporates All the Debts
Bankruptcy does not clear all your debts. However, debts that are unsecured, such as: utility bills, credit card debt, medical bills, and any other loans can be cleared through bankruptcy. Nevertheless, secured debts that have a particular property, such as a house or car loan cannot be cleared by filing for bankruptcy. Moreover, if you have stopped studying for less than 7 years, your student loan is excluded from bankruptcy.
Financial Irresponsibility Causes Bankruptcy
It is natural to think that people filing for bankruptcy were not responsible enough to manage their finances. However, this is far from the truth. Serious medical conditions, divorce, and losing the job can get anyone under debt. This is because if the person stayed unemployed for too long, at one point, the individual will run out of money. Similarly, the legal fees that go in handling the divorce and high medical bills can take a toll on the income of even the highly paid person.
Bankruptcy Can Be Filed By Anyone
Unlike popular believe, not all individuals are capable enough to file for the bankruptcy. There are fees and other costs that even this process demands. Your income and assets will be examined, and on that basis, you can decide whether the process is expensive for you or not. You do not want to solve your financial problems by getting into one.
You Lose Everything
Going bankrupt is not synonymous to losing all your possessions. There are limits set by the provinces on the basis of which you can keep certain household furniture, clothing, and health and medical apparatuses under your name. Additionally, you can also keep your vehicle, equipment that help you earn your living, and home, as long as there is no high equity on them, and they are modestly priced. In Canada, you do not have to face mortgage foreclosure either, if you go bankrupt. So you need to know these details to ensure that bankruptcy will be a safer option for you.
Your Credit is Ruined Forever
To be honest, if you are left to consider the option of bankruptcy, then your credit score is already very low. When you file for bankruptcy, you will see an increase in your credit score if it was way lower. However, the credit report may suffer from the blow, but you will be getting the credit card offers in your mail in no time. You will be able to get a secured credit card, which will assist in improving your credit score if you make the payment on time and after about a year, you will be eligible for the regular credit card as well.
Married People Can’t File for Bankruptcy Alone
Do not worry about your spouse if you want to file for bankruptcy while you are married. There is an option to apply for bankruptcy alone. Although information regarding the income of your spouse will be asked in some areas, just to make certain they are not multi-millionaires, they will not be involved in the matter because of you.
So, there you have it, six myths you need to steer clear of before you opt for the bankruptcy alternative.
