Understanding 4 Debt Consolidation Services in Canada

Are you suffering from Debt problems? If you don’t find a way to get a handle on your debt soon, it can get out of control really quickly. Before overwhelming consumer debt starts to affect your credit profile, find out what you can do to minimize your debts, consolidate your payments and get out of debt sooner. Not sure which options are available to you or how they really work? Keep reading to find out about the top debt consolidation services in Canada that can help you get out of debt for good.

Understanding Debt

Falling into debt isn’t always a matter of improper spending. Sometimes, it can be due to unexpected emergencies or economic crises – like the current pandemic we are living through right now. You can plan your future out well and still be thrown for a loop if you lose your job or if you or a loved one becomes critically ill.

What’s important to understand when you are faced with debt, is how you got there and how quickly you can get out of it. Was your contingency fund not enough? Did you not have insurance? Or was it completely out of your control? If you can make some changes to prevent falling into debt in the future, now is the time to learn those lessons.

The next important thing is to figure out how you will realistically pay your debt back. If you can’t come up with a plan that works, all you will do is incur more debt. You also need to determine whether or not your debt should be consolidated. For example, if you have unsurmountable credit card debt, paying it off month-to-month while still paying your other bills and living your life is probably not going to work for you.

What is Debt Consolidation?

Debt consolidation services are services that allow you to lump all your debts together so you can make one single, manageable payment at a better interest rate. You won’t have to pay multiple minimums and you won’t be incurring more debt due to unreasonable interest rates.

The goal of debt consolidation is to make your repayment easier and simpler. Plus, paying your consolidated loan can help you rebuild your credit. Making your payments on time will help rebuild your credit score. At BHM Financial, our experts will work with you to help you create a debt repayment that works for you so you can actually pay it back and be on your way to financial freedom.

What if I Have Bad Credit?

Not to worry. At BHM Financial, we offer bad credit loans to help Canadians regain control of their financial future regardless of their credit score. In fact, we will never base our decision to loan you money on your credit score. We offer same day bad credit loans to help you get the cash you need to pay down your debts. Because we don’t work with third party lenders, we can even approve your request online instantly.

If debt problems have led you to bad credit, we can still help However, having bad credit can have other negative effects on you. It can prevent you from passing credit checks to get a new job or promotion, or even a new apartment or home.

Debt Consolidation Services in Canada

To better understand your debt solutions, here is the breakdown of the most common debt consolidation services in Canada. Each one of these options can work for different situations. If you still aren’t sure which consolidation method is best for you after reading this, call us today to meet with one of your debt management experts. They can help you navigate through the options and find the best solution for your life.

Bad Credit Personal Loan for Debt Consolidation

If you have debt, especially on your credit cards, you may want to consider a personal loan. Traditional banking institutions are not likely to give you a loan if you have bad credit – which is often the collateral damage of debt. However, at BHM, we are a private lending firm and we can provide you with a bad credit loan. That means even if your credit score is bad, we can give you a loan anyway.

A personal loan can be used to pay off your debts and consolidate them into one single payment. We can likely reduce your minimum payment and work with you to create a repayment plan that works with your lifestyle. In paying back your loan on time, you can actually help rebuild your credit rating, which you still need for other facets of your life.

Home Equity or Second Mortgage Consolidation Loan

If you own your own home or have enough equity in it to qualify for a second mortgage, we can offer you this type of debt consolidation service at BHM Financial. This allows you to leverage the asset you have to pay down your debts and keep them from growing. Plus, a home equity loan can convert your unsecured debts into secured debts, which will not impact your credit rating.

If you have bad credit, a traditional banking institution will not likely provide you with this type of loan. BHM Financial understand the importance of getting out of debt, especially if your credit rating is suffering.

Debt Settlement for Debt Consolidation

Another debt consolidation service in Canada that consumers can turn to is debt settlement. Essentially, this is when you or a third party request a reduction in your debt. This way, you will reduce both your debt and your interest to a reasonable amount so you can actually pay it back. However, it is very difficult to get creditors like banks or credit card companies to agree to such terms.

Some creditors, like utility companies, may be more likely to work with you. Even collections agencies may be open to it so they can at least recover some of the funds. But you must be aware that aside from being difficult to pull off, it seriously impacts your credit. Essentially, you are admitting you cannot afford to pay this money back and are probably very close to insolvency.

Vehicle Debt Consolidation Loan

If you own a vehicle, you can apply for a bed credit debt consolidation loan, using your vehicle as collateral. A lien will be placed on your vehicle – which must be paid and less than 8 years old – until your debt is cleared. This is a way to turn your depreciating asset into financial leverage so you can pay off your debts.

Why Should I Consider a Debt Consolidation Service?

If you have debt in more than one place, especially if that debt is on your credit cards, consolidating is the best way to save money. You’ll lower your minimum payment and reduce your interest costs so you can pay down your debts sooner. By paying. Minimum on several credit cards, you are only making your debt problems worse. Credit cards companies will keep you in the cycle of debt for years.

Instead, a debt consolidation service can help you to finally regain control over your debt and your financial future. If you’re not sure which consolidation method is right for you, contact us today. The experts at BHM Financial can help you determine which debt consolidation services are best for you and explain to you how each option works.

When Should I Consider Debt Consolidation Services?

You should seriously consider debt consolidation services if your debts are becoming unmanageable. If you owe money on several credit cards and to other creditors, as well, owing money to everyone can make it difficult for you to keep up and even impossible for you to pay back. If you are frequently missing payments or find yourself unable to pay the monthly minimums to keep your credit in good standing, it’s time to consider debt consolidation services.

Another sign you need debt consolidation services to help you out is if you find yourself with very little left after paying your debts to actually live. You still need to put food on the table, pay for housing and care for your loved ones. Paying off huge debts can make it difficult to achieve this. By consolidating your debts, you will likely be able to significantly reduce your minimum payment and work out a plan that still allows you to cover essential costs.

What Happens if I Don’t Repay My Debts?

If you don’t repay your debts, you credit will reflect it. That can prevent you from securing safe housing, getting a new job or promotion, or securing loans for a mortgage from traditional banking institutions. Your credit cards will be suspended and you will find yourself without the means to get by. Not repaying debt is not a viable option. Instead, it is advisable to seek proper financial counselling from a debt consolidation expert to find out how you can repay your debt in the simplest way possible.

Should I Declare Bankruptcy Instead of Using Debt Consolidation Services?

Bankruptcy should always be seen as the ultimate last resort. If your debts are absolutely impossible for you to repay, you may have to consider filing for bankruptcy. However, this option is not without consequence. Bankruptcy will make it impossible for you to secure a credit card for a minimum of seven years. Even after bankruptcy has been removed from your credit report, it can still affect you when searching for employment or a loan from a bank.

If debt consolidation services can help you manage your debt and repay it realistically, you should always choose debt consolidation instead of bankruptcy. Debt consolidation can help preserve your credit and get out of debt. It can also help you by making your payments manageable without destroying your credit long-term. If a debt consolidation expert suggest you can overcome your debt with proper debt management, you should seriously consider it before opting for bankruptcy.

What are the Benefits of Debt Consolidation Services?

Debt consolidation services can help you to make sure your debts manageable. They can reduce your overall interest payments to actually save you money. Debt consolidation services can also help you improve your credit score by allowing you to meet your minimum payments, and they can reduce the minimums you owe every month.

In addition, debt consolidation services can also give you access to professionals who can help you manage your finances. An expert at BHM Financial can help you create a budget that works for you and can help you plan better for your financial future. Meeting with a debt consolidation expert can mean the difference between suffering through debt forever, and getting a handle on your debt and managing your financial future even better.

Will Debt Consolidation Services Hurt My Credit Score?

In the short term, some debt consolidation services may have a small impact on your credit rating. I you choose to go with a Home Equity Loan, there will be no impact as this will turn your debt into a secured debt, which can be beneficial to your credit. A bad credit personal loan may affect your credit at first but long-term, it can benefit your credit.

If you are missing your payments because they are unmanageable, you are most definitely hurting your credit. If you consolidated your debts into a personal loan with manageable payments, you will find yourself making your payments and improving your credit rating. The long-term effect of consolidating your credit will outweigh the short-term impact on your credit score. Debt consolidation services will help you to get control of your debt and start slowly rebuilding your credit rating with each passing month.

What is the Difference Between Debt Consolidation and Debt Settlement?

Debt consolidation refers to putting all of your debts together. Essentially, the lender will give you the money to pay off all of your creditors and then you will only be responsible for paying back the lender. The lender can lower your overall interest payments and make your repayment amount feasible for your lifestyle. Debt consolidation can also help to improve you credit as you pay down your debt. The goal with debt consolidation is to completely pay off your debts and make the move towards financial freedom.

A debt settlement is not the same thing. A debt settlement is when you or a trustee on your behalf gets the creditors you owe money to in order to reduce some of your debt in order for you to pay it back. The difficulty with this process is that it will dramatically impact your credit and it is traditionally very difficult to get lenders to reduce debt amounts. Credit card companies are known for being particularly unhelpful in this area.

You will also most likely need a trustee to help you get a debt management plan accepted and there are costs associated with it. Debt consolidation is usually the better option for most consumers.

How Do I Get Started?

Once you have informed yourself a little bit on each of the debt consolidation services available in Canada, you should start by meeting with a consolidation expert to discuss your individual situation and the possible choices you have. A debt consolidation expert can further explain to you how the process of debt consolidation works and can answer your financial questions.

Once you have agreed on the terms of the loan, our BHM Financial experts will sit with you to create a repayment plan and a budget to help you manage your loan payments and your finances the best way possible. This advice and strategic planning can help you get out of debt and stay out of it long-term.

The next step will be to apply for the loan. Because BHM Financial doesn’t work with any third parties and lends money to customers directly, we are able to approve loan requests as quickly as the same business day. We can then get you the funds to repay your debt.

Why Choose BHM Financial?

Our experts are very knowledgeable and can help you determine what solutions are ideal for your current debt situation. BHM understands that debt can happen to anyone and getting out of debt is crucial to developing your financial future. That’s why we offer bad credit loans – to help our Canadian clients get back on their feet faster.

Plus, our experts will work together with you to help you find a repayment plan that works for you and can actually help you manage your payments and live your life. Unrealistic payments will only set you up for failure. At BHM Financial, we want you to get out of debt and improve your credit rating by not missing any payments. That’s why we work to individualize repayment plans.

If you’re struggling with debt, don’t wait any longer. The more time that passes with debt, the harder it can be to overcome it and the more it affects your credit. Instead, contact BHM Financial today to find the solution to your debt problems so you can get on your way to living a financially secure and debt-free life sooner!

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