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Free Debt Consolidation
No contact details required to find out if you qualify
The need for debt financing in Canada has increased as many businesses find ways to bounce back and recover from the COVID-19 pandemic.
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According to a study entitled “Trends in Canadian business debt financing: Before and during COVID-19” published by Statistics Canada, private non-financial corporations’ debt doubled from the peak of the financial crisis in 2008 to early 2020. “At the onset of the pandemic in March 2020, businesses added a record $52.1 billion in credit debt to their balance sheets,” the report said.
However, with financial resources such as debt and equity financing becoming available and businesses learning to adapt to the new normal, outstanding loan balances with banks decreased for eight consecutive months.
Whether you want to purchase inventory, hire more employees, or buy or upgrade equipment that would streamline your services, debt finance is a solution.
Companies that resort to debt financing raise money for working capital to either recover from their loss or expand their ventures. They sell debt instruments to individuals and/or institutional investors such as banks. As a return, the lender would get the principal, and interest on the debt would also be repaid.
Forms of debt finance include credit cards, overdrafts, loans, and lines of credit.
Meanwhile, equity financing is the opposite. Instead of borrowing capital, a business sells shares of its company. There is no need to repay the debt, but those who bought shares would profit from the company’s revenues.
Since you did not sell any share of your business, you still have full ownership. Therefore, you do not need to worry about decisions being made behind your back. You still have the final say. Many huge companies have shut down after selling their shares because of the differences among stockholders. A great example of this is what happened to Apple founder Steve Jobs who was forced out of the company he started due to shareholders’ decisions.
Another advantage of debt financing is it has a deadline. Once you repay the money you owe, you are already free of liabilities. However, with equity financing, you would have to work with shareholders as long as they want. This could affect the future endeavors of your business.
Since debt financing is a business expense, the principal and interest payments on your debt could be reduced from your business income taxes. However, you still need to consult with a tax professional or debt repayment planner concerning the effects of debt on your taxes.
Although you have to pay your debt in fixed amounts and dates, you get to keep all of your company’s revenues. So you have full authority on how and where you would want to spend your profit. This way, you can repay your debts while saving for further expansion or upgrade.
It also has lower interest rates. As an example, you can get a 7 percent interest rate instead of 10 percent for a business loan. So it is a win-win situation as you can get the capital you need to recover from the COVID-19 pandemic while also decreasing your tax rate.
Debt financing is only one of the ways to recover from the economic impact of the COVID-19 pandemic. Like other financial methods, it also has disadvantages, so your decision would still depend on your business vision. There is no one-size-fits-all financial solution.
To know more what you can benefit from our Ontario Debt Relief Program, simply try our Debt Consolidation Calculator below and one of our debt specialists will get in touch with you and provide you the best debt relief option that fits your situation.
No contact details required to find out if you qualify
We will help you reduce as much as 75% of your debts and consolidate it into a single affordable monthly payment. Your creditors will stop harassing you and all interest will freeze if you get into our Ontario Government Debt Relief Program.
Many Ontarians are already benefiting from our Debt Relief Program, YOU should too!
Find out how much you can write off portion of your debts by getting your Free Savings Estimate below. A debt specialist from National Debt Relief Services in Ontario will discuss all options and provide you tailor-fitted Debt Relief Program.
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No contact details required to find out if you qualify
A Debt Consolidation is a negotiated debt settlement offer made between you and your creditors with the help of a Debt Relief Agency in Ontario. Some key benefits of Debt Consolidation are interest-free program, no upfront fee required, combined monthly payment into one affordable amount, no lawsuits, and many more.
Yes, your assets are safe from creditors. A licensed debt relief agency in Ontario will help you come up with an offer to your creditors that will make sure your assets will be out of the paper.
No, in fact, this is one of the great advantages of a Debt Consolidation Program. All wage garnishment will stop from the day you filed the proposal.
The effect on your credit score is not going to be severe. Your credit score will most probably go to R7 Rating and will remain in your credit report for another 3 years after you completed the program. This means that it will not be permanent and you will still be able to rebuild your credit score.
This varies depending on the proposal you will be discussing with the help of a certified debt relief agency. It is also worth noting that debt consolidation cannot exceed more than 5 years.
If a debt is shared, you need to file a joint debt consolidation offer to your creditors. However, in most cases, in which the debts are individually incurred will have no impact on your spouse.
After three missed payments, your debt arrangement with creditors will be broken and you will end up getting chased again for the original debt amount plus interest.
A debt consolidation offer can be paid off earlier if you can. In this way, you receive your “Certificate of Completion” sooner and you can immediately start rebuilding your credit score.
National Debt Relief Services Ontariois a certified Canadian Debt Relief Agency that offers FREE CONSULTATION to your debt consolidation needs. We value the trust given to us by our clients by making sure your personal information is confidential and private. Our personalized plans are designed to tailor fit your financial capacity. Our specialists will get in touch with you by simply answering a few questions thru the link provided below.
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