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The Hidden Cost of Debt Relief: What You Need to Watch Out For

Debt relief may seem like a terrific way to solve a money issue, but there may be unanticipated charges involved. Debt relief options are readily accessible in Canada, but consumers should exercise caution when choosing one to avoid worsening their financial circumstances.

This article will discuss what to watch out for and the hidden expenses of debt relief in Canada.

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The Different Types of Debt Relief Programs in Canada

Let’s first explore the many sorts of debt relief programs available in Canada before we go into the hidden expenses of debt relief.

Credit counseling

offers advice and instruction on how to manage debt, set up spending plans, bargain with creditors, and gain financial literacy.

Debt consolidation

Multiple debts are consolidated into a single loan or line of credit with a lower interest rate; this is debt consolidation. The objective of debt consolidation is to simplify the repayment process by facilitating the borrower’s ability to manage their debt and potentially save money on interest charges. Typically, the borrower takes out a new loan to pay off all their existing obligations, leaving them with a single monthly payment. There are numerous ways to consolidate debt, including obtaining a personal loan, using a balance transfer credit card, or delving into home equity.

 

 

The Hidden Cost of Debt Relief Programs in Canada

Debt relief programs can be beneficial for individuals who are having financial difficulties, but there are certain unanticipated expenses that you should be aware of. Some of the most frequent unintentional expenses of debt reduction schemes in Canada are listed below:

Fees:

Some programs for debt relief require a fee for their services. It is important that you research or inquire about these fees before committing yourself to a debt relief program in Ontario. Fees may differ but this is manageable. Meaning, you compared to the total amount that you should be paying for all your debt – these fees are fair and still acceptable. Before committing to a debt relief program, you should carefully analyze these costs to be sure they are fair.

Interest Rates:

The interest rates on debt consolidation loans may be greater than those on your current bills. Even while your monthly payments could be reduced, you can wind up paying more in interest over the course of the loan. But, there are some debt consolidation programs that will stop all interest rates and even reduce your total debt up to 75%. 

Credit Score:

Programs for debt relief may lower your credit score. Before committing to a debt relief program, it’s critical to understand how it may affect your credit score. Though it may initially affect your credit score negatively, if you make consistent and complete payments your credit score will progressively improve. 

Legal Fees:

It is important that you also clarify if there will be legal fees involved regardless of the option you choose. 

Taxes:

You could have to pay taxes on the amount forgiven if you settle a debt for less than what is owed. Many individuals are unaware of this potential large expense.

 

 

How to Avoid the Hidden Costs of Debt Relief Programs in Canada

After looking at the hidden costs related to Canadian debt relief programs, let’s talk about ways to prevent them.

Do Your Research:

Conduct your homework before committing to a debt reduction program. Check for ratings and recommendations from other users of the application. Verify the program’s reputation and success rate by contacting the Better Business Bureau.

Read the Fine Print:

Prior to enrolling in a debt relief program, be sure you are aware of all of the terms and conditions. The cost, the interest rate, and the effect on your credit score are all included. If there is anything you don’t understand, don’t be scared to ask questions and get more information.

Think About All Your Options:

Before enrolling in a debt relief program, take all of your alternatives into account. There may be workable alternatives that don’t have the same hidden expenses as credit counseling and debt consolidation.

◾Consult a Professional: If you’re not sure which debt relief program in Ontario is best for you, seek advice from an expert. You may learn about all of your alternatives from a Licensed Insolvency Trustee, who can also guide you toward an educated choice.

 

 

 

 

“National Debt Relief is here to assist you in reaching financial independence and making wise decisions.”

Take action immediately to protect yourself against the hidden costs of debt relief programs in Ontario. To learn more about our debt relief options, get in touch with us right away.

Debt Relief Program Ontario

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Jennifer Chenier
Jennifer Chenier
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I was lost ... single mom... off due to Covid for 3 months .. did what it took to pay bills and look after my kids... and left with nothing but a tonne of debt I could not keep up with 😢. And then ....I met Connie.. Connie gave me my life back. The entire experience was like talking to my mother. She was full of compassion and knowledge and took me under her wing for this entire process. She turned tears into smiles and hope . She reassured me.. and made me feel like it was Going to be ok. I can’t thank her and the team (Paul) enough for helping me through this . I highly recommend National Debt Services to anyone looking for help with their debt . Start living again ❤️. Thanks Connie Jen
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Katherina Preston
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"So glad I finally had the courage to make the call" Suma was amazing.. she guided me through my options and got the answers to all my questions. By the end of our very first phone conversation I had hope again...finally...no more sleepless nights worrying my debt ....Thank you National Debt Relief Services
Chris V
Chris V
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I would just like to thank Suma for really making feel comfortable throughout this entire process. Everyone tells you to watch out for gimmicks, quick fixes, and everything else that comes with Debt. Ive had other companies who had made promises and under delivered. However Suma and her team are quick to provide the right answers and guide everyone in a way towards better credit. She has made it seamless with great communication and availability. I have personally referred her to several of my closest friends and i would recommend her to anyone else looking for consolidation.
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Top 5 Key Benefits of our Ontario Debt Relief Program:

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.

Do you want to experience Peace of Mind from all of these?

  • Credit Card Debts
  • Personal Loans
  • Car Loans
  • Taxes
  • HST
  • 407
  • Household Bills
  • Payday Loans
  • Student Loan
  • and more…

Talk to us! We will help you get out of debt.

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.

We will help you compare
the options and savings of all formal debt relief programs available to you.

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Frequently Asked Questions

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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