Que faire lorsque l’endettement devient problématique?November 3, 2016

How to Deal with a Debt Problem

Juggling all of the debt one accumulates in life can be overwhelming. Sometimes, debts may engulf us like a giant landslide, making the situation appear completely hopeless. Fortunately, though, you are far from alone in this type of predicament - many of your fellow Quebecers also, at one time or another, find themselves in a tough situation financially due to debt. Take a look at the following tips to identify whether you have a serious debt problem or not.

How can I understand that my debts are becoming a problem?

Ask yourself the following questions:

  • Do you regularly go over your budget?
  • Do you pay with credit cards on a day to day basis?
  • Do you have to borrow money every month to make ends meet?
  • Have you ever had utility services interrupted because you didn’t pay bills on time?
  • Have you been repeatedly harassed by your creditors (by phone, email and so on) trying to make you pay them back and threatening you with legal action or loss of property?

If your answered “yes” to one or more of these questions, you may be having a debt problem. Solutions are available and depend on the severity of the situation.

What can I do?

Once you’ve acknowledged the situation, it’s important to quickly deal with it. To this end, if you aren’t doing so already, you should put together a budget.

Once you have a budget, you will be in a better position to balance your spending and identify expenses you can eliminate or at least reduce. In the short term, it’s usually easier to cut irregular expenses, especially personal ones. For example, you could wait a bit longer for a haircut or look into a cheaper Internet or cell phone plan.

Also look if you can dispose of certain items. This can allow you not only to find a little money, but also to free up space. Could a debt consolidation be possible? In any case, remember to contact your creditors. Before negotiating an agreement, however, be sure to prepare by consulting a financial adviser who can guide you through the process.

A few words of caution

Whatever your particular situation may be, beware of people that offer a magical fix to your problems that would somehow help you repay all of your debts at once.

Some solutions may appear attractive, yet it is vital to avoid unrealistic repayment agreements at all cost. In simple terms, if an agreement does not match your practical ability to pay, it is not for you.

If you employ a bankruptcy trustee, you must remain cautious. Remember that the first consultation is usually free and does not mean a commitment to any agreement, as you do not have an obligation to sign a consumer proposal or bankruptcy declaration then. Do not rush into a decision that would stay in your credit history for many years to come.

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