Services offered by credit counsellors

Is your debt a little out of control? Find out which services are offered by credit counsellors, and whether they can help you pay down your debt.

Credit counsellors exist to help individuals and families learn responsible financial behaviour.

• The services offered by credit counsellors include credit and debt counselling, money management education, or alternatives to debt consolidation, to name a few.

Credit counselling is the process that combines credit education and debt relief through debt management programs.

• There are two main types of credit counselling agencies: non-profit and independent credit counsellors.

Non-profit agencies are funded mostly by the same creditors that you likely owe money to, through a program called “fairshare,” which works on a commission-based structure.

Independent agencies, on the other hand, are funded solely by their clients.

Three of the main types of services offered by credit counsellor agencies are:

Debt consolidation

Debt consolidation combines all your debts into one, so you make one monthly repayment toward your debts instead of several.

• It’s a better alternative to bankruptcy since it does less damage to your credit history than bankruptcy does.
• A credit counsellor can talk you through every step in the process of debt consolidation.

Credit Card Debt

Credit card debt is one of the most common types of unsecured debt in North America.

• In tough times, many families pay for their necessities by credit, and when they can’t repay it in full, their interest grows, creating a bigger sum they can’t repay.
• Credit counsellors can help you to reduce or completely eliminate those high interest rates, avoid bankruptcy, and start the journey to a debt-free life.

Debt settlement

Debt settlement is an alternative to a consumer proposal or bankruptcy, and can in some instances cut down personal debt by up to 70 per cent.

• The goal of debt settlement is to reduce your debt significantly within a short period of time so that you can move on with your life and begin to rebuild your financial situation.
• It’s not a loan or a monthly payment plan, but is ideal for those who are able to make a lump-sum payment.