Debt Relief – Serious Options For Serious Situations

debt relief

If you’ve decided that it’s time to take control of your life and get out of debt, you’ve probably taken some first steps towards your goal.

These might include writing down all of your debts, amounts and interest rates. You might have set up a budget, cut some expenses, and used some online calculators to figure out how long it will take you to get out of debt in your current situation.

If you’ve really gotten intense with it you might have taken a second job or started a home business to generate extra income.

With a manageable debt level, these are all incredibly powerful steps that will have you reach your goal faster than you ever thought possible.

When It’s Not Enough

But what if you’re really struggling? What if you lost a job or have a medical issue that’s either putting you further in debt or limiting your ability to work? 

This is an extreme situation, and today we’re going to talk about some extreme solutions.  It’s important to understand that no matter how desperate your situation is or how impossible it looks, there ARE options and solutions for you.

You may want to simply start with credit counseling where a professional will look at your debts and income and help you come up with a plan.

Debt Relief And How It Can Help You

Tackling debt on your own, you’ll either pay off your debts on your own terms (probably while paying huge amounts in interest), or you’ll end up defaulting and have your debts go to a collection agency.

Once it gets to this stage you can expect constant phone calls and threats of being sued or forced into bankruptcy. You don’t want to get to this stage.

Unfortunately most people have never been in this situation before and don’t know what their options are.

Debt relief is an umbrella term that covers several different options for helping you consolidate your debts, negotiate with creditors, and ultimately construct a debt payoff plan that you can actually succeed with.

Debt Settlement

Once your debt has gone to collections, an agent will negotiate a settlement on your behalf.

Canadian debt relief can help make paying off your debt easier as agents will be able to help you save on interest rates and avoid bankruptcy. They also take a lot of the stress away as you won’t be getting harassed by collectors.

Debt Consolidation

This involves borrowing the total amount you owe, paying off all of your debts, and focusing on this one single payment.  This is great because you can negotiate a lower interest rate, have a more comfortable single monthly payment, and avoid getting calls by collectors.

Getting Drastic

The last two options available are a Consumer Proposal and actual bankruptcy. Both have fairly serious consequences and should only be used as a very last resort.


    • Kyle @

      Kyle @ 01/11/2013 10:27 a.m. #

      Good advice for a scary situation. I hope I never have to use any debt services. I believe frugal living will help me get there.

    • DC @ Young Adult Money

      DC @ Young Adult Money 01/11/2013 11:20 a.m. #

      Consolidating debt and getting it down to 0% interest can be a win for everyone involved. It's an unfortunate situation but people really show resolve when they are facing debt.

      • Tackling Our Debt

        Tackling Our Debt 01/11/2013 11:28 a.m. #

        Consolidating debt works if you do it while you still have time and you qualify for the loan. Debt settlement is necessary for people that wait too long and are in serious trouble, but it is still a better alternative than bankruptcy, in most cases.

    • Corina Ramos

      Corina Ramos 01/11/2013 3:01 p.m. #

      Debt is a scary situation for anybody and goodness knows I've seen my share of it. Your post sure does put us at ease and telling us about the options out there.

      Although I had a bad experience with a debt consolidation company about 10 years ago, I'm willing to give it a try if I ever need to, just have to do more homework.

      Thanks for sharing, Sicorra,great post Lady!


      • Tackling Our Debt

        Tackling Our Debt 01/11/2013 3:34 p.m. #

        It is interesting you mention that you had a bad experience. There are some companies that have popped up in Canada and have ads all over the Internet but it is hard to tell if they are legit or not. Like you said, a person needs to do some investigation.

    • Laurie

      Laurie 01/15/2013 5:24 p.m. #

      Sicorra, great post! Thanks for covering the different options out there. Needing help, and getting it, isn't something to be ashamed of, but rather people should be commended for taking the steps needed to get their finances in order.

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