Worrying about bills you can’t afford to pay is stressful. If money concerns are keeping you awake at night, it might be time to seek the help of a financial counsellor. In Winnipeg, credit counselling has helped many people who are struggling to balance their budgets. Knowing what credit counsellors do may help you decide if credit counselling is right for you.
What is Credit Counselling?
Credit counselling services offer support, education, and assistance to Canadians who are having a hard time repaying their debts. Seminars, one-on-one counselling, and debt management programs are a few of the services offered by debt counsellors.
There are several different service providers available. Counselling services are run by some provincial government offices, others are non-profit organizations, and some are for-profit businesses. Fees vary widely and depend on the provider and services you choose.
It’s important to remember that your creditors are not required to participate in a debt management program; only a bankruptcy or consumer proposal is legally binding. However, many creditors do, knowing that they may lose less money if they work with you, and your debt counsellor. It is important to learn the difference between Licensed Insolvency Trustees and Credit Counsellors.
What Can I Expect From Credit Counselling?
Often, personal money problems can be solved by learning sound money management practices. Credit counsellors can teach you how to:
- Design a budget that fits your circumstances
- Live within your budget
- Pay down or pay off your debt
- Avoid excessive debt in the future
- Maintain a good credit score
- Improve your credit score
- Save regularly
Sometimes, education isn’t enough. Your credit counsellor may suggest that you use a debt management program to get your finances back in order. A debt management plan is arranged through your credit counsellor and provides you with an affordable way to repay your debts.
There are things that your credit counsellor can’t do, including:
- Removing negative items from your credit report
- Obtaining complete forgiveness of debt
- Lowering your indebtedness by more than 50%
- Guaranteeing credit worthiness
- Adding secured debt to your management program
In general, if you find yourself thinking that your credit counsellor can do things you never thought possible, there’s a good chance you’re right. Remember, if it sounds too good to be true, it probably is.
Fees are charged for most credit counselling services, although your first consultation should be free. In fact, if there is a charge for the first meeting, skip that counselling agency and look for another. Your contract should be very clear, outlining what will be charged and how and when those charges should be paid.
Choosing Credit Counselling Services
Choose your credit counselling service carefully and keep in mind that counselling services and costs vary between organizations and businesses. Don’t be shy about asking about the cost, or for debt management program details. You can also find more information at the Financial Consumer Agency of Canada’s website at http://www.fcac-cfc.gc.ca/Eng/resources/publications/budgeting/Pages/GettingH-Obtenirl.aspx
So if you’re looking for credit counselling in Winnipeg, contact us to setup an appointment with one of our licensed Insolvency Trustees.