When it is time to declare bankruptcy, many Canadians decide not to do so. Although declaring bankruptcy provides long-term financial assistance, this method is linked to a bad stigma that can follow the individual throughout his life. According to the Office of the Superintendent of Bankruptcy Canada, 71,495 Canadians went bankrupt in 2012, a decrease of 8% from the previous year.

 

When should you consider this option?

According to experts, the best time to declare bankruptcy is when no other option is offered to you. For example, if you are no longer able to stay, if you have sold all your assets and it is impossible to improve your financial situation, it is time to sign the papers.

 

What to do first

Before declaring bankruptcy, make sure you have used all other possible means. For example, financial institutions could make an arrangement to pay less than your original debt. Consider this option before embarking on more drastic decisions. It is obvious that negotiating with creditors is not an easy task and this method does not always work. But it’s worth it to try and do it first.

 

Consider counseling services

Another option to consider would be consultation services. Visit them. Talk about your situation. Make a budget. Find out what you need to get out of this financial hole. On the other hand, it can only work if you have the means to repay the payments required by the financial institutions. If you have income and you can repay it, you have one more step in the right direction.
But again, note that many people do not succeed even after a consultation. This is often related to the fact that they do not have the funds to pay their debts. If you find yourself in this situation, declaring bankruptcy is perhaps the best solution for you.

 

Debt Consolidation Loans

For those still having good credit, declaring bankruptcy could cause some problems. As soon as it is reported, Equifax Canada learns and places it on your file and posted in your public credit history. Of course, after declaring bankruptcy, you end up without credit. In order to find him, you must have good financial months in front of you.

For this reason, many individuals are turning to debt consolidation to consolidate all debts into one. Or, you must be able to make this payment, of course. On the other hand, there is another glitch: you must also have the means to pay the big interest rate. As a result, many individuals close to bankruptcy can not afford these loans.

What should you do? Providing assistance to a financial consultant is definitely a good step forward. Meet a bankruptcy lawyer to discuss your situation. It is important to learn as much as you can before making big decisions. Analyze all possible options, but remember that bankruptcy may be the best solution.