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Debt Consolidation Loans in Canada

Managing a slew of debts from different places can be overwhelming. Multiple payments being withdrawn from your bank account and taking chunks out of your paycheque can be challenging.
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Why Apply for Debt Consolidation Loans With Our Partners?

When you apply for a loan through our partner network, you benefit from being matched with the best debt consolidation loan solution and lender in order to best suit you and your needs. The algorithm takes into consideration your location and the information you provide such as your income, and credit score in order to find the best match for you. Once a lender has been recommended for you, a simple application is usually required. Sometimes, the lender will require proof of employment and identification, but not always. Once you have provided all of the necessary documentation, it will be determined whether or not you qualify. If approved, most lenders will transfer the funds directly into your bank account. In many cases, this may happen in a matter of hours. More benefits to a debt consolidation solution are:

  • Reduce your monthly payments
  • Settle with your creditors
  • Avoid bankruptcy
  • There is no obligation to borrow
  • Stop collection calls

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How Our Partner Network Operates

There are thousands of lenders across Canada making choosing the right one difficult, not to mention extremely time consuming. You need money now and you need a process that makes getting a debt consolidation loan quick, reliable and easy. It’s for those reasons we have partnered with the best loan solution aggregators in Canada.

What does that mean? It’s quite simple. By providing basic information on your intent to secure a debt consolidation loan in Canada, our partners will electronically produce, in lightning speed, the online lenders that can service your request. This process shaves endless hours, and possibly days off the time you would normally have spent trying to find a lender.

Now, you can begin to clear your debts and rehabilitate your credit with a plan that is tailored to your needs. Get of out of debt in two ways:

  1. Connect to the best debt consolidation experts in the country.
  2. Negotiate with creditors, a process which results in lower overall monthly payments, reduced debt and assists Canadians with rebuilding their credit.

Is a Debt Consolidation Loan Right for You?

Debt consolidation loans are ideal for those who have a steady income, but are still behind on payments, and are only making minimum payments on their debt, or have accumulated a large amount of debt. They can have many advantages such as:

  • Improve your credit score
  • Can reduce your monthly debt payments into one manageable payment
  • May provide a much lower interest rate
  • Can help to pay off your debts faster
  • Can help you take control of your finances

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Questions a Debt Relief Professional Will Be Able to Answer

When you connect with a debt consolidation lender, consulting with a professional about your debt can be highly beneficial and necessary. Having these questions answered will ensure that you are headed in the right direction in terms of your debt consolidation loan.
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What are the different types of services offered?

You’re making a big financial decision here. It’s important to understand what types of services are offered at the place you are doing business. For example, is it an exclusively debt consolidation agency? Are they offering home equity loans? Lines of credit? Debt management programs? These are important questions that need to be answered before you commit to working with the company.

What fees am I subject to?

It’s never wise to sign any agreement before reading the fine print. Debt consolidation lenders often have additional fees in place. They could be in the form of administration fees, late payment fees, early payoff fees and others as well. Fees will vary across lenders but it most cases

Are you a licensed entity? What accreditations and qualifications do you have?

There are no specific licenses in Canada that need to be earned in order for an individual or company to be able to offer loans. What you’re looking for however, is a credit counsellor to be trained well enough to be able to deal with your situation in a professional, timely and trustworthy way. Don’t hesitate to ask for references and read their online reviews before you make the decision to work with them.

Can you provide me with the guidance I am looking for?

The type of advice you will need widely depends on what kind of loan you are looking for and what your financial situation is right now. Be wary of those who may offer ‘quick fixes’. Something that seems too good to be true, generally is. Make sure you feel at ease with the person you are working with.

What is a Debt Consolidation Loan?

A debt consolidation loan allows you to combine all of your outstanding debt into one singular monthly payment. You can consolidate your debt by going to a bank, credit counselling agency, or any other financial institution that will give you a loan to pay off all of your debts.

For this debt relief method to work, you must make sure that the interest rate on the new loan is lower than that of your previous loans.

A debt consolidation loan is in essence, a personal loan which combines all of your outstanding debt into one manageable payment. Using this method, you only have to make one monthly payment, instead of several payments.

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Debt consolidation loans are also beneficial for the following reasons:

You only have to make one monthly payment

Having to make one payment a month is much more manageable than having to pay five different creditors.

Lowers the interest rate

The whole point of consolidating your debt is to take advantage of a more affordable interest rate. One that is lower than what you were paying with your previous creditors. This decrease in interest will help lower your payments and save you money.

Lower monthly payments

With a lower rate, you’ll have lower monthly payments and it will be easier to keep up with your debt burden.

Debt can also be paid off faster

Due to the decrease in interest, your overall amount owed decreased and thus requires less time to pay off.

Usually have lower fees

Eliminating credit card fees and other bank fees can also save you money in the long run.

Debt Consolidation 101

As you move to make a decision on whether or not to consolidate your debts, it’s wise to know a few of the key terms that you may hear during the process.

Bankruptcy

Bankruptcy is typically a last resort for those who are overcome with debt. It’s not always the only option. Bankruptcy is the dismissal of most or all of your debts by way of legal proceedings and the process is overseen by a Licensed Insolvency Trustee. Certain assets may not be protected during bankruptcy and could be seized to pay for some outstanding debts, such as cars or homes. If you have surplus income, some of that may be utilized to pay your debts for up to 21 months. If you are in a second bankruptcy, this could be 36 months. Filing for bankruptcy has significant long-term consequences which could include having the lowest possible credit score and a negative impact on your credit standing for up to 7 years. It’s critical to consider all of your options before taking this route.

Consumer Proposal

Individuals can opt for a consumer proposal which is a way to pay off debts over a period of up to 5 years. A Licensed Insolvency Trustee must file the proposal on your behalf. They will also serve as the liaison between you and your creditors. They will assess your assets and your income along with the amount that you owe to determine the total which needs to be paid back. Payments are made directly to the trustee, who then distributes the funds to your creditors. A consumer proposal is a legal binding contract and for that reason, your creditors are forbidden to call you anymore. They are also not allowed to file legal proceedings against you. A consumer proposal is a viable alternative to bankruptcy as it only impacts your credit for up to three years, rather than 7.

Debt Settlement Program

If your debt load is $4000 or less, you may be able to reach an agreement with your creditors. Some will even accept a payment of $1500 to settle. There are drawbacks to debt settlement programs however. They include:
  • Debt settlement companies typically charge higher amounts for their services and this is typically regardless of whether or not they were able to come to an agreement for you
  • While negotiating a settlement amount, payments may be delayed which can impact your credit score and result in late fees
  • Each creditor must be negotiated with separately
  • For each account you settle with, it will be listed on your credit report as "settled" rather than "paid as agreed"

Credit Counselling

A credit counselling agency will offer a range of services to those who are struggling with debt and related financial issues. The services a credit counsellor will be able to provide you are money management, improving your credit score and debt elimination. They can also provide you with pertinent information about developing a plan to achieve your financial goals. When you seek the assistance of a credit counsellor, your credit score will not be impacted at all.

How Does It Work?

At Insurdinary, we help you get connected with major loan providers in Canada to give you the best available out there and let you choose the right product for you.

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Applying is easy, fast and secure. You can get approved and funded as early as today.
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Get matched with a lender and accept your quote with terms and a plan that works for you.

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Funds are deposited into your account and repayments are made easy with automated debits.

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Frequently Asked Questions (FAQ)

You’ve got questions, we’ve got answers. Learn all about finding and applying for personal loans online in our FAQ section below.

Does the Canadian Government offer debt relief services?

The government of Canada does not offer any specific debt relief programs or products.

What is the difference between unsecured and secured debt?

Secured debt is backed by collateral in the form of an asset, typically a vehicle or house. Collateral lessens the risk for the lender and sometimes allows a borrower to gain access to a larger loan or a lower interest rate. In the event that a borrower defaults on a secured loan, the lender has the right to seize the assets to recoup any losses.

Unsecured debt, on the other hand, does not require any form of collateral or security.

What is insolvency?

Insolvency is the state of being unable to repay your debt. A borrower who is insolvent typically must seek professional help to deal with their debt issues.

What is re-aged debt?

If you owe money, your lenders have a certain period of time to take legal action against you. This period is called the statute of limitations which varies by province. After this period, lenders cannot pursue you to repay the debt, unless you reset the statute of limitations.

What is the best online loan?

The “best” online loan varies based on your unique needs. We’ve recommended lenders that offer low interest rates, great repayment plans, and a variety of borrowing options.

You’ll need to consider your own financial situation before choosing the best loan for you.

How do I find online loans with low interest rates?

Insurdinary.ca recommends a variety of online lenders that offer low interest rates, including variable and fixed interest rate options.

What’s “low” may depend on your credit score, the amount of money you want, and what your repayment schedule will look like.

Can I qualify for a loan if I have bad credit?

In short, yes. Not all lenders require a credit check, but many do. Most banks require a soft credit check to determine pre-approval, then a hard credit check if you agree to sign up for the loan.

Some brokers don’t require a credit check at all and will set you up with lenders who will send you money within a day, no matter whether you have bad or good credit.

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