Definition of debt
It only makes sense that to get debt help, you need to know how debt is defined. Traditionally, a debt definition includes the concept of decreasing obligations, whether financially or otherwise. According to Dictionary.com, debt is something, typically money, that is owed or due. Synonyms for debt include: bill, account, financial obligation, outstanding payment, amount due, or money owing.
How much debt is too much?
I am often asked this question, and like a good professional, the answer I usually give is, “that depends”. It depends on many factors including income, the interest rate on the debt, how many different debts, or types of debt that are being eliminated or paid down. In addition, other monthly expenses that must be paid factor into the equation. For example, a senior on a fixed pension income who owns their own home may have no problem paying down a moderate debt. However, a young person attempting to purchase a home, finance an education, and do so while paying for daycare expenses will find it hard to pay off even the smallest credit card. There is no magic formula to pay down debt, other than simply decreasing expenses, increasing income, or where possible, doing both simultaneously. That’s where consulting with a Licensed Insolvency Trustee comes in.
How much debt do I need to file bankruptcy?
Interestingly enough, by the definition given in the Bankruptcy and Insolvency Act, a debtor (person who owes money) need only owe $1,000.00 in order to qualify to file bankruptcy. However, in practice, we usually help people owing anywhere from $5,000.00 to $5 million – depending on whether we are talking about individuals or businesses. If you aren’t sure how to pay off your debt, or are tired of just paying interest and never paying down the principal, contact a Licensed Insolvency Trustee today to discuss options. Bankruptcy isn’t the only option when it comes to dealing with debt.
I want to pay my debts, I just can’t pay what they want! Can you help?
Consider talking with us about filing a Consumer Proposal. Not sure what that is? Generally speaking, a Consumer Proposal is a binding agreement between you and your creditors (banks, credit cards, student loans etc.). A Consumer Proposal allows payments that you can reasonably afford, while offering protection from your creditors. Not sure how to get an agreement with your creditors? Ask us – Licensed Insolvency Trustees are trained to be able to assess the situation, outline the options, and complete the paperwork and services necessary to start the process of creating this binding agreement.