Question: Hello, I have about 40,000.00 in credit card debts, I don’t want to claim bankruptcy. Do I have any options??? Thanks.
Answer: Yes, you have a few options.
First, you could attempt to continue to service your debts on your own. If your income improves, you may be able to pay your debts. If you still have reasonably good credit a debt consolidation loan is another possible option. If you can consolidate and lower the interest rate, you may be able to repay your debts on your own.
A debt management plan through a not for profit credit counsellor is a possible option, if you can afford to repay the debts in full, but need a break on the interest charged. If you can raise a lump sum of money, say $20,000, the creditors may accept a lump sum debt settlement, particularly if you are already six months or more in arrears with them.
If those options don’t work, the next option is a consumer proposal. In a consumer proposal you offer to pay a portion of the amount owing over a three to five year period, and the creditors agree to write off the rest. If you have a job, but can’t repay the debts in full, a consumer proposal is an excellent solution.
To find out which option is best for you, you should arrange a no charge initial consultation with an Ontario bankruptcy trustee and proposal administrator, and they will explain the options in detail, and help you make a decision.