One Size DOESN'T Fit All: Debt settlement

"Believe it or not, the radio commercials out there, the ones professing to have access to government programs that will help you eliminate debt (no such 'government program' exists in reality), have a lot of people thinking there are relatively pain-free ways to simply walk away from the debt they've incurred. In some cases, people even think they might be able to pull off this process all on their own..."


There's a lot of one-size-fits-all advice out there online, but it's also pretty common to find it in somewhat unexpected places as well – at your local bank, for example.

Here's the thing: No matter how good something sounds, or how well-intentioned the advice might be, if it's boilerplate or not right for you, there's a fair chance that it's not worth following with blind acceptance.

We asked three experts, all with different backgrounds, to talk about the overly-generic advice they see on a regular basis, and how to recognize when certain advice might NOT be quite appropriate to your situation.

See also:
The financial journalist – Rob Carrick, The Globe and Mail
The lawyer – Pat Robinson, Goodmans LLP



Laurie Campbell, CEO
Credit Canada Debt Solutions

Believe it or not, the radio commercials out there, the ones professing to have access to government programs that will help you eliminate debt (no such 'government program' exists in reality), have a lot of people thinking there are relatively pain-free ways to simply walk away from the debt they've incurred. In some cases, people even think they might be able to pull off this process all on their own.


RELATED ARTICLES:
What Is Debt Settlement?
Debt Settlement: Important Questions to Ask
FCAC Issues Consumer Alert on Debt Reduction Companies


"If you want to have your debt reduced, it's called a consumer proposal – it's a legislative piece under the Bankruptcy and Insolvency Act," says Laurie Campbell, CEO of Credit Canada Debt Solutions.

"People will then try to do it themselves. In their mind, they believe if they tell their story, which could be legitimate, a reasonable person will listen to it. Without the aid of a bankruptcy trustee or credit counseling service though, some professional to intervene, provide documentation, and legitimacy to the situation, it's very difficult for a creditor to make a decision based on that individual's testament alone."

As well, she strongly recommends consumers do their research on any company that claims it can reduce your debt by any significant amount in a short period of time.

Questions to ask:

• How long has the company been in business?
• What is their specialty?
• Also check the company out with the Ministry of Consumer Services where businesses are registered.

"What kind of reputation do they have? Ask around," she adds. If companies are nefarious, other professionals (and your creditors) won't work with them. Those with U.S. connections (many were driven out of the U.S. by legislation) and those with only a few years in the business should be reviewed especially thoroughly.

"When people are in trouble, there are vultures out there who are more than willing to take your money. You're vulnerable and more than willing to try for a quick resolution.


More One Size DOESN'T Fit All:
Advice From Your Bank (Rob Carrick, The Globe and Mail)
Your Last Will and Testament (Pat Robinson, Gowlings LLP)


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Kate McCaffery is a freelance writer, editor and former urbanite, now living somewhere in between the lake, the ski hill and some farmer's cow path. Visit mccaffery.ca/kate2.0/ for more information.