4. Apply for a consolidation loan

Are there options other than bankruptcy if I'm in debt?
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4. Apply for a consolidation loan

With a consolidation loan, the bank will lend you the total amount you owe so that you can pay off your other debts. You then have only one payment to manage. You usually have to have a good credit score or a regular income, or a guarantor to co-sign the loan.

Most credit unions and banks offer consolidation loans. Usually they will lend you an amount equal to 10% of your assets or less. Your assets include anything you own that can be sold for money. Assets can include a house, a car, valuable jewellery, or investments. If you have $20,000 worth of assets, you might be able to get a $2,000 loan.

A bank will also look at your credit score before they decide to lend to you. If you are approved for a loan, it’s important to make the monthly payments as scheduled. If you do not make the payments, your credit score will be affected.

A financial advisor at your bank can help you to apply for a consolidation loan.

You May Also Need

Office of the Superintendent of Bankruptcy Canada
Office of Consumer Affairs
Reviewed: April 17, 2017

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