The Financial Consumer Agency of Canada ( FCAC ) has recently issued a consumer alert about being cautious if you are looking for a company to help you pay off your debt or repair your credit.
If you are struggling with your debt, you need to remember:
1) No company can guarantee they will solve your debt problems
No one can solve your debt problem quickly. You should never pay a company money to negotiate with your creditors for you.
2) Your credit score cannot be quickly or easily fixed
It is impossible to change or erase information on your credit history, unless it is actually wrong. Improving your credit score takes time as you have to rebuild your credit by making payments on time, and not taking on more debt than you can handle.
3) You should never take out a loan from a company
Some companies may encourage you to take a loan from them to rebuild your credit. These loans are very expensive (with a high interest rate and fees), and it does not help you eliminate any of your other debts.
4) Companies may misrepresent services they offer as being part of a Government program
In Alberta, you can access a program called Orderly Payments of Debt. This debt consolidation program was created by the Government, and is ONLY available through Money Mentors. The Credit Counselling Society is another good option if you are looking for help.
If you are looking for more information on debt repayment, consider attending a Credit workshop here at Momentum.