While British Columbia is one of the most popular provinces to live, it’s also one of the most expensive. The same can be said about the town of Surrey, despite it being further away from Metro Vancouver than some other neighborhoods. Because of that, many of its residents, including yourself, might be in need of financial aid from time to time.
Then again, it can be difficult to find a solution to your money problems, particularly when significant debt is involved. Don’t worry, because that’s exactly why credit counselling exists. In fact, it may be perfect for your situation.
How long does credit counselling take? Find out here.
What is Credit Counselling and How Can it Help?
Money problems don’t just happen in Surrey. Tons of people all over Canada struggle with debt, low income, and financial delinquency everyday, which is why credit counselling was established.
Essentially, it’s a type of service that’s meant to provide people with the knowledge they need to overcome tough economic times. While most consumers choose to go to credit counselling when their back is against the wall, anyone is permitted to attend courses or speak to a credit counsellor.
In fact, the counsellors that work for these kinds of agencies are certified professionals who are trained to deal with situations just like yours (or even worse cases). Whether it’s to tackle your debt problems head-on with some kind of product or program, or simply to gain some knowledge, you’re always welcome to consult a credit counsellor.
Click here to read about what to expect during your first credit counselling session.
Products, programs, and solutions that a credit counsellor can help with include, but aren’t limited to:
- Debt consolidation
- Budgeting and money management courses
- Debt settlements
- Negotiations with lenders and collection agencies
- Consumer proposals
Any good/certified credit counsellor should:
- Be employed by a legitimate service or agency that you can visit
- Have a valid license to operate in British Columbia
- Not try to charge you a service fee before they’ve helped you
- Not judge or insult you because of your financial problems
- Make you feel secure and comfortable talking about your personal finances
- Have a solid reputation for success and no serious complaints against them
Do you know what the true cost of borrowing is? Find out here.
Nonprofit vs. For-Profit Agencies
You’re likely to find two kinds of credit counselling sources in Surrey, some that don’t charge for their services and some that do.
While a for-profit agency shouldn’t charge you upfront, most will expect a flat fee once you’ve completed your sessions, so watch out for that and make sure you can afford it along with all your other expenses. If you can find a good non-profit agency, all the better for you.
Watch Out For Scams
While we’re on the subject of for-profit credit counselling agencies, it’s extremely important to discuss the idea of scamming, fraud, and identity theft, which are all unfortunate possibilities when it comes to many financial solutions.
Scam artists rely on the fact that people with serious money problems are often desperate to resolve their issues by any means necessary. They’ll then pose as for-profit counsellors in an attempt to charge you a ridiculously high fee and trick into handing over your credit/debit card number, or your personal/banking information.
Remember, any legitimate for-profit counsellor should be clear about their fees from the beginning and not charge you before they’ve come up with a viable solution to your problems. If they do demand an upfront payment or it seems like they’re avoiding your questions, be sure to walk away and report them to the proper authorities.
You should also be careful of these other financial scams.
The Potential Impact On Your Credit Score
As helpful and informative as credit counselling can be, remember to think the process through carefully and make sure you’re aware of all the potential consequences involved before you sign up.
For instance, one great thing about credit counselling is that no advice you receive or course you enter will cost you anything other than time and a possible service fee. Unlike many other credit related solutions, no record of the event will show up on your credit report or affect your credit score in any way.
However, some of the products and programs that a credit counsellor can refer you to will impact your credit under certain circumstances. For instance, if they were to help you take out a debt consolidation loan, it would end up on your credit report for several years. Future lenders can see it when you apply for new credit and may choose to decline your application because of it.
A credit counsellor can also help you find a Licensed Insolvency Trustee if declaring bankruptcy is the right option for you. Although this tactic is one of, if not the most effective way of eliminating your consumer debt, it’s also extremely harmful to your finances, particularly when it comes to your credit. Not only will the ordeal be listed on your credit report for 7 years and negatively impact on your credit score, but your credit rating will also drop to the lowest position of R9.
While this notion can be a bit nerve-racking, it’s best to be aware of it if you’re thinking about attending your first credit counselling session. That said, credit damage may be a small price to pay to avoid months, even years of consumer debt.
Check out this infographic to learn even more about what affects your credit score.
When to Attend Credit Counselling
The decision to go to credit counselling can be a tough one. Although it’s a service that anyone can benefit from, it’s not for everyone.
Then again, if your money problems are becoming too hefty to handle by conventional means, credit counselling might be a swift means to a necessary end.
Here are a few signs that you might need credit counselling:
- You’re behind on all your bills
- You’re being subjected to sky-high penalty fees and interest rates
- Your credit/bank accounts have been frozen
- Your lenders are threatening to sue you
- Debt collection agencies are pursuing you for payment
- You’ve fallen victim to identity theft or another serious financial issue
- A consumer proposal or bankruptcy are looking like your only options
Not sure how to choose the best credit counselling service? Check this out.
Get The Help You Need
Whether you’re dealing with credit or debt problems, Loans Canada has a wide variety of options to help you get back on track, get in contact with us today!