Personal debt places significant pressure on many people living in Quebec. Unexpected life events, such as layoffs and family emergencies, can quickly make it difficult to stay on top of bills. The good news is that residents of Quebec have access to several financial relief solutions designed to help take back control and reduce debt-related stress. Read on to discover some of the most common options available and how they work.
Debt Relief Options Available in Quebec
Choosing the right debt solution depends on your income, assets, and overall financial situation. Here are the main strategies commonly used by consumers in Quebec:
- Debt Consolidation Loan: This program combines several debts, such as credit cards or unsecured loans, into a single loan. Ideally, the new debt consolidation loan comes with a lower rate, helping reduce the total borrowing costs while simplifying repayment.
- Debt Consolidation Program: Unlike a loan, a consolidation program does not involve borrowing money. A credit counsellor works with your creditors to bundle your debts into one monthly payment based on what you can afford. The focus is on structured repayment instead.
- Consumer Proposal: A consumer proposal is a legally binding settlement arranged by a Licensed Insolvency Trustee (LIT). Creditors agree to accept partial repayment over a set period. Once approved, interest and collection activity stops, and you keep your assets while paying back less than the full balance owed.
- Bankruptcy: Bankruptcy is a formal legal process meant for those who can’t repay their debts. It eliminates most unsecured obligations and immediately stops creditor actions, such as wage garnishment. While effective, bankruptcy typically requires asset surrender and has a major impact on your credit score.
How Your Debt Compares In Quebec
Evaluating your financial situation against provincial averages can help you determine whether you need to explore debt relief options. As of the most recent data, Quebec consumers carry an average of $18,985 in non-mortgage debt, reflecting a 2.28% increase year-over-year.
Rising housing expenses, inflation, and slow wage growth continue to drive this upward trend. If your debt load is well above this level, exploring relief options may be a good idea.
When To Seek Professional Debt Help
If your balances keep growing despite your best efforts, professional assistance may provide relief. Credit counsellors can help you create a budget, negotiate repayment terms, and establish a manageable plan.
For formal legal solutions such as consumer proposals or bankruptcy, only a Licensed Insolvency Trustee is authorized to administer these processes in Quebec and the rest of Canada.
| Are Credit Counsellors Regulated In Quebec? Credit counsellors operating in Quebec are not required to be licensed, unlike LITs, who are federally regulated. This makes it especially important to research counselling organizations before committing to any service. |
Finding Debt Help In Quebec
Many organizations offer debt-related services across the province. Here are a few notable services available in Quebec:
| Agency | Services | |
| BDO Debt Solutions | – Consumer proposals – Bankruptcy – Debt consolidation – Credit rebuilding guidance | Learn More |
| MNP | – Personal bankruptcy – Consumer proposals – Debt consolidation – Financial assessments – Budgeting support | Learn More |
| Credit Counselling Society | – Credit counselling – Budgeting assistance – Debt consolidation – Personalized repayment plans | Learn More |
Debt Consolidation Loans
A consolidation loan allows you to replace multiple debts with one new loan, simplifying bill management and lowering interest charges. Common consolidation methods include the following:
| Personal Loans | Unsecured personal loans provide a fixed amount repaid over a set term with predictable monthly payments. |
| Home Equity Loans | Homeowners may be able to use available equity to consolidate debt at a lower rate, though this places the home at risk if payments are missed. |
| Credit Card Balance Transfers | Some credit cards offer promotional interest rates for transferred balances. These offers are most effective if you can repay the full debt before the promotional period expires. |
Will There Be A Negative Effect On My Credit Score By Consolidating?
Applying for a consolidation loan can cause a short-term dip in your credit score due to hard credit checks. Closing old accounts may also affect your credit history length. However, making consistent, on-time payments over time often leads to improved credit health.
Debt Management Programs (DMPs)
A debt management program is administered by a credit counsellor who negotiates directly with your creditors. After reviewing your finances, the counsellor may negotiate lower rates, waived fees, and ceasing of collection efforts. You make one monthly payment to the credit counselling agency, which distributes funds to creditors on your behalf.
Learn more: Debt Management Program (DMP)
Debt Settlement
Debt settlement involves negotiating with your creditors to accept less than the full amount owed. This is usually done through a third-party settlement company and often requires making a lump-sum payment. Keep in mind that while it can lower balances, it may negatively affect your credit and doesn’t guarantee creditor participation.
Consumer Proposal
A consumer proposal is administered by an LIT and is available to individuals with less than $250,000 in unsecured debt (excluding mortgages). The trustee presents a structured repayment offer to your creditors, which can lead to significant debt reduction. Once approved, legal protections apply right away.
Bankruptcy
Bankruptcy is designed for those who cannot repay their debts. Also administered by an LIT, it eliminates most unsecured debts and stops all legal collection actions. Typically, the process lasts 9 months, or up to 21 months for those with surplus income. After completion, you’re legally discharged from qualifying debts.
Learn more: Bankruptcy Quebec
Important Things To Consider Before Choosing Debt Relief
Before applying for a specific debt relief program in Quebec, consider the following:
Know Your Consumer Rights
Debt collection in Quebec is governed by the Office de la protection du consommateur (OPC). Collection agencies must be licensed and are prohibited from harassment, deceptive practices, or contacting consumers outside permitted hours. Written notice is required before collection begins.
If you believe a collector has acted unfairly with you, you can contact the OPC at 1-888-672-2556.
Avoid Debt Relief Scams
Unfortunately, fraudulent companies often target individuals under financial stress. Be cautious if a company does any of the following:
- Demands payment before providing services
- Promises instant debt elimination or credit repair
- Uses high-pressure sales tactics
- Requests sensitive information without entering into an agreement first
- Can’t give a physical address
Protect yourself by checking reviews, verifying credentials, and withholding personal information until you can verify the agency’s legitimacy.
Understand All Fees
Some counselling services charge small fees after free consultations. Always ask for full fee disclosure.
Fees for Licensed Insolvency Trustees are regulated and generally included in the repayment arrangement.
Additional Support Programs For Quebec Residents
In addition to debt-specific solutions, several programs are available in Quebec to help with essential living costs:
Rental Assistance
Quebec’s Shelter Allowance Program provides financial assistance to help low‑income individuals and families who are struggling to cover rent. The program provides up to $170 per month toward rent or housing costs.
Utility Support
Residents facing difficulty paying electricity or gas bills may qualify for utility assistance programs in Quebec. While not specific to this province, the Low-income Energy Assistance Program (LEAP) provides Canadians with up to $1,000 of utility bill amounts owed, as well as up to $1,200 for electrically-heated homes.
Emergency Housing
Temporary shelter is available across Quebec for individuals facing homelessness, including the following:
- Maison Revivre: 261 Rue Saint-Vallier O, Québec, QC
- Abri de la Rive-Sud: 459 Chem. du Coteau-Rouge, Longueuil, QC
- The Open Door / La Porte Ouverte: 3535 Av. du Parc, Montréal, QC
Food Banks
Food banks throughout the province help households manage grocery costs. Here are a few to consider:
- Le Dépôt Centre communautaire d’alimentation (Marché Dépôt): 6450 Av. Somerled, Montréal, QC
- Bouchee Genereuse: 530 Boulevard Wilfrid-Hamel, 480 Rue Fleur-de-Lys, Québec, QC
- Moisson Québec: 2909 Ave Kepler, Québec City, QC
Learn more: How To Find Food Banks In Canada
FAQs About Debt Relief In Quebec
What debt relief options are available in Quebec?
How does voluntary deposit (Loi sur le dépôt volontaire) work?
Will debt relief affect my credit score in Quebec?
Are all types of debt included in debt relief programs?
Can I keep my home or car if I file for debt relief?
®Fairstone Financial Inc. is a wholly owned subsidiary of Fairstone Bank of Canada.
*Interest rates are subject to change. Actual Annual Percentage Rate (APR) varies based on the province of residence and individual factors like credit details and loan amount. The interest rate on an unsecured personal loan is 31.99% in BC.
Fairstone Financial Inc. holds high-cost credit licenses in AB, MB (License #85047, expiring 20-02-2026) and QC; it has applied for a high-cost credit grantor license in NL. For license information by province, visit Fairstone.ca/HCCG
