Debt remains a significant financial burden for many residents of New Brunswick. This is especially true during challenging times like job loss, health setbacks, or unforeseen expenses that put a strain on budgets.
Fortunately, many options exist to assist New Brunswick residents in managing and reducing their debt, allowing them to regain financial stability. Let’s explore the various debt relief solutions available in the province and how they can support you in overcoming your financial difficulties.
Debt Relief Solutions In New Brunswick
Here are some popular debt relief options available in New Brunswick. The best option for you depends on your specific situation:
- Debt Consolidation Loan: A debt consolidation loan combines various debts into one loan payment. If you can snag a lower rate compared to your highest-rate debt, you can save money, too.
- Debt Consolidation Program: A debt consolidation program is a structured repayment option facilitated by a credit counsellor, who negotiates with your creditors to consolidate what you owe into a single monthly payment. Unlike a debt consolidation loan, you won’t have to borrow money.
- Consumer Proposal: A consumer proposal is a legally binding offer made to your creditors to pay a portion of your debt over a fixed period. If your creditors agree to your proposal, all collection efforts and additional interest will stop. You can keep your assets and settle your debts for less than what you owe, though your credit score will suffer.
- Bankruptcy : Bankruptcy offers relief by eliminating most unsecured debts. It’s administered by a Licensed Insolvency Trustee (LIT) and puts an immediate stop to collection calls and wage garnishments. However, you may lose assets and your credit score will be significantly impacted.
How Does Your Debt Measure Up In New Brunswick?
In the first quarter of 2025, the average non-mortgage debt among New Brunswick residents was $21,490, representing a 2.82% increase compared to the same quarter the previous year. Contributing factors include rising housing costs, inflation, and slow wage growth.
Comparing your own debt to this provincial average can help you assess your financial health and determine if you might need some professional assistance. If your debt load is much higher than the average, it may be a good time to explore debt relief options in New Brunswick to regain control of your finances.
Looking For Support With Your Debt?
If debt has become too much of a burden and your efforts to manage it haven’t been successful, it may be time to seek professional assistance. Credit counselling agencies can help you establish a manageable repayment plan and budget, and explore debt solutions that may be suitable for you.
For more serious options like bankruptcy or a consumer proposal, consulting an LIT is essential, as they are the only professionals authorized to handle these proceedings in Canada.
| Are Credit Counsellors Licensed In New Brunswick? Credit counsellors in New Brunswick are not required to hold a licence, unlike Licensed Insolvency Trustees. |
How To Find A Credit Counselor Or LIT In New Brunswick
If you need expert help with managing your debt, various organizations and professionals are available to assist you based on your specific financial situation.
Below are some reputable agencies and resources in New Brunswick to consider when seeking debt relief support:
| Agency | Services | |
| Consolidated Credit | – Credit counselling – Debt management – Debt consolidation – Consumer proposal – Bankruptcy | Learn More |
| Credit Counselling Canada | – Credit counselling – Financial literacy education – Debt repayment assistance | Learn More |
| 4 Pillars | – Credit counselling – Credit rebuilding – Debt consolidation – Consumer proposals – Bankruptcy | Learn More |
| BDO Debt Solutions | – Debt counselling – Consumer proposals – Bankruptcy | Learn More |
You can also use these sources to find a credit counsellor near you:
Debt Consolidation Loans
A debt consolidation loan is a type of loan that you can use to pay off all your existing debts. This effectively combines your existing debt into a single loan with one payment, ideally at a lower interest rate. The goal is to save money in interest and simplify your finances with one loan to manage.
What Types Of Loans Can You Use To Consolidate Debt?
The following are some loan types you may consider to consolidate your debt:
| Personal Loans | – Fixed loan amount provided in one lump sum – Fixed interest rate for consistent monthly payments – Funds repaid over a set term – Funds may be used for various purposes, including debt consolidation |
| Home Equity Loans | – Secured loan that uses your home as collateral – Fixed loan amount provided in one lump sum – Generally has a fixed interest rate for consistent monthly payments – Funds repaid over a set term – Requires you to have significant equity in your home – Funds may be used for various purposes, including debt consolidation |
| Balance Transfers | – Often come with promotional 0% APR periods – A balance transfer fee applies, typically 3% to 5% of the amount transferred – Low- or no-interest period usually lasts 6 to 18 months, after which standard rates apply – Simplify payments by consolidating multiple balances onto one card |
Learn more: Credit Card Balance Transfers: How to Come out Ahead
Will Consolidating My Debt Hurt My Credit?
Taking out a debt consolidation loan could hurt your credit score in a couple of ways:
- Hard Credit Check: When your lender pulls your credit report, a hard credit check will be noted, which can temporarily affect your credit score.
- Closed Credit Accounts: Closing your loans and credit accounts can affect your credit score because you’re shortening your credit history and potentially increasing your credit utilization ratio.
Debt Management Program (DMP)
A debt management program (DMP) is a repayment plan that’s meant to help you manage and repay your outstanding debts. Here are a few features of this program:
- Credit Counselling: You work with a credit counsellor who will assess your financial situation and help you create a budget.
- Negotiation With Creditors: Your counsellor will negotiate with your creditors to potentially set up a more manageable payment plan, which may include lowering your interest rates or waiving fees.
- One Monthly Payment: You’ll make one payment per month to the credit counselling agency, which will distribute the money to your creditors accordingly.
- Set Term: The DMP typically lasts for a set term, depending on your debt amount and repayment ability.
DMPs can include unsecured debts, such as credit cards and unsecured personal loans. Secured debts, like mortgages or auto loans, are typically not included in a DMP.
Debt Settlement
Debt settlement involves a debt settlement company negotiating with your creditors to work out a repayment plan that benefits everyone involved. If successful, you’ll make a lump-sum payment to the debt settlement company, which then distributes the funds to your creditors to settle your debts.
Consumer Proposal
A consumer proposal involves an LIT negotiating with your creditors on your behalf. The trustee presents a repayment plan offering to pay back a portion of your total debt over an agreed length of time.
Learn more: Consumer Proposals New Brunswick
Bankruptcy
Bankruptcy is a legal process designed as a last resort for those unable to repay their debts. It offers a way to get rid of most unsecured debts while providing protection from creditors, collection efforts, lawsuits, and wage garnishments.
Throughout the process, you’ll make payments to the court. After completing your duties, you‘ll receive a discharge, releasing you from your debts.
Learn more: Bankruptcy New Brunswick
Key Factors To Consider When Seeking Debt Assistance
Before choosing a debt relief option in New Brunswick, it’s important to keep these points in mind:
Understand Your Rights
If you owe money, creditors can attempt collection, but there are rules they must follow. In New Brunswick, debt collection practices are regulated by the Collection and Debt Settlement Services Act, which stipulates that:
- Creditors must be licenced
- Creditors cannot harass or intimidate consumers, provide false information, or contact outside permitted hours
- Creditors are required to send written notices before starting collection efforts
| If you believe you have been mistreated by a creditor, you can contact the Financial and Consumer Services Commission of New Brunswick (FCNB): – Online portal – Telephone: 1-866-933-2222 – Email: consumer.licensing@fcnb.ca |
Beware Of Scams
While most credit counselling services are reputable, some fraudulent organizations may try to take advantage of vulnerable individuals. Be cautious of warning signs, such as the following:
- Demands for upfront payments before providing any services
- Guarantees of quick debt elimination or credit repair
- Urgency to sign agreements
- Requests for sensitive financial information over the phone
- Lack of a physical office
To protect yourself from scams, take the following steps:
- Read reviews from other clients
- Confirm contact details and physical address
- Never share personal financial information until you are certain the agency is legitimate
Understand Fees
Credit counselling and Licensed Insolvency Trustee services may involve fees, although some agencies offer free initial consultations. It’s crucial to ask about all potential costs upfront.
That said, LIT fees are regulated by the government and are generally included as part of the overall debt relief process.
Other Programs In New Brunswick To Help You Out Financially
Various programs are available in New Brunswick to help residents cover basic living expenses. Here are a few examples:
Food Assistance
Numerous food banks operate throughout New Brunswick, providing vital support to those in need. Some of the locations include the following:
- Greener Village Food Bank: 686 Riverside Dr, Fredericton, NB E3A 8C2
- FeedNourrirNB: 330 Macnaughton Ave, Moncton, NB E1H 2K1
- Peter McKee Food Bank: 475 St. George St, Moncton, NB E1C 1Y4
Utilities Assistance
With rising electricity and gas prices, many residents find it difficult to cover heating costs. The Emergency Fuel Benefit offers eligible low-income households up to $550 annually to help pay for winter heating expenses.
Rent Assistance
New Brunswick provides rental support options:
- Rent Bank: This program is designed for individuals at risk of eviction.
- Low-Income Seniors’ Benefit: This benefit grants eligible seniors $600 each year.
Homeless Shelters
Those facing homelessness can find temporary housing at various emergency shelters across the province, including the following:
- Fredericton Homeless Shelters Inc: 65 Brunswick St, Fredericton, NB E3B 1G5
- Harvest House Atlantic – Shelter & Community Center: 182 High St, Moncton, NB E1C 9X6
- Grace House for Women: 275 Brunswick St, Fredericton, NB E3B 1G8
FAQs On Debt Relief In New Brunswick
Will I be able to pay off my debt faster with a debt consolidation loan?
Is debt settlement a viable option for managing debt in New Brunswick?
What happens when you file for bankruptcy in New Brunswick?
Can debt consolidation lower my credit score?
How is a debt consolidation loan different from a regular loan?
®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
