The Loans Canada team sits down with Gary Schwartz of the Canadian Lenders Association to talk about open banking.
Watch Our For These Types Of Debt
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According to a report from Equifax, Canadians carried an average debt of $23,760, not including mortgages. While some types of debt can be good others are considered bad for your financial health. Generally, student loan debt and mortgages are considered as good debt as it adds value to your life and assets. For example, a student loan is considered an investment toward your future ability to earn a good income. On the other hand, payday loans, auto title loans and other high-interest loans are considered as bad debt.
Do You Have This Type of Debt? Then You May Be in Trouble
Many Canadians carry some type of debt, but it’s important to understand that no two debts are alike. Some types of debt carry a heavier burden than others.
A Good Example is Payday Loan Debt
Payday loans are by far one of the most predatory forms of lending. They lure you in with phrases like “no credit checks” “easy application” and “fast cash”. But behind that hides APR rates between three and six hundred percent and late payments fees that can trap you in a cycle of never-ending debt.
Another Example is Debt From Cash Advances
While convenient, a credit card cash advance can cost you for 2 reasons:
- First. You’ll be subject to a cash advance fee which can be a flat rate or a percentage of your total transaction. Usually whichever is higher.
- And Second. There’s no grace period, which means you begin to accrue interest right away.
For the Last Example, Let’s Take a Look at Debt From Auto Title Loans
Auto title loans are short-term loans that are secured against your car. This form of debt can be very dangerous as the lender can seize your car if you
If you’re struggling to manage any one of these debts, be sure to reach out to a debt specialist. They can review your finances and provide you with a personalized debt relief solution
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