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Those in Regina and the rest of Saskatchewan make relatively high incomes compared to other areas of the country. Unfortunately, while they earn a lot, they also borrow a lot. In fact, the average debt load in Saskatchewan is among the highest in the country.
Many people are able to handle this large amount of debt and eventually pay it down themselves, but others may struggle and might need some help. Thankfully, Canada is home to a number of helpful debt relief services, one of the most popular being debt consolidation.
Wondering if the Federal Government provides debt relief? Find out here.
The Two Types of Debt Consolidation in Regina
In order to truly understand debt consolidation, you need to understand that there are actually two kinds of debt consolidation in Regina Saskatchewan, a debt consolidation loan and a debt consolidation program. It is important to know the difference between the two, and which would work best for you.
Debt Consolidation Loan
A debt consolidation loan is a loan that people will get in order to combine all of their monthly debt payments into one. If you have to make several different debt payments to different lenders each month, it can be a lot to handle and can be stressful. A debt consolidation loan is essentially taking out one large loan to pay off your smaller unsecured debts, and then making one large payment each month, instead of several smaller ones. This is much easier and a simpler way to stay on top of payments and easier to track, as well.
In addition to making monthly payments much simpler, a debt consolidation loan can also often get you better terms and a lower interest rate, which could save you a lot of money over the lifetime of the loan.
Debt Consolidation Program
If a debt consolidation loan isn’t right for you, you can always opt for a debt consolidation program. In a debt consolidation program, you don’t need to borrow any more money, which is attractive to some consumers. Instead, you will pay your debt relief provider in Regina one large payment each month, and they will pay the appropriate creditors from that amount.
This can often result in a lower monthly payment. But there is also a good chance that enrolling in a debt consolidation program in Regina will hurt your credit and make it hard (or at least expensive) to borrow more money.
Click here to discover more benefits of a debt consolidation program.
Each of these methods has their own unique benefits and drawbacks, so be sure to speak to an expert on which might be better for you before choosing one or the other. However, while they have their differences, they both have the ultimate goal of making your monthly debts easier to handle.
Why Do People Get Into Debt in Regina
But how do they get in the debt trouble in the first place? While there are different reasons, of course, one of the biggest reasons is overspending. People may make large purchases using credit when they cannot afford it, and then get stuck making large payments they can’t handle.
Shopping sprees, eating out too much, buying an expensive car and other irresponsible habits are some of the prevailing causes of debt trouble. Often consumers see a credit card as “free money” and don’t really think about how expensive their purchases will add up to once repayments need to be made.
However, it’s also important to note that it isn’t only irresponsible habits and overspending that can lead people to find themselves in debt. Other reasons why people can find themselves in debt trouble include:
- A reduction in income for one reason or another
- A job loss
- A financial emergency such as a car accident or home repairs
- A medical emergency or travel relating to an emergency
Simply put, there are many different reasons why some people find themselves in debt trouble and sure, some of them can be blamed on the individual themselves, but that isn’t always the case.
Types of Debt that Can and Cannot be Consolidated
Now, before you choose debt consolidation because it seems like a good option, you need to be aware of the fact that not all debts can actually be consolidated. The last thing you want to do is inquire about (or begin) the process of debt consolidation in Regina only to find that your largest and most stress-inducing debts cannot actually be consolidated.
To learn the difference between secured and unsecured debt, click here.
In an effort to ensure that your debt can indeed be consolidated, here is a list of a few of the debts that can be consolidated and a few that cannot.
Debt That Cannot Be Consolidated in Regina
- Auto loans
- Home loan
- RV or boat loans
- Government loans
- Secured loans
Debt That Can Be Consolidated in Regina
- Unsecured personal loans
- Student loans (as long as they are not federal)
- Credit card debt
- Utility bills
- Medical and hospital bills
- Back rent
- Income taxes
As you could imagine, this isn’t a completely exhaustive list of every type of debt, but it should give you a good idea about what can be consolidated and what cannot. If you have any questions or concerns about other types of debt or just want reassurance that a certain type can be consolidated, be sure to speak to a debt relief professional.
Read this to see more debt management products for credit users.
A Debt Solution That Works For You
Do you feel like debt consolidation in Regina Saskatchewan could be the right solution for you? Get in contact with Loans Canada today, we can help match you with the best service provider in Regina.