Having a debt that is almost impossible to pay is a stressful experience. Unfortunately, statistics show that the average Canadian owes up to $22,081 and growing. This means that almost everyone has some kind of financial obligation and is on the lookout for an escape route and a chance to start again. It would seem that the only way to free yourself from debt is to pay it plus the interest that it has incurred over time. There’s another method, though, which allows you to pay just a fraction of your debt and yet still be able to clear it out altogether—debt restructuring, a solution that 4 Pillars Victoria, Nanaimo, Port Alberni, and Courtney consultants will review with you.
What Is Debt Restructuring?
Your ability to pay your debt depends mainly on the terms of the debt agreement. Therefore, to increase your ability to pay, you only have to alter those terms. While it seems impossible, this is actually a legal and viable option for any person or business with outstanding financial obligations. Debt restructuring basically means a part or the whole of a debt agreement is restructured to help a debtor pay his debt and in so doing help the creditor recover the money owed. With a proper repayment plan, some creditors end up agreeing to new terms even if it means losing the supposed profit from the debt service.
Consumer Proposal
Consumer proposal is one of the most popular examples of the debt restructuring solution. This is an arrangement between the debtor and the creditor witnessed and mediated by a Consumer Proposal administrator or a Licensed Insolvency Trustee. It protects you from debt collectors and offers you a chance to settle your financial obligations in more affordable terms.
Bankruptcy
If you are unable to pay your debts according to the original terms and conditions you and your debtors have agreed on, you may choose to file for bankruptcy. You will still pay your debt but filing for bankruptcy allows you to repay it under the protection of the federal bankruptcy court. Unlike consumer proposal, however, there’s a risk that some of your assets will be seized. Whichever debt restructuring method you select, it is important to use professional aid when deciding on the right option for your needs. This is where debt relief solution providers like 4 Pillars consultants come in. You need a company that has vast experience in helping people settle their financial obligations through debt restructuring and other options.
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