When anyone in Ottawa who is in any amount of debt begins to feel the weight of owing closer to more than they earn, it is time to really start thinking about how they can manage their debt without going bankrupt. In all actuality, it is not difficult at all. Very few honest people make the conscious choice to, not pay their debts, if the funds are not available after normal living expenses, that’s how debt accumulates.

 Moreover, in situations where individuals suffer from a loss of income while the economy is on the rise this means that more individuals here in Ottawa want to find ways to minimize their debt while avoiding going bankrupt. For instance, there are advantages and disadvantages to consider in light of declaring bankruptcy. An advantage is your debt is either wiped clean or it becomes more manageable. The disadvantage is that your credit is trashed for a period of years following.

However, if your wages are getting garnished by collectors and you are receiving late night calls from people wanting money that is not available, then, bankruptcy may be the only choice. Another advantage is that any unsecured debt goes away directly, as stated above, however the process takes time to reach fruition. It is because of this and along with the cost of negotiating that a person’s credit rating is severely damaged as an outcome.

Some Ottawa homeowners turn to refinancing their mortgage to help alleviate their debt, however, that can come at great cost. Naturally, the higher the mortgage is the longer it will take to pay it off along with a higher interest rate. One aspect of this route would be to take a shorter term, second mortgage, however, the interest may be high as well, and that can make matters worse.

If a company offers you, a ‘consolidation package,’ you need to ask how it works. Typically, they offer either debt negotiation or bankruptcy. In this scenario, the lesser of the two evils is the debt negotiation.

Furthermore, if a bank offers you help, they are only doing so to make money on the interest of a credit package, and drive you deeper into debt. This brings us to the valid question of “what can a person do to get realistically out of debt?” The best answer, counselling.

Financial planners/advisors are equipped to guide individuals on how to manage their money and their debt in ways that can improve their debt to income ratio. They do this by showing them how to bring their debt closer to a manageable level. Be aware that even with a financial advisor, here in Ottawa, the cost can outweigh the benefits.

Getting out of debt without going into bankruptcy in Ottawa is best accomplished through researching the financial advisors with the best track record for positive outcomes at a reasonable expense. Paying off debt is not hard, it takes planning and a willingness to make it happen, instead of trying to ignore the problem. Your debt will never just, go away unless you have a solid plan.