Where to Get Free Help to Manage Debt in 2021 | Finder Canada

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Where to get free help to manage debt

Free credit counseling is available — but it might not be enough for serious debt.

If you need help figuring out how to manage your debt, a credit counseling service can help. But if you have more debt than you can afford to pay, you might be better off signing up for a consultation with a professional debt management company.

Free resources to help manage debt

Here are a few resources that offer free financial counseling.

Credit Counseling Canada

This nation-wide organization partners with not-for-profit credit counseling services across Canada to offer a range of financial services, including debt management and even general financial education.

  • Consultations. You’ll be connected to a local certified credit counselor who will assess your financial situation and help come up with a personalized money management plan. You can find a counsellor in your area, or call them at 1-866-398-5999.
  • Financial literacy. Credit Counseling Canada offers resources to support financial literacy at the individual and community levels.
  • Know your rights. The website has information prepared to inform clients about their legal rights as a Canadian dealing with debt.
  • Not all services are free — but don’t worry, because no client will be declined service due to a lack of funds.

Canadian Association of Credit Counselling Services

This national organization partners with provincial non-profit credit counselling services to offer impartial and affordable credit counselling services:

  • Easily search for accredited partners. You can easily find an accredited partner to work with in every province by visiting their directory page.
  • Professional training. Besides helping you as the client you can take comfort that they also offer extensive training and certification services for their member organizations.
  • Not all services are free — call and speak with a counselor before signing up to find out what you may be charged.

    Are these services really free?

    Yes — to an extent. Both Credit Counseling Canada and the Canadian Association of Credit Counselling Services work with nonprofits whose aims are to improve the financial lives of those in need of assistance. While both offer free online educational tools and resources, if you want to meet with a credit counselor you may have to pay a charge. Some nonprofits offer in-person classes or schedule one-on-one sessions for free while others will charge a small fee. Other non-profits will only charge an administration fee according to how much you can afford to pay.

    How does debt management work?

    It depends on how much debt you’re in, how much you can afford to pay and how much help you need. Debt management can include setting up realistic payment plans, personal finance counseling, renegotiating interest rates, debt consolidation loans, balance transfer cards and debt settlement.

    Debt management also includes curbing unnecessary expenses and borrowing while revising your budget so you can meet your financial obligations.

    Debt-free for a fee

    If you’re in a lot of debt and advice alone isn’t enough to get you out, consider using a debt settlement company to help you negotiate with your creditors. Some companies will offer a free consultation to help you decide if debt settlement is right for you, including:

    Consolidated Credit Counseling Services of Canada

    This accredited company offers debt settlement services for debt relief such consolidation loans, debt management programs, debt settlement, consumer proposals and bankruptcy help. The initial credit counseling session is free, but you’ll be charged for further sessions as a counselor helps you work out the details of your financial plan.

    • Debt settlement can have a severe negative impact on your credit. Talk to a credit counselor before signing up.

    Solutions™ Credit Counselling Service Inc.

    The goal of this accredited company is to supply its clients with unbiased credit counselling, debt management, and insolvency education. Because Solutions™ Credit Counselling Service Inc. is an independent organization funded only by its clients, you can count on it to impartially prioritize your good when they work with your creditors.

    • Debt settlement can have a severe negative impact on your credit. Talk to a credit counselor before signing up.

    Must read: How to spot a scam

    Not all debt relief companies have your best interests at heart. Stay safe by working with a company accredited by these credible organizations:

    Be aware that a reputable company will never ask for payment up front or advertise impossible or inflated claims, like instant results or debt settlement that won’t damage your credit score.

    Compare debt relief options

    If you have too much debt to pay off using the avalanche or snowball method, consider taking out a debt consolidation loan. You can use this method to take out one loan to pay off all of your current debts. The debt consolidation loan you get often has a lower interest rate than your other debts, so you can pay more on your principle and less in interest.

    If you have a number of smaller debts, than the better option might be to get a balance transfer credit card. You can move balances from multiple credit cards or other types of debt onto one single new card with a low introductory interest rate, usually lasting between 6 – 10 months. By paying off your debt within that timeframe, you could save a lot on interest.

    Name Product Interest Rate Loan Amount Loan Term Fees Credit Score Link
    Loans Canada Debt Consolidation Loan
    Secured from 2.00%, Unsecured from 8.00% to 46.96%
    $300 - $50,000
    3-60 months
    No application or origination fees
    Min. credit score: 300
    Go to site
    More Info
    Fairstone Debt Consolidation Loan
    19.99% - 39.99%. Varies by loan type and province
    $500 - $35,000
    6 months - 10 years
    None
    Min. credit score: 560
    Go to site
    More Info
    Consolidate your debt up to $20,000 for an unsecured loan and $35,000 for a secured loan.
    LoanConnect Debt Consolidation Loan
    5.99% - 47.42%
    $500 - $35,000
    12-60 months
    No application or origination fees
    Min. credit score: 300
    Go to site
    More Info
    LoanConnect is an online broker that matches borrowers to lenders offering debt consolidation loans in amounts up to $35,000. Get approved for multiple loan offers from different lenders, no matter your credit score.
    Mogo Personal Loan
    5.90% - 46.96%
    $200 - $35,000
    6 months - 5 years
    NSF fee - $20 - $50
    Min. credit score: 540
    Go to site
    More Info
    Mogo offers loans up to $35,000 on flexible terms.
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    Compare up to 4 providers

    Name Product Balance Transfer Rate Balance Transfer Fee Purchase Interest Rate Annual Fee Min. Credit Score Description
    Tangerine World Mastercard
    1.95% for the first 6 months (then 19.95%)
    3%
    19.95%
    $0
    Min. recommended credit score: 680
    Get a 1.95% interest rate on balance transfers for the first six months (valid within the first 30 days of account opening).
    BMO CashBack Mastercard
    1.99% for the first 9 months (then 22.99%)
    1%
    19.99%
    $0
    Min. recommended credit score: 660
    Get 5% cash back on all eligible purchases in the first three months of card membership (up to max. spend of $2,000). Plus, get a rate of 1.99% on balance transfers with a 1% balance transfer fee for nine months.
    BMO Preferred Rate Mastercard
    3.99% for the first 9 months (then 12.99%)
    1%
    12.99%
    $20
    Min. recommended credit score: 660
    Get a rate of 3.99% on balance transfers for 9 months with a 1% transfer fee. Plus, get the $20 annual fee waived in the first year.
    Scotiabank Value Visa Card
    0.99% for the first 6 months (then 12.99%)
    N/A
    12.99%
    $29
    Min. recommended credit score: 650
    Get a 0.99% introductory interest rate on balance transfers with a 0% transfer fee for the first 6 months. Apply by July 1, 2021.
    Tangerine Money-Back Credit Card
    1.95% for the first 6 months (then 19.95%)
    3%
    19.95%
    $0
    Min. recommended credit score: 680
    Get a 1.95% interest rate on balance transfers for the first six months (valid within the first 30 days of account opening).
    BMO Rewards Mastercard
    1.99% for the first 9 months (then 22.99%)
    1%
    19.99%
    $0
    Min. recommended credit score: 725
    Get a bonus of 10,000 BMO Rewards points when you spend $1,000 in the first 3 months. Apply by October 31, 2021 . Plus, get a rate of 1.99% on balance transfers for 9 months. A 1% fee applies to transferred balances.
    BMO AIR MILES Mastercard
    1.99% for the first 9 months (then 22.99%)
    1%
    19.99%
    $0
    Min. recommended credit score: 660
    Get 800 AIR MILES Bonus Miles (enough for $80 towards purchases with AIR MILES Cash). Get a rate of 1.99% on balance transfers for 9 months. A 1% fee applies to transferred balances.
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    Compare up to 4 providers

    Should I use a free or paid service?

    Consider a free service if …

    • You’re on top of your payments and just want a little help to speed up the process
    • You want to learn more about credit options and building credit but aren’t ready for a full debt settlement plan
    • You’re looking for personalized advice on managing your finances

    Consider a paid service if …

    • You have over $10,000 in debt from various sources and want to consolidate them quickly
    • You’ve experienced financial hardship and are having trouble getting back on track on your own
    • You want someone to negotiate with creditors on your behalf to lower your balances or rates

    Bottom line

    Nonprofits offer free, accessible and legitimate expert advice on managing finances and debt. If you need more help, paid services like debt relief companies are available for those who want to get out of debt more quickly and have their balances negotiated by a professional.

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