Informal Debt Settlement
An informal debt settlement is a voluntary arrangement negotiated between you and your creditors, without the comfort of ensuring you have a legally binding agreement and the step-by-step guidance provided by a Licensed Insolvency Trustee. Your creditors have no legal obligation to work with you on creating a debt agreement and they could cancel it with little or no notice if it is not properly documented in a binding legal document.
How Informal Debt Settlements Work
To develop an informal debt settlement, you will have to first call each of your creditors directly and attempt to negotiate a repayment plan that’s within your budget and satisfies each creditors’ repayment timelines. Each creditor will separately want to negotiate interest rates, amounts and payment schedules. You will then be responsible for the payment obligations according to the terms of the voluntary agreement. The more creditors you have, the more challenging it can be to agree upon and manage each of these agreements.
Deciding on an Informal Debt Settlement Agreement
If you’re uncertain or uncomfortable about the risks involved with this type of debt agreement, talk to your local Licensed Insolvency Trustee to discuss whether it is a good choice for you. We will take the time to listen to your concerns, answer any questions and explain all of your options.
Life-Changing Debt Solutions is about finding the best choice that will work for you.
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2021-04-08
More than half (54%) of Ontarians within $200 of financial insolvency; up 13 points since December, reaching a five-year high
MNP Consumer Debt Index
More than half (54%) say they are $200 or less from not being able to cover their monthly bills and debt obligations, a whopping 13-point jump from December. Compared to the other provinces, Ontarians are the most likely (32%, +10pts) to report they are already insolvent with no money left to cover their payments at month-end.
