The total of all your debts must be paid in full plus 5% interest, usually within a period of three years, unless all creditors consent to an alternative arrangement and the Court approves it.

Eligible debts that can be consolidated include: credit cards, consumer loans and public utilities. Ineligible debts include: mortgages, student loans, along with others.

Using the Orderly Payments of Debt approach to repay debt will lower your credit rating. It is the same credit rating you would receive if you file a Consumer Proposal (R7). However, it will not be as low as the rating given to those who file for Bankruptcy (R9). Credit reporting agencies typically keep an Orderly Payments of Debt on your credit file for three years upon completion.

The program is only available in Alberta, Nova Scotia and Prince Edward Island. It is also available in Quebec, where it is referred to as the Voluntary Deposit Law (or formerly, Lacombe Law).

If Orderly Payments of Debt doesn’t seem like a viable option for you or is not available in your province, there are other possibilities. Speak to a Licensed Insolvency Trustee for your options.

For residents of Quebec, there exists the Voluntary Deposit Law (formerly known as the Lacombe Law). You can use a portion of your earnings (as determined by law) to make monthly payments to the Courts. You’ll need to make sure you pay off 100% of your total debt with an annual interest rate of 5%. To learn more about the Voluntary Deposit Law, please contact your local courthouse.

There is a small application cost, as well as the 5% monthly interest accrued during the repayment term.

Insolvency is a formal term from bankruptcy law. If you are insolvent, it means your liabilities or debts exceed the value of your assets. You would also be considered insolvent if you are unable to pay your debts on time.

My wages are being garnished to pay for my outstanding debts. I am afraid to answer the phone because it may be a debt collector calling. My creditors are threatening to sue me, repossess my personal property or hire a collection agency to recover their money. I have been borrowing money for household expenses from friends and family to make it from one pay cheque to the next. I am paying one creditor one month and another...

A secured debt is directly tied to an asset which may be seized by a lender if you fail to make your required payments on it. For example, a mortgage is considered a secured loan, with your home as the related asset. If you fail to make your mortgage payments, your secured mortgage lender has the right to foreclose on (i.e. seize) your home and sell it to pay off your debt. If the proceeds from the sale of an asset don’t entirely cover your debt,...