Canadian household debt news: Canadians hunger for more borrowing
The Canadian household debt news is that the hunger for borrowing from our Canadian financial institutions stayed vibrant. It established a new high for Canadians’ borrowing, Statistics Canada reported in December 2016. The widely followed measure of Canadian household debt service ratio rose to a new high of nearly 167 percent.
The numbers will certainly heighten the issue for our provincial and federal governments. The consumer economic situation has actually ended up being over-reliant on bank borrowing. This as well makes it susceptible to a real estate slump and a climbing rate of interest.
Canadian household debt news: Finance Minister Bill Morneau says “What? Me worry?”
The current StatsCan reporting covers the 3 months before Finance Minister Bill Morneau tightening up home loan financing regulations once again in October. His action made to prevent Vancouver as well as Toronto house purchasers from taking on bigger home mortgages compared to what they can manage.
Credit-market financial debt reached C$ 2.005 trillion from C$ 1.980 trillion in the previous quarter. Those responsibilities leapt by 1.3 percent in the 3rd quarter, faster compared to the 0.9 percent gain in family income.
Overall personal financial obligations surpassed the dimensions of Canada’s economic climate for the 2nd straight quarter. It made up 101.2 percent of GDP from July to September 2016.
Financial debts have actually climbed up together with the Vancouver and Toronto real estate boom. Job creation and low-interest rates encourage more borrowing.
household financial obligations household debt news Canadian household debt to gdp Canadian household debt by province
Canadian household debt news: Bank of Canada Governor Stephen Poloz says “What? Me worry?”
Bank of Canada Governor Stephen Poloz reduced rates of interest two times in 2014 to 0.5 percent. He claimed he should act to ease damages to personal incomes from plummeting oil prices. On December 15, 2016, the Bank of Canada published its newest Financial System Review. The semi-annual record specified that family monetary susceptibilities as well as discrepancies continues to climb in Canada.
The Financial System Review stated that the Bank of Canada really feels that these discrepancies will certainly not adversely impact the Canadian economic climate. Steps have actually currently been implemented to prevent negative after effects. Steven Poloz specified that plans to reduce the threat to the monetary system in its entirety have actually been presented in current months. He further stated that will certainly act to ease the possible repercussions for the monetary system of increasing family financial obligations.
On the bright side of Canadian household debt news, household financial obligations as a share of family net worth stayed at 20 percent in the 3rd quarter of 2016. As well as debt-service repayments were not altered at 14 percent of disposable income.
Canadian household debt news: What to do if you can no longer say “What? Me worry?”
Not all families’ stories have happy endings. If you’ve borrowed too much or life has thrown you a curve ball and you can’t make your mortgage and other debt payments, contact Ira Smith Trustee & Receiver Inc. We’re here to help you solve your debt problems and set you on a path to debt free living Starting Over, Starting Now. All it takes is one phone call to schedule a free, no obligation appointment.
Cashing in RRSPs before retirement is never a good idea. It seems that as life gets more and more expensive, fewer Canadians are saving for their retirement. A recent BMO survey reports that only 46% of Canadians are planning to contribute to RRSPs this year. What is most alarming is that 38% of Canadians have made early withdrawals and were cashing out RRSPs before retirement this year, compromising their retirement savings. In fact on average, Canadians have withdrawn $17,213 from their RRSPs this year, an increase of $1,305 from last year.
Why are Canadians cashing in RRSPs before retirement?
30% – Purchase a house
21% – Living expenses
18% – Pay off debt
18% – Pay for emergencies
13% – Other
Why are Canadians cashing in RRSPs before retirement instead of using the Home Buyers’ Plan to buy a house?
Canadians are using the Home Buyers’ Plan but it’s only for first-time buyers. They access their RRSPs to buy houses and borrow up to $25,000 from their RRSP. The money must be paid back over 15 years. There is no penalty for making the withdrawals, as long as you pay the money back in the specified time frame. Unfortunately if you’re not a first-time buyer or need more than the $25,000 allowed, you have a problem.
Are Canadians concerned about cashing in RRSPs before retirement?
75% are very concerned about the consequences
73% say they’re familiar with the tax penalties or the rules for repayment under the Home Buyers’ Plan
19% don’t expect to pay the funds back
So notwithstanding that Canadians understand the consequences of cashing out RRSP before retirement, they do not feel they have any other alternative.
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Is cashing in RRSPs before retirement for living expenses ever a good idea?
According to Chris Buttigier, director of wealth planning publications with BMO Wealth Management, “It’s concerning to see that so many Canadians are dipping into their RRSPs to meet short-term needs, which should only be considered as a last resort. Canadians need to consider more options that may be available before making any withdrawals. Make sure you have fully considered the ramifications of the early withdrawal tax consequences. In most cases, RRSP withdrawals will count as income in the year the money is taken out and taxed at your highest marginal rate”.
Is cashing in RRSPs before retirement to pay debt a good idea?
It’s clear that many Canadians are in financial trouble. Before cashing out RRSPs before retirement and emptying out your retirement savings to pay living expenses and debt, contact a professional trustee. There are other options than cashing in RRSP before retirement and compromising your retirement.
We approach every file with the attitude that financial problems can be solved given immediate action and the right plan. Don’t be one of the Canadians cashing in RRSP before retirement. Make an appointment with the Ira Smith Team for a free, no obligation consultation and Starting Over, Starting Now you can get back on track to debt free living. Give us a call today.
The bankruptcy trustee in Vaughan: Why did we transform into a licensed insolvency trustee?
Similar to caterpillars turning into butterflies, this bankruptcy trustee in Vaughan went through a metamorphosis. The Office of the Superintendent of Bankruptcy officially changed the name “bankruptcy trustee” to “licensed insolvency trustee” (LIT). As of April 1, 2017, all licensed trustees must have fully transitioned to the use of the LIT designation.
The purpose of this blog is to offer an overview of the Canadian insolvency process. Think of it as a bankruptcy and insolvency lesson 101.
What is the purpose of the Bankruptcy and Insolvency Act
Among the primary functions of this insolvency process, it is to release the individual from specific financial debts. It is to give a straightforward honest but unfortunate debtor a “new beginning.”. The debtor has no responsibility for discharged financial obligations.
A discharge is available to personal bankrupts, not to corporations. Although a personal case typically causes a discharge of financial debts, the right to a discharge is not absolute. Some sorts of debts may not be released. Section 178(1) of the Bankruptcy and Insolvency Act (Canada) (“BIA”) sets out the types of debts that are not released by the discharge of the bankrupt. The kinds of debts that are not released are:
1. child support and alimony;
2. fraud or near fraud;
3. debts arising from Court orders.
Where can I do some of my research?
You must initially do some of your own research to get an idea of exactly what your choices are. One place to start is our website to learn about:
through bankruptcy by turning over their property to a licensed insolvency trustee to realize upon it for the general benefit of creditors.
Either way, the funds available for distribution to the creditors are paid out by the licensed insolvency trustee. It is according to the scheme of priority laid out in the BIA.
The Court will consider approving a repayment plan that will repay the approved part of the financial obligations in no more than 5 years. When you use the restructuring provisions of the BIA (Consumer Proposal or Division I Proposal), you need to have a payback strategy to show your creditors just how you are going to pay back your debts. A successful restructuring plan is an alternative to bankruptcy and will allow a person or company to avoid bankruptcy.
There are various rules and ways that must be followed. Your licensed insolvency trustee can go over all the issues with you and is there to aid you through the process.
How does it all work?
Canada’s insolvency legislation is designed for debtors experiencing financial problems who cannot pay their present financial obligations and don’t have enough cash flow to offer a restructuring plan to avoid bankruptcy. The aim is to get a release from their existing debts.
The premise of the BIA is that the individual must deliver all of his or her non-exempt assets to the licensed insolvency trustee. The trustee will sell them for distribution to the creditors. In return, other than for either secured debts or the class of debts not released by a discharge from bankruptcy discussed above, the person’s debts will be erased. The person will be able to maintain any type of property that is categorized as exempt under provincial regulations. In this way, a discharge allows the individual to return to society as discharged bankrupt. This allows the person to start all over again.
Your credit score
Filing in an insolvency process could impact your financial resources and credit score for years. You should very carefully weigh all your options before choosing the bankruptcy option. That is a discussion a licensed insolvency trustee will be happy to have with you and will help you in first trying to find one of the possible bankruptcy alternatives. Hopefully, together you can see which one is best for you. Only if there is not an available alternative, will the trustee recommend bankruptcy?
A current bankruptcy filing may prevent you from acquiring a mortgage or other financing for years. Credit card businesses will instantly end your charge cards when you file for bankruptcy. Likewise, if you are trying to find a job or rent a place to live, some employers or property owners might look unfavourably on a current bankruptcy filing. If other applicants are as qualified as you and don’t have a bankruptcy on their record, you probably won’t be chosen.
Fresh start
Bankruptcy permits people or companies that are unable to pay their debts to settle their monetary difficulties and start restoring their credit. Declaring bankruptcy will trigger the “stay of proceedings”, preventing creditors from starting or continuing any legal action to collect their debts.
A bankruptcy filing will stay on your credit report for about 7 years. Since many financial debts can be discharged in bankruptcy with certain exceptions, people can take certain steps to begin boosting their credit rating after filing for bankruptcy and for sure after obtaining their discharge.
What to do if you are experiencing financial hardship
I hope this bankruptcy trustee in Vaughan Brandon’s Blog was helpful to you. People experience financial hardship for many reasons. If you’re experiencing financial hardship and are looking for a way out, contact Ira Smith Trustee & Receiver Inc. With immediate action and the right plan for moving forward, we can set you on a path to debt-free living Starting Over, Starting Now. All it takes is one phone call.
Retirement’s a hot topic these days, but most people don’t get it that retirement security starts at home. Will we be financially able to retire? How can we fund a retirement that may last 30+ years? How much money will we need to retire? Is there such thing as retirement security?
Retirement security starts at home: Global Retirement Index
The latest Global Retirement Index delivered good news and bad news for Canadians. The good news is that when comparing the state of retirement security in 43 countries around the world, Canada ranked 10th, up from 12th last year. In case you’re wondering what countries were in the top three spots, they were Norway, Switzerland and Iceland. Our neighbour to the south, the U.S. ranked 14th.
Retirement security starts at home: How long will my savings last in retirement
Canadians are asking themselves “how long will my savings last in retirement”. The bad news is that Canadians are underestimating how much they should be saving for retirement.
72% of Canadians surveyed identified retirement saving as their highest financial priority, however many believed they would need to replace only 60% of their income after retirement. Planning professionals typically work on the assumption that you need to replace 75-85%.
Canadians reported setting aside an average of 10.5% of their annual income for retirement. The international average is 12.2%.
Only 55% of Canadians take part in workplace-based savings programs.
The reality is that many Canadians are underestimating how long they’ll need their savings to last. It’s not uncommon for Canadians to live well into their 90s and some will even reach 100. This means that you may be funding a 30+ year retirement. For many Canadians there will be no such thing as a retirement security plan.
Retirement security starts at home: Do you have too much debt to think of retirement savings?
So as you can see, it really is true that retirement security begins at home. You can’t have a secure retirement if your house is full of debt. If you’re struggling with debt, now is the time to see a professional trustee. We can help you free yourself from debt, so that you can start saving for your retirement. Contact the Ira Smith Team today so that Starting Over, Starting Now you can work towards retirement security.
The purpose of this blog is to discuss the corporate receivership bankruptcy difference Canada. Every general security agreement defines exactly how the secured lender will certainly deal with obtaining his/her cash when it comes to default. One means to do this is by selecting a receiver.
A receiver or receiver/manager is an individual/company licensed by the Federal Government to act as a licensed insolvency trustee. The receiver can be appointed either by an instrument in writing or by a court order. A receivership administration falls under the Bankruptcy and Insolvency Act (Canada) (BIA), where the receiver takes possession and control over the assets to of the insolvent business.
The receiver or receiver/manager will certainly seize the properties covered under the lender’s security or covered by the court order. The receiver will also develop a plan to market the assets for sale. After paying any type of priority claims as well as the receivership administration costs, the net funds are paid to the first secured creditor.
Can you have both at the very same time?
Sometimes there is both a bankruptcy plus a receivership. Receivership is a treatment for secured creditors, such as financial institutions. Bankruptcy is a treatment for unsecured creditors.
a restructuring proposal could be annulled by the trustee or creditor for non-compliance.
There are many reasons that a corporation could go into bankruptcy. These consist of the following:
The firm has defaulted under its premises lease, the landlord distrains against the firm’s possessions. A bankruptcy or a notice to make a proposal filed before the property owner finishes the sale of assets defeats the lease distraint.
The firm has unsecured assets (i.e., possessions without a lender’s security registered against it) that are available to be realized upon. Also, the firm cannot carry on business any longer.
If a restructuring proposal is submitted, but the company could not get adequate funding to continue its business and complete the proposal.
To reorganize the statutory priorities.
To officially bring the business to an end as well as give a complete report to the creditors so they will not believe the principals engaged in any kind of misbehaviour.
In a company bankruptcy, the licensed insolvency trustee seizes all the business’s properties plus deals with all the creditors. The directors and management of the company accept the authority of the trustee; if requested by the trustee, they can as well as aid the trustee in his/her tasks. This eliminates them from all the stress of dealing with the creditors as well as running the cash-starved business.
Receivership bankruptcy difference Canada: Making the Application to Put a Debtor Into Bankruptcy
If a creditor is incapable of recovering the amount owed to it with any one of the readily available techniques which can be done, they may look to a bankruptcy application. This is especially so having actually acquired a judgment for the quantum owing which has not been satisfied. The BIA allows for the licensed insolvency trustee, once appointed, to take possession in an organized way, the assets of an insolvent debtor, to realize upon those assets and to then distribute the funds according to the scheme of priority in the BIA.
The BIA allows for the benefit of both bankrupts and their creditors. While the Act is not planned for usage as a device for the collection of private financial obligations, this may be the case in specific situations.
Receivership bankruptcy difference Canada: When is a Creditor Allowed making a Bankruptcy Application?
An unsecured creditor could apply for a bankruptcy order where:
the lender is owed $1,000 or even more on an unsecured basis, and
there has actually been an act of bankruptcy by the borrower within the 6 months that come before the filing of the application. Keep in mind that a secured lender can value its security at less than the overall amount owing to develop a partly unsecured debt.
The BIA states that acts of bankruptcy consist of the following:
if in Canada or elsewhere he makes an assignment of his property to a trustee for the benefit of his creditors generally, whether it is an assignment authorized by this Act or not;
if in Canada or elsewhere the debtor makes a fraudulent gift, delivery or transfer of the debtor’s property or of any part of it;
if in Canada or elsewhere the debtor makes any transfer of the debtor’s property or any part of it, or creates any charge on it, that would under this Act be void or, in the Province of Quebec, null as a fraudulent preference;
if, with intent to defeat or delay his creditors, he departs out of Canada, or, being out of Canada, remains out of Canada, or departs from his dwelling house or otherwise absents himself;
if the debtor permits any execution or other process issued against the debtor under which any of the debtor’s property is seized, levied on or taken in execution to remain unsatisfied until within five days after the time fixed by the executing officer for the sale of the property or for fifteen days after the seizure, levy or taking in execution, or if any of the debtor’s property has been sold by the executing officer, or if the execution or other process has been held by the executing officer for a period of fifteen days after written demand for payment without seizure, levy or taking in execution or satisfaction by payment, or if it is returned endorsed to the effect that the executing officer can find no property on which to levy or to seize or take, but if interpleader or opposition proceedings have been instituted with respect to the property seized, the time elapsing between the date at which the proceedings were instituted and the date at which the proceedings are finally disposed of, settled or abandoned shall not be taken into account in calculating the period of fifteen days;
if he exhibits to any meeting of his creditors any statement of his assets and liabilities that shows that he is insolvent, or presents or causes to be presented to any such meeting a written admission of his inability to pay his debts;
if he assigns, removes, secretes or disposes of or attempts or is about to assign, remove, secrete or dispose of any of his property with the intent to defraud, defeat or delay his creditors or any of them;
if he gives notice to any of his creditors that he has suspended or that he is about to suspend the payment of his debts;
if he defaults in any proposal made under this Act; and if he ceases to meet his liabilities generally as they become due.
if he ceases to meet his liabilities generally as they become due.
Keep in mind that in most of the situations above, the creditor does not need to show that the borrower cannot pay various other creditors. In the last situation, the creditor should show that more than just its own debt is not being paid. Unique situations would differentiate matters though.
Unique scenarios can consist of allegations of fraud, near-fraud or those other transactions which fall under the types that would seem to be attackable by a trustee. At least on a prima facie basis.
It should, nonetheless, be remembered that stringent evidence of both your unsecured debt and an act of bankruptcy is required to have an individual or business judged bankrupt.
Receivership bankruptcy difference Canada: Under What Circumstances Should a Creditor Make An Application For A Bankruptcy Order?
Making an application for a bankruptcy order to put a debtor into bankruptcy is no little job. Prior to choosing this option, consider the following:
the presence and amounts of claims that could take priority over your unsecured creditor status;
the dollar measure of unsecured debt ranking on the same level with your financial debt (i.e., each unsecured creditor is paid according to the calculated share based on the measure of his/her debt);
the existence of questionable transactions or transfers undervalue within the three-month to five-year evaluation period before the declaration of bankruptcy;
your very own history of repayments from the debtor/borrower in addition to the normal payment patterns in the 3 months before the date of bankruptcy; as well as
the legitimacy of any kind of security you might hold.
Receivership bankruptcy difference Canada: The Bankruptcy Application Can Be Very Useful
Think about:
has the debtor actually moved the residential property to a related party for inadequate or no consideration;
where the debtor does not want to lose a specific part of its property (e.g. a private yacht, unique cars and truck or shares in a firm) or does not want its transactions and events to be inspected by a trustee and/or creditors;
the debtor (being an individual) expects an inheritance;
where the debtor (being an individual) needs to be an officer, director and/or shareholder of several businesses;
the debtor (being an individual) might have his/her expert certification or licence from which he/she derives income compromised or lost as an outcome of being ruled a bankrupt;
when the bankruptcy of the debtor would cause him/her to lose the ability to generally conduct business, such as required to use a trust account or employment requires the need to be bonded; or
being a bankrupt would cause the company or individual to lose the advantage of a specific useful agreement, lease, or company.
Receivership bankruptcy difference Canada: How Does a Creditor Make The Application For A Bankruptcy Order?
The creditor desiring to file the application will certainly need a lawyer to prepare the needed documents to make the bankruptcy application. The lawyer will serve the motion material and attend for the bankruptcy order. For an uncontested motion, the lawyer appears before the Bankruptcy Registrar who is a Master of the Court. If opposed, the matter can only be heard by a Judge.
The creditor has to additionally make arrangements with a licensed insolvency trustee to act will need to guarantee the trustee’s fee and costs incurred by the trustee where there are not enough proceeds from the sale of assets. A lot of times it is likewise needed to give the trustee a cash retainer.
When the Bankruptcy Order is made, the licensed insolvency trustee starts the bankruptcy administration. All actions against the insolvent are stayed.
Receivership bankruptcy difference Canada: What If You’re Company Has Too Much Debt?
Is your company insolvent? Are you looking for solutions? The Ira Smith Team is here to offer alternatives to restructuring and turnaround services however, if required, we also act as a licensed insolvency trustee in bankruptcy matters. We offer help in Vaughan as well as throughout the GTA.
Are you an individual or company who feels your situation is hopeless? Ira Smith Trustee & Receiver Inc. can prepare and put in place the plan MADE JUST FOR YOU. The plan will free you from the burden of your financial challenges. With our help, you will go on to live a productive, stress-free, financially sound life.
I am always asked where can you get both good and bad credit loans. The first question I ask is how do you know you have a bad credit score? Have you checked it recently?
Last week we reviewed the new entrant to the Canadian financial marketplace, Credit Karma Canada and its service for checking your credit score for free. Right now Credit Karma Canada does not offer loan products, so it cannot help you with good and bad credit loans.
Good and Bad credit loans: First know your credit score, good or bad
This week we are reviewing another website where you can check your credit score for free, and if you wish, also use the site to get a loan product – Borrowell.com.
If you have a good credit score, you may very well qualify for a loan from Borrowell.com. If you have a bad credit score, being one below the Borrowell minimum credit score, Borrowell can’t give you a loan. In that case, they have partnered with a lender who may be able to. If you have a bad credit score, Borrowell will immediately tell you who to contact to apply for a bad credit score loan.
Good and Bad credit loans: About Borrowell
It’s never been so easy to swipe a credit card when you go shopping, but when people can’t control or manage their swiping, they will fall deep into debt. Then, they’ll have to go to their bank to borrow more money, but could face a big objection, depending on what their credit score is.
Borrowell is a Canadian company and a new breed of lender. Borrowell is in the growing group of fintech – defined as “computer programs and other technology used to support or enable banking and financial services”. Borrowell has teamed up with Equifax Canada, to allow anyone to check their credit score for free.
Checking your credit score this way, will not impact on your credit score, unlike when a lender, or potential lender, does an Equifax or TransUnion Canada credit check on you. Borrowell has also partnered up with third-party vendors, to offer financial products. Once you have checked your credit score, you can on a fairly seamless basis, apply for a personal loan for almost any purpose.
You can combine your debt, finance a purchase or borrow for your business. Borrowell has partnered with lenders for those with either good or bad credit scores.
Good and Bad credit loans: Hidden secret – Credit score, credit rating and credit report
The tool the banks use to measure creditworthiness is a person’s credit rating and credit report. But not everyone takes the time to check there’s out. You probably found out your credit rating the last time you applied for a mortgage or other loan, but have since forgotten what it was.
Regardless, time has passed and your credit rating has now changed. Here is the hidden secret. If you don’t know your credit score, you have no idea what needs improving. Once you know your credit score, you can drill down to work on what needs improving. Borrowell allows you to check your credit score for free.
“I would say anything above 650 is deemed to be a good rating” says Andrew Graham, the CEO of Borrowell.com. It’s the first lender in Canada to give free credit scores online. Proving that you are able to treat credit properly over an extended period is everyone’s goal. If you want to improve your credit score, the first and most important thing you can do is to check out where it is now at either Borrowell.com or Credit Karma Canada.
Good and Bad credit loans: Your credit score is an important number
Your credit score is an important number. One that can impact:
your ability to borrow money in the first place;
the rate of interest that you’re going to pay;
your ability to find a rental if you don’t own;
your ability to get a job;
your home mortgage rate;
your insurance policy charges; and
even your job expectations.
We have written before on these issues, including:
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Good and Bad credit loans: Don’t tense up!
Even if you think your credit rating is good, people tense up and they get really nervous and uneasy because they don’t know. People I see in our insolvency practice are always concerned about their credit rating, sometimes unnecessarily so. In fact, the people I see care more about their credit rating than the debt they can’t repay!
Whether you know or not it’s not going to change the result so I say it’s better to know than not know. You wouldn’t ignore going to the doctor if you thought something was wrong, so why ignore your finances?
Good and Bad credit loans: Hidden secret to demystify your credit score
To demystify your credit score a bit, it is on a scale from 300 to 900 and the higher the score the better. So you want to have a relatively high credit score to be assured that you get the best possible borrowing rates.
What would cause you to have a low credit score? Things such as not paying off your credit cards, if you’ve missed payments, and if you are late by 30, 60, or 90 days. That’s a big red flag, because again your credit score reflects how likely is this person to make their payments that they signed up to or not.
If you have a large unused credit ability, say you have five charge cards each with a $10,000 limit, but you pay it off every single month you’d think that would produce a good credit rating. However, the lenders will say, you can get into trouble really quickly. So if you have a lot of charge cards, you should focus on reducing the number you have open and reduce it to just a few.
Can I use a good credit rating to my advantage? Can I negotiate better interest rates? Yes, absolutely. They’ll know, so they’ll have an idea about your ratings and offer you pretty good terms, but you can certainly negotiate. If you’re a renter, you know when you’re dealing with potential landlords, if everything about you is the same as everyone else, except for your credit score, and yours is poor compared to another applicant, the rental will go to the other applicant.
Good and Bad credit loans: It doesn’t have to be like that forever
Does your credit rating stay with you eternally? If I was a broke student and racked up indebtedness, is that still going to affect me in my forties? Probably not. What happens is your rating will change as your circumstances change. So as long as you set up a record of responsible credit behavior, even if circumstances were really bad a very long time ago, you probably can still have a really good credit rating.
So it all starts with knowing your credit score and Borrowell.com can help you. Once you know the credit score, the secret to getting that loan you need at a reasonable price is to first do the things you need to do to improve your credit score. But even with a bad credit rating, Borrowell.com, through one of its partners, may still be able to get you that bad credit loan.
Good and Bad credit loans: Hidden secret to fix the problem without more debt
Our final hidden secret is to let you know that normally, more debt will not fix your problems. You need to find out why you have a bad credit score, why you cannot use your existing income to pay your bills and debts and why you need to borrow more money. We can help you unlock all those answers, and unlock the hidden secret for you to get your life back on track.
We’re approaching tax season and income tax scams in Canada are rampant. It’s more than just the Canada Revenue Agency (CRA) that wants your money. Income tax scams in Canada are big business and it seems that every day there’s a new scam designed to fool you into giving up your information and ultimately your money. Don’t let your guard down because these fraudsters are good.
We regularly warn our readers about scams in blogs such as:
If you receive any sort of communication from the CRA – telephone, mail, email, text message – requesting personal information such as your social insurance number, credit card information, bank account number or passport number, it’s a scam. The CRA will never:
ask for personal information of any kind by email or text message
request payments by prepaid credit cards
give taxpayer information to another person, unless you give formal authorization
leave personal information on an answering machine
send email with a link and ask you to divulge personal or financial information (There is one exception: If you call the CRA to ask for a form or a link for specific information, a CRA agent will send an email containing links)
Tax scams in Canada: How to protect yourself
Never give out personal information via the email, text, voice mail or Internet
Guard your passwords, IDs, PINs and access codes
Do your due diligence when selecting a tax preparer. Preferably get a referral from a trusted source
Shred unwanted documents
Tax scams in Canada: What to do if you’re a victim
Many people don’t report these types of crimes because they’re ashamed. Don’t be! If you suspect you may be the victim of fraud or tricked into giving personal or financial information, contact your local police service.
Tax scams in Canada: Are you experiencing financial hardship?
People land in financial hardship for many reasons. If you’re experiencing financial hardship and are looking for a way out, contact Ira Smith Trustee & Receiver Inc. With immediate action and the right plan for moving forward we can set you on a path to debt free living Starting Over, Starting Now. All it takes is one phone call.
Credit Karma Canada has arrived recently from the United States. Its website is creditkarma.ca. Right now they run in most provinces but not yet in Quebec, Nunavut, the Yukon or the Northwest Territories; but they are working on it. The purpose of this blog is to provide our Credit Karma Canada review, tell you what it is and to let you decide if it will be helpful or not for you or someone you know.
Since 2007, Credit Karma USA (CKUSA) has attempted to simplify credit and finance for more than 60 million CKUSA members. They advertise very heavily on US television to attract new members. Becoming a member is free, and it allows any member to get access to their free credit score and credit report, with the option to update every single week. CKUSA also provides financial education to put credit into context.
It’s mission statement is:
“Everyone deserves to feel confident about their finances. Our job is to give you the tools, the education and the opportunities you need to make real, meaningful progress.”
Credit Karma Canada review: Is it really free? Is it legitimate?
So far so good. Like a lot of things advertised as being free, you may wonder to yourself is it really free? Is it legitimate?
The answer is yes; accessing your credit score, your credit report and the financial and educational aspects are free. However, it is a money-making operation. They make money in at least two ways:
They have ads to make money. So if you don’t like ads, just ignore them; and
They do promote various credit card, mortgage and loan programs which they hope members will purchase when needed. When someone takes an offer through CKUSA, it makes money from one of its partners (like the bank that issues a credit card or the lender who funds a loan). Presumably, Credit Karma Canada (CKC) will be following that model by establishing such partnerships.
So this is how it works. When you first open your account and set up your unique password, it’s going to ask you different questions to confirm your identity, including your date of birth and social insurance number. They are trying to become the best-known credit bureau of Canada.
It might include things like where did you get your last car, what kind of car do you have, what addresses have you lived at in the last five years, what address do you currently live at. All of the questions offer you multiple choices to choose from. Once you finish that process your account is open. This allows you to log in either from the app or from their website.
In order to ask you the setup questions, and to then be able to give you your free credit score and report, CKC obtains information from one of our two credit reporting agencies, TransUnion. In the United States, Credit Karma uses both Equifax and TransUnion.
CKC also searches certain public record databases to look for other information such as:
Bankruptcy: A legal filing by people or businesses seeking certain types of relief from all or some their debt.
Civil Judgment: A non-criminal ruling in a court of law, often requiring the person or business to pay damages.
Registered Items: Other items included in public records, like a lien against your car or a mortgage or loan registered against your house.
Credit Karma Canada review: Does using it lower my credit score?
You can watch your score through CKC anytime you want. Unlike a potential or real lender performing a check on you, the more times you go into the CKC database it does not affect your score. The TransUnion and Equifax credit score algorithm reduces your score every time someone does a check on you.
The theory is that each credit check is either related to your having applied for new loan(s), or an existing lender feels the need to check up on you. The algorithm interprets this as your need for more borrowing. If the checks are too often or too close together, their algorithm assumes you are experiencing some financial problems requiring more loans. The CKC algorithm prevents this from happening, which is a good thing.
However, remember that the CKC algorithm is different from the one used by TransUnion and Equifax; this is an important distinction which I will explain shortly.
Credit Karma Canada review: Things I like about it
A feature that I do like is that the CKC report will help you understand what factors are impacting your score, thereby telling you what you need to work on to improve your score. This is especially for young people who are just learning about borrowing and personal finance for the very first time. CKC gives advice for how to help improve your score and things not to do.
So it is handy to find out about:
payment history;
credit use;
derogatory remarks on your financial history;
total account and inquiries;
your full report; and
credit advice.
CKC gives you an easy way to see how you’re doing financially, how much money you have tied up between charge cards and auto and other loans. It also gives you tips on how to improve your score, all for free.
It is an easy and efficient way of checking up on yourself that TransUnion, Equifax or any of our Canadian financial institutions have never done. So, in my view, CKC is providing a real service and benefit.
Credit Karma Canada review: Things I do not like about it
So are there any downsides? Since CKC is not yet advertising who its financial product partners are, I have to look at the US operation. So, my comments come from a review of only CKUSA.
I’m not convinced that I would personally recommend any of the financial partners. Here are the reasons why:
The financial partners have to pay a fee to CKUSA, and that fee has to be reflected in the cost of the financial product itself, making it higher.
It is safe to assume that CKUSA members are working on improving their scores. The financial partners may be pricing their products for those people who have not achieved enough of a score to go and negotiate the rate they will be paying with any Bank. Again, this means the cost of any specific financial product through CKUSA could be higher than otherwise available to people with a better score.
So if you do have a good score, you can probably get a better deal by going to the Bank you normally deal with.
Once CKC establishes its Canadian financial partners, we will have to see if it follows this higher priced US model.
The most common complaint in the US is that the score through CKUSA is different from the score calculated by either Equifax or TransUnion.
Recall that I gave an example of how the CKUSA algorithm was different from the one used by the credit reporting agencies? Well, it is further differences in the algorithms that causes this disparity. I am not talking about a small disparity either. Complaints show that the difference could be as much as 100 points!
CKC states that it shows the same credit rating and report that TransUnion shows. Again, time will tell if the Canadian experience is the same or different from in the United States.
My final point is not a criticism, but merely a fact. CKC describes their system as being safe, they respect your privacy and do not share your information with any third-party.
However, when you give personal information on a website, and especially financial information including your social insurance number, this always provides an opportunity for hackers and phisher scam artists to attempt to either hack the system or use phishing emails and websites to attempt to steal your identity.
Credit Karma Canada review: Only you are in control of your credit and debts
I hope that you realize from this blog that understanding your credit score and credit report and obtaining more financial education are all positive things and are necessary to be able to have a good financial life. However, sometimes life gets in the way and good people experience debt problems.
Only you can be the one to deal with your debt to get on top of it and gain back your life. If you don’t know how to go about reducing your debt, start by contactingIra Smith Trustee & Receiver Inc. There are many ways to deal with debt. As experts we can help you make the best choice and set you on a path to debt free living Starting Over, Starting Now. Make an appointment for a free, no obligation today.
We keep hearing commercials about debt relief and their scare tactics of portraying the safety of a debt relief program vs bankruptcy. But, what is debt relief? And can some of these so-called debt relief companies actually put you deeper into debt?
Debt Relief Program vs Bankruptcy: Are They Legit?
As consumer debt continues to soar many Canadians are easy marks for unscrupulous companies who make false claims which are quite frankly just scams. The Financial Consumer Agency of Canada (FCAC) is warning Canadians to be very cautious about companies that claim they can negotiate a deal to cut the amount of debt you must repay to your creditors. This process is often called “debt reduction,” “debt settlement,” “debt relief” or “debt negotiation.” The truth is that there is no easy way out of debt. And, if you need help dealing with debt problems, run away from these companies and work only with a licensed insolvency trustee (the new name for a trustee in bankruptcy).
Heed the warning of FCAC Commissioner Ursula Menke. “Unfortunately, people do not always see the benefits that debt reduction companies lead them to expect—and some people wind up even deeper in debt than they were before,” says FCAC Commissioner Ursula Menke. “If an offer to reduce your debts seems too good to be true, it probably is.”
Debt Relief Program vs Bankruptcy: Debt relief tactics to beware of:
Government approved: Companies will try to win your confidence by stating that they are government approved. Not true. A company’s business license or registration doesn’t mean that the government has approved or endorsed them.
We can reduce your debt by 60% or more: Not true.Your creditors are under no obligation to reduce your debts.
High pressure sales tactics: Don’t ever be victimized by high pressure sales tactics. Always take your time. Do your due diligence. Check out the company thoroughly. Check with the government office that handles consumer affairs in your province or territory, as well as the Better Business Bureau.
Upfront fees: These companies usually charge you hefty upfront fees and then don’t reduce your debt. Good luck getting a refund.
Debt Relief Program vs Bankruptcy: How Can You Get Debt Relief Safely And Reliably?
Contact a licensed insolvency trustee. We’re federally regulated, our fees are federally regulated, we’re subject to a strict code of ethics and we complete ongoing mandatory professional development each year.
Don’t take chances with your financial future. Contact Ira Smith Trustee & Receiver Inc. We’ll evaluate your situation and help you to arrive at the best possible solution for your problems. Let us help restore you to financial health and give you back peace of mind Starting Over, Starting Now. Give us a call today. You’ll be happy you did.
Kanye West is $53 million in debt and needs a Kanye debt gofundme. I am really not going to answer the question about why Kanye is $53 million in debt. We have previously written on related topics such as:
I have written this somewhat tongue in cheek article because some of the things I learn in dealing with people in debt as a licensed insolvency trustee, is that bizarre things sometime happen. I even found out that there is really a Kanye debt gofundme website. So here goes some of my ideas, which are no more bizarre than the Kanye debt gofundme site, or one of Kanye’s ideas described below.
Kanye debt gofundme: Kanye West Lemonade Stand
Perhaps some budding entrepreneur should raise money to get him out. They could do a grassroots fundraising and make a Kanye West lemonade stand. Being out there would show people how enthusiastic we are about this.
Entrepreneur: “Excuse me, do you have time to drink $53 million of lemonade for Kanye West? This is the greatest artist of our generation.”
Customer: “I don’t really care for Kanye.”
Entrepreneur: “You don’t like Kanye? Okay … Kanye is very misunderstood. When life gives you lemons, oblige Kanye West lemonade.”
So we got creative. She likes her Kanye debt gofundme lemonade.
I’ll just give. Yay! Thank you. It’s a perfect era for a cup of lemonade. Just cause its Kanye West, here’s another $0.25. Thank you so much better! We got money! We made about $2.
Kanye debt gofundme: Kanye West Tribute Track
Kanye West would tell us that he is the greatest artist of our time yet he is $53 million in debt. So we needed to seek other areas of income. We decided to record our own Kanye tribute track and sell it. We had recorded the ballad, we had to think “what would Kanye do? ” We just needed to get some people to sign up for it on a music streaming site. Hello can you spare a moment? Listen to our exclusive new Kanye West homage. All we need is your credit card!
Rihanna, Rihanna, Rihanna? Would you like to buy our Kanye tribute track? All you need is to sign up with your credit card. I’m so sorry this is not working. No, how could you say that? I think we made some sales.
Kanye debt gofundme: How Are We Doing So Far?
So we have raised funds to get Kanye West out of his debt through our Kanye debt gofundme income streams and we want to know how close we are to $53 million. We have our expenses itemized here and we now have our revenue figure so far – $106. Wholesome lemonade. Marvelous luxury lemonade. Possibly people would prefer a little sweeter.
We crunched some numbers and found out some hard news; Pretty much a $2,300 loss so far. So you see, we need to sell you some lemonade and our cool song track. Your mailing address and then your credit card details please.
Kanye debt gofundme: We Need To Hit Up Some Rich People
We had reached our breaking point. So we had to think “What would Kanye do?” Kanye West said that he wants Mark Zuckerberg to invest $1 billion in his ideas. Mark Zuckerberg, could you afford to lend my friend Kanye West 1 billion dollars? Actually, a billion and $2,300 would be perfect.
I haven’t heard back yet from Mark Zuckerberg? No. I can try some other famous people. Ed Sheeran? Kanye would never talk to Ed Sheeran. Okay. Kim Kardashian? Oh yes, utterly. “Hey, you love Kanye almost as much as Kanye loves Kanye.” Do you have $53 million you can give him?
I haven’t heard back from Kim, but she’s a busy woman. Rumour has it that she may have already helped out hubby by paying out that debt. Regardless, we had created one of the most influential lemonade stands of all time. Hopefully Kanye can move forward with all of his dreams.
Kanye debt gofundme: How Can You Deal With Too Much Debt?
I hope that you realize from this blog that only you can be the one to deal with your debt to get on top of it and gain back your life. If you don’t know how to go about reducing your debt, start by contactingIra Smith Trustee & Receiver Inc. There are many ways to deal with debt. As experts we can help you make the best choice and set you on a path to debt free living Starting Over, Starting Now. Make an appointment for a free, no obligation today.
