Ontario debt settlement may be a better alternative to bankruptcy or consumer proposals. If you are heavily in debt, there are other debt-relief options available to Ontarians.
For many years, residents of Ontario from Toronto to Ottawa who were deeply in debt thought bankruptcy was their only choice. After all, a Canadian bankruptcy erases all your consumer debts permanently. This debt erasure, however, comes at a price – making you toxic to creditors for several years.
If the effects of personal bankruptcy sound intimidating, that’s understandable. Though a settlement agreement can seem like a long time, its effects don’t last as long as a bankruptcy.
Below is a table with information on the state of debt in Canada since 2017.
Insolvency, Bankruptcy and Consumer Proposal statistics breakdown for Ontario
(Per 1,000 Population Aged 18 Years and Older)
| 2018 | 2019 | 2020 | 2021 | 2022 | |
| Ontario | |||||
|---|---|---|---|---|---|
| Insolvency | 3.4 | 3.8 | 2.9 | 2.5 | 2.9 |
| Bankruptcy | 1.3 | 1.3 | 0.8 | 0.6 | 0.6 |
| Proposal | 2.1 | 2.6 | 2.1 | 1.8 | 2.3 |
| Ottawa | |||||
| Insolvency | 3.8 | 4.0 | 2.8 | 2.4 | 2.5 |
| Bankruptcy | 1.7 | 1.6 | 1.0 | 0.8 | 0.7 |
| Proposal | 2.1 | 2.4 | 1.8 | 1.5 | 1.8 |
| Kingston – Pembroke | |||||
| Insolvency | 4.3 | 4.8 | 3.2 | 3.2 | 3.4 |
| Bankruptcy | 1.9 | 1.8 | 1.0 | 0.9 | 0.9 |
| Proposal | 2.4 | 3.1 | 2.2 | 2.3 | 2.5 |
| Muskoka – Kawarthas | |||||
| Insolvency | 3.6 | 4.0 | 2.6 | 2.4 | 2.8 |
| Bankruptcy | 1.3 | 1.2 | 1.2 | 0.7 | 0.6 |
| Proposal | 2.3 | 2.7 | 1.8 | 1.8 | 2.2 |
| Toronto | |||||
| Insolvency | 2.9 | 3.4 | 2.7 | 2.2 | 2.5 |
| Bankruptcy | 0.9 | 0.9 | 0.6 | 0.5 | 0.4 |
| Proposal | 2.0 | 2.5 | 2.1 | 1.7 | 2.0 |
| Kitchener – Waterloo – Barrie | |||||
| Insolvency | 3.7 | 4.1 | 3.0 | 2.1 | 2.9 |
| Bankruptcy | 1.4 | 1.4 | 0.8 | 0.6 | 0.4 |
| Proposal | 2.3 | 2.7 | 2.2 | 1.4 | 2.0 |
| Hamilton – Niagara Peninsula | |||||
| Insolvency | 3.3 | 3.8 | 2.8 | 2.4 | 2.9 |
| Bankruptcy | 1.3 | 1.3 | 0.8 | 0.6 | 0.6 |
| Proposal | 2.1 | 2.5 | 2.0 | 1.8 | 2.3 |
| London | |||||
| Insolvency | 4.2 | 4.5 | 3.2 | 3.0 | 3.4 |
| Bankruptcy | 1.6 | 1.5 | 0.9 | 0.8 | 0.7 |
| Proposal | 2.6 | 2.9 | 2.3 | 2.2 | 2.6 |
| Windsor – Sarnia | |||||
| Insolvency | 4.0 | 4.4 | 3.1 | 2.9 | 3.4 |
| Bankruptcy | 1.9 | 1.7 | 1.0 | 0.7 | 0.8 |
| Proposal | 2.1 | 2.7 | 2.1 | 2.2 | 2.6 |
| Stratford – Bruce Peninsula | |||||
| Insolvency | 2.6 | 2.6 | 2.1 | 2.0 | 2.0 |
| Bankruptcy | 1.2 | 1.2 | 0.7 | 0.6 | 0.6 |
| Proposal | 1.4 | 1.5 | 1.3 | 1.4 | 1.4 |
Table source – Office of the Superintendent of Bankruptcy Canada
Many residents seem to be learning that bankruptcy is not the best option if one is in debt. According to the Office of the Superintendent of Bankruptcy, between 2020 and 2021, there was an 11% decline in the number of insolvencies in the province. Nevertheless, this figure is not necessarily as encouraging as it could be because it is more difficult and expensive to file for bankruptcy in Canada than ever before. These hurdles may contribute more to the decline in insolvencies than consumers paying off their debt.
Ontario Debt Settlement – A Way Out
A better option may be debt settlement, which can wipe away a good portion of your debt without harming your credit as seriously. Moreover, it is relatively easy to get a debt settlement in Ontario, so you will not have the same fees for legal advice or time in court as for bankruptcy. Furthermore, you won’t have to deal with a licensed insolvency trustee (consumer proposal) or bankruptcy trustee. And if it hurts your credit in the short term, a settlement agreement does not remain on your credit report for six years.
The debt settlement process consists of negotiations with creditors to accept debts as paid in full for less than what you owe. Someone might agree, for example, to settle a $10,000 debt with a creditor for $4000. Once the creditor signs the agreement and the debtor pays the new sum, the debtor no longer has to worry about collection calls.
You may try to negotiate an Ontario debt settlement on your own. But this is not optimum because creditors are experts at securing the best terms for themselves, not you. That is why you should get professional debt settlement help. Fill out the Canada debt relief form for expert help and advice with debt relief in Ontario, Canada.