Debt News

June 15, 2012

Fresh Statistics Canada data shows the ratio of debt to personal disposable income rose to 152 per cent last quarter, up from 150.6 at the end of 2011.

The number will likely be of concern to Mark Carney, who heads the Bank of Canada, which warned again this week that the record level of household debt leaves Canadians vulnerable to an economic shock.

The first quarter numbers show that despite the increase in debt as a percentage of disposable income, borrowing actually slowed — by 0.9 per cent.

As well, household net worth rose to $185,800 from $182,900 the previous quarter, mostly due to gains in the value of stock investments and pension assets.

May 10, 2012

The Ontario Government’s Ministry of Consumer Services is the latest government body to issue a consumer alert “warning consumers to exercise caution when considering a contract for debt settlement services.” They warn that “complaints about companies offering debt settlement services are increasing,” and “most of the complaints are about unclear or misleading contracts, excessive fees, and failure to reduce debts as promised.”

If you are considering using a debt settlement company read the following official government warnings and learn the difference between debt consolidation and debt settlement. Make an informative decision!

Government of Canada Consumer Alert

Ontario Government Consumer Alert

June 21, 2012

Consumer Protection BC has identified 3 new contraventions where Cash Store Financial Inc. has violated BC’s payday lending laws. Cash Store Financial Inc. is a Canadian payday lender, more commonly known as The Cash Store or Instaloans.

During routine inspections, Consumer Protection BC discovered that these contraventions occurred on 30 occasions. Cash Store has been ordered to pay a total of $6,200 in administrative penalties for these violations which include:

June 22, 2012

Shown below is an actual letter that was sent to a bank by an 86 year old woman.

Dear Sir,

I am writing to thank you for bouncing my check with which I endeavoured to pay my plumber last month.

By my calculations, three nanoseconds must have elapsed between his presenting the check and the arrival in my account of the funds needed to honor it.

Yes, ladies and gentlemen, we’re broke. The news is out. It’s not just the United States that can’t make ends meet. Canadian families are out of money, too.

The announcement came in the Vancouver Sun on October 19th 2011 when it was revealed that British Columbia fell behind the rest of the country in giving the age 25- 34 crowd an affordable lifestyle. According to a recent study by Paul Kershaw incomes dropped 6 percent since 1976 in British Columbia for this age group while real estate prices, to mention just one expense, increased by 149% for this same period.

I love that television commercial where a suave elderly man walks towards the camera speaking in a calm dignified voice, "If you (congress) are planning on cutting medical or social security benefits remember we will be watching. There are 50 million of us."

Senior citizens are no longer a small minority that can easily be ignored. We have considerable power, as in political power. The economic side of things is a different story. We've been slip sliding down the slippery slope of indebtedness too.

In a 2009 study by Statistics Canada it was revealed that 34% of retired individuals aged 55 and over, whether single or in a couple, held mortgage or consumer debt. The median amount owed by these individuals was $19,000.