Some Canadians may have been lulled into a false sense of financial security over the last 18 months due to COVID-related relief programs, according to A.Farber & Partners, a Licensed Insolvency Trustee. Canadians who may have otherwise faced financial insolvency pre-pandemic, now found themselves in a situation where they were able to manage their finances and pay monthly bills. But as these relief programs are scheduled to wind down, many of these Canadians will return to their true debt reality and will likely struggle to keep up with their monthly bills and mounting debt.
“The first step towards Canadians owning their financial future is to ask for help. But some delay getting help due to feelings of shame, not fully coming to terms with their debt or by rationalizing it’ll get better. For 43 years we’ve been partnering with Canadians to help them weather their financial crisis through our proven debt solutions. We empathize with Canadians and show them their debt is a situation; not who they are. Most of them tell us they wish they would’ve started the process years sooner, as they are able to reclaim their self-confidence and be optimistic about their financial future, once they do get started,” says Shane Pennell, Chief Executive Officer of A.Farber & Partners.
Last year the Office of the Superintendent of Bankruptcy Canada (OSB) reported its largest annual decrease ever recorded in Canadian consumer and business insolvency filings. The decrease coincided with the onset of COVID-19 and emergency responses. And the trend continued into the first half of 2021, which also saw a significant decrease in insolvency filings.
Pennell adds, “Canadians are not filing for financial insolvency at the expected rate during the pandemic. We attribute the decrease to the income support and lender deferral programs that enabled these already overburdened and cash-strapped Canadians to temporarily get by each month and pay their bills. But it also created a false debt reality for many enabling them to delay the inevitable when it comes to their debt. As income support winds down, we anticipate a potential surge of Canadians facing insolvency in 2022.”
As insolvency filings are expected to increase over the next 6-12 months, A.Farber & Partners has expanded its national reach to partner with more Canadians in one of their greatest times of financial need. Recently it opened new offices in three new provinces in Manitoba, Saskatchewan, and Nova Scotia. Currently it has almost 100 offices and over 250 employees.
A.Farber & Partners offers a dedicated team of Licensed Insolvency Trustees that partner with Canadians to identify a viable debt solution that matches their specific financial situation, such as a consumer proposal. A consumer proposal is a legally binding process, which can only be administered by a Licensed Insolvency Trustee, the only government regulated debt professionals in Canada. As a debt solution, a consumer proposal offers to pay creditors a percentage of what is owed to them without interest and enables Canadians to regain control of their finances and get back on their feet more quickly.
The majority of Canadians partnering with A.Farber & Partners opt for a consumer proposal due to its many benefits including repaying only a portion of their debt through one manageable monthly payment based on what they can afford. It also enables them to feel better about paying back a percentage of their debt to creditors and has less impact on their credit score in the future. So over time, and as Canadians rebuild their finances, they will be eligible for such lifestyle staples as car loans.
A.Farber & Partners also provides long-term education and counselling services. These education and counselling services are geared towards helping Canadians get back on track and better understand debt including the difference between good versus bad debt and how to effectively manage it to build a healthier relationship with their finances in the future.
SOURCE A. Farber & Partners