ards that you want to consolidate, your monthly payment over a five year period, with no interest, would be $1,000 per month.

Can you afford $1,000 per month? Obviously your loan payment will be more than $1,000 per month because there will be interest as well, but if you cannot afford $1,000 per month, you clearly will not be able to a

As a licensed trustee in bankruptcy in Canada, I meet with many people who explain their debt problems to me, and then they ask me if they should get a debt consolidation loan, or go bankrupt.

I answer their question by explaining the differences between debt consolidation loans and personal bankruptcy. Obviously both alternatives are methods for dealing with debt, but they have very different implications.

A debt consolidation loan is simply a loan where you use the money to repay other debts. If you have a lot of credit card debt, you could get one loan from the bank, repay your credit cards, and end up with a loan at a lower interest rate, and perhaps a reduced monthly payment, and all of your credit cards are paid.

If you file for personal bankruptcy, all of your debts are also paid, but of course you are left with a bankruptcy note on your credit report. In that case bankruptcy is not better than a debt consolidation loan.

To decide which option is right for you, do some math. If you were able to get a debt consolidation loan at a zero interest rate (which is generally impossible, but let's keep the math simple by asking the question), and you were to borrow enough to repay your debts in five years, what would be your monthly payment? For example, if you have $60,000 in credit cards that you want to consolidate, your monthly payment over a five year period, with no interest, would be $1,000 per month.

Can you afford $1,000 per month? Obviously your loan payment will be more than $1,000 per month because there will be interest as well, but if you cannot afford $1,000 per month, you clearly will not be able to af

Obviously both alternatives are methods for dealing with debt, but they have very different implications.

A debt consolidation loan is simply a loan where you use the money to repay other debts. If you have a lot of credit card debt, you could get one loan from the bank, repay your credit cards, and end up with a loan at a lower interest rate, and perhaps a reduced monthly payment, and all of your credit cards are paid.

If you file for personal bankruptcy, all of your debts are also paid, but of course you are left with a bankruptcy note on your credit report. In that case bankruptcy is not better than a debt consolidation loan.

To decide which option is right for you, do some math. If you were able to get a debt consolidation loan at a zero interest rate (which is generally impossible, but let's keep the math simple by asking the question), and you were to borrow enough to repay your debts in five years, what would be your monthly payment? For example, if you have $60,000 in credit cards that you want to consolidate, your monthly payment over a five year period, with no interest, would be $1,000 per month.

Can you afford $1,000 per month? Obviously your loan payment will be more than $1,000 per month because there will be interest as well, but if you cannot afford $1,000 per month, you clearly will not be able to a

t rate, and perhaps a reduced monthly payment, and all of your credit cards are paid.

If you file for personal bankruptcy, all of your debts are also paid, but of course you are left with a bankruptcy note on your credit report. In that case bankruptcy is not better than a debt consolidation loan.

To decide which option is right for you, do some math. If you were able to get a debt consolidation loan at a zero interest rate (which is generally impossible, but let's keep the math simple by asking the question), and you were to borrow enough to repay your debts in five years, what would be your monthly payment? For example, if you have $60,000 in credit cards that you want to consolidate, your monthly payment over a five year period, with no interest, would be $1,000 per month.

Can you afford $1,000 per month? Obviously your loan payment will be more than $1,000 per month because there will be interest as well, but if you cannot afford $1,000 per month, you clearly will not be able to a

r you, do some math. If you were able to get a debt consolidation loan at a zero interest rate (which is generally impossible, but let's keep the math simple by asking the question), and you were to borrow enough to repay your debts in five years, what would be your monthly payment? For example, if you have $60,000 in credit cards that you want to consolidate, your monthly payment over a five year period, with no interest, would be $1,000 per month.

Can you afford $1,000 per month? Obviously your loan payment will be more than $1,000 per month because there will be interest as well, but if you cannot afford $1,000 per month, you clearly will not be able to a

ards that you want to consolidate, your monthly payment over a five year period, with no interest, would be $1,000 per month.

Can you afford $1,000 per month? Obviously your loan payment will be more than $1,000 per month because there will be interest as well, but if you cannot afford $1,000 per month, you clearly will not be able to afford the payment with interest either. And that's the key to the decision.

If you qualify for a debt consolidation loan, and if you can afford the payments, a debt consolidation loan is probably the correct option. If you can only afford $500 per month, a debt consolidation loan is not the correct option, because you will not be able to make your payments. You may be better off with a consumer proposal, credit counseling, or personal bankruptcy.

To answer the question for yourself, make a list of your debts, make a monthly budget, and then contact a financial advisor or bankruptcy professional to help you assess whether debt consolidation or a bankruptcy is the best option for helping you deal with your debts.