Debt Mountain

Household debt in Canada is now bordering on excessive, catalyzed by low rates setting off a boom of borrowing over the last decade. Canadians now collectively owe C$2.16 trillion, which as a share of GDP is the highest debt load in G-7 economies. At the same time, the housing market is starting to cool and people are starting to "freak out", even with rates not far above historical lows, according to Bloomberg. The article profiled one citizen, Kieran Maxwell, a 43 year old single mom who is about C$100,000 in debt primarily from student loans and credit cards. In 2017,…

HELOC’s: Where ignorance is apparently bliss

As a collection agency with offices in Edmonton, Calgary and the GTA we have recognized that over the last 15 years home equity lines of credit have emerged as the driver of mounting non-mortgage debt in Canada — yet many Canadians don't understand what they've signed up for and are not moving to pay them off, a new survey suggests. The more than three million Canadians holding a HELOC owed an average amount of $65,000, the study released earlier this month by the Financial Consumer Agency of Canada (FCAC) found. About one quarter of HELOC holders had a balance of…

The Worm is turning in the Canadian credit market

As a collection agency with offices in Edmonton, Calgary and the GTA we were alerted yesterday when Equifax Canada reported that consumer delinquencies climbed higher in the fourth quarter of 2018 and the credit monitoring company warns that rising delinquency rates are likely to become the norm this year. It says the 90-day mortgage delinquency rate rose by 1.5 per cent from the fourth quarter of 2017 to 0.18 per cent at the end of last year. The comparable non-mortgage rate was up 0.4 per cent to 1.07 per cent. "As we expected, the worm is turning in the Canadian…

When Can A Collection Agency Call You?

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Are you dealing with a collections issue, and wondering when a collection agency can and cannot call you? The team at our Calgary Collection Agencyshare their expert answers today. 1. When Can A Collection Agency Call You? An Alberta-based collection agency can call you any time between 7 AM and 10 PM Alberta time. 2. Can a Collection Agency Call You at Work? The short answer to whether or not a collection agency can call you at work, is yes. However, there are guidelines in place. If you directly ask a collection agency not to call you at work, they…

Bankrupcies; Meh…

The latest figures from the Office of the Superintendent of Bankruptcy Canada released on January 10, 2019 show the number of Canadian businesses and consumers financially going under jumped significantly in November 2018 compared to a year ago. Alberta continues to lead the nation. Total insolvencies in Alberta in November 2018 — including bankruptcies and proposals were up 20.2 per cent in comparison to November 2017. As discussed in our previous post Canadians owe $1.775 in credit market debt, which includes consumer credit and mortgage and non-mortgage loans, for every dollar of household disposable income in the third quarter. Not…

Canadians; CRAZY in love with debt

As a collection agency with offices in Edmonton, Calgary and the GTA we recognize that the vast majority of consumers we inevitably end up dealing with are good people, with good intentions, that have now simply arrived at the tipping point of having to either try to continue to rob Peter to pay Paul or, in the alternative, to make some hard choices in monthly budgeting in order to honour their outstanding financial obligations. On our note above its no surprise to see that the amount Canadians owe relative to their income ticked higher in third quarter of 2018! Statistics…

Harbinger of Turmoil: When the Bank of Canada Buys

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As a collection agency with offices in Edmonton, Calgary and the GTA we are watching with keen interest the unfolding of the following events with respect to their impact (or lack thereof) on Canadian credit markets. In mid November the Bank of Canada (BOC) announced for the first time that they would look to start buying government-backed mortgage bonds, also known as Canada Mortgage Bonds which are guaranteed by Canada Mortgage and Housing Corp.  Well, it took less than a month for the BOC to execute on its intentions, because yesterday, the central bank purchased Canada Housing Trust bonds for…

Differing Degrees of Misery is still Misery

Just how much money do you need to be among the global 1 percent? According to the 2018 Global Wealth Report from Credit Suisse Research Institute, you need a net worth of $871,320 U.S. or $1,141,429.20 CDN using an exchange rate of 1.31 as of the time of this post. Credit Suisse defines net worth, or “wealth,” as “the value of financial assets plus real assets (principally housing) owned by households, minus their debts.” From page 29 of the report specifically addressing Canada, the average wealth per adult in Canada, at USD 288,260 ($377,620 CDN), is 29% lower than that…

Consumer Cannon Fodder

Good news for long abused savers while long favoured debtors are nudged a little closer to the precipice. It appears overindebted Canadian consumers can now officially consider themselves nothing but cannon fodder at the Bank of Canada. Governor Stephen Poloz and his deputies on the Governing Council raised the benchmark interest rate a quarter-point to 1.75 per cent today, as expected.  Considering the move, we anticipate as a receivables management firm default rates will slowly rise. They said they feel pretty good about the economy, now that politicians in Canada, Mexico, and the United States have agreed on a revised…

CPA Survey of Employees

More evidence was released in September that an alarming proportion of Canadians are in financial quicksand. The Canadian Payroll Association’s annual survey shows 40 per cent of working Canadians feel “overwhelmed” by their debt, with more than one-third of respondents saying they loaded up on leverage over the last year. (Will we ever learn). Meanwhile, one-fifth of respondents said they wouldn’t be able to scrape together $2,000 within a month in case of emergency. Other disturbing data points include: • 44% of Canadians live pay cheque to pay cheque • 46% say financial stress is impacting their workplace performance •…