Check out our new documentary DEBTASIZED.

Check out our new documentary DEBTASIZED.

Debt Consolidation Toronto

Toll Free: 1-866-747-0660

google logoHoyes, Michalos & Associates Inc.Hoyes, Michalos & Associates Inc.
5.0 Stars - Based on 1927 User Reviews

Debt consolidation allows you to combine all of your unsecured debts into one easy monthly payment. You can:

  • reduce your monthly payments
  • pay bills in just one simple payment
  • save interest, fees, and penalties
  • get out of debt faster.

If you have been researching debt consolidation or debt consolidation loans in the Greater Toronto Area you may have questions about what consolidation program or service is best. Our team of Toronto debt consolidation experts provide free consultations to review your financial situation and help you choose the best consolidation option.

With 9 locations across Ontario, an A+ rating on the Better Business Bureau and an excellent rating from our clients, we will work tirelessly to provide you with the best debt solution for you and your family.

There are three ways you can consolidate your debts:

  1. borrow money through a Debt Consolidation Loan,
  2. negotiate a repayment plan through a Debt Management Plan or
  3. settle your debts through a Consumer Proposal to your creditors.

Our licensed professionals can help you explore each of these alternatives. Below is some information on each solution to help guide you. Feel free to contact us to ask any questions you may have.

Debt Consolidation Loans

Who is eligible? If you have reasonably good credit you may be able to borrow money from a bank, finance company or private lender. You use the proceeds from this loan to repay your other debts, and then make one monthly payment to your new lender.

When it works. A debt consolidation loan is a good option if you have a small amount of unsecured debt and you can obtain a new loan at a much lower interest rate than you are paying today. By reducing your interest costs, your monthly payment is reduced and you can pay off your debts sooner.

Things to consider: Debt consolidation loans are not for everyone. Some factors to consider:

  • if you have poor credit or have missed loan payments in the past, you may not qualify
  • depending on who grants the loan, your interest rate may be too high
  • you may need to have a co-signer or use collateral (such as a home equity loan)
  • if you miss payments you risk losing your home or can put your co-signer at risk
  • depending on your provider, you can end up paying high up-front fees.

Don't put your finances at risk. Let our professionals help you explore the best solution for your needs.

Get Started

Debt Management Plan

Who is eligible? You must be able to repay all of your debts in full, although you may need more time and perhaps relief from interest and penalties. A Debt Management Program is a service offered through not-for-profit credit counselling agencies. They will try to negotiate with your creditors a repayment plan that you can afford based on your monthly budget. The agreement usually includes a reduction, or even total forgiveness of, interest and penalties but only if you successfully complete the program.

When it works. A Debt Management Plan works best if you have only a small amount of credit card debt that you can afford to pay off, but you can’t repay the high-interest rates charged. Not all creditors will negotiate with your credit counsellor, so not all debts can be included.

Things to consider: Anyone can claim to be a credit counsellor and offer to settle your debts with your creditors. No license is required, and the program is not part of the federally legislated Bankruptcy and Insolvency Act. Some things you should know:

  • A DMP or informal debt settlement is NOT legally binding. Any creditor can opt-out of the plan.
  • Your wages can still be garnished and collection calls can, and probably will continue.
  • Not all creditors will negotiate with your credit counsellor. You should never make any payments until you are sure you have a written agreement in place.
  • If you are unable to complete the plan, everything goes back to the beginning.  All of your debts are back, plus new penalties and interest.

At Hoyes Michalos we have both accredited credit counsellors and licensed insolvency trustees who can present you with a full range of debt relief solutions

Get Help Now

Consumer Proposal

Who is eligible? If you owe less than $250,000 in unsecured debt (not including your mortgage or secured car loan) and you cannot afford to repay your debts as they come due you qualify for a Consumer Proposal. If you owe more than $250,000 you qualify for what is called a Division I Proposal. Both allow you to settle your debts through a legal process administered by a Bankruptcy Trustee under the Bankruptcy and Insolvency Act.

When it works. All unsecured debts are included in a consumer proposal. If you owe money on your credit cards, have payday loans, tax debts, even outstanding phone or utility accounts, these are included. You can even cancel contracts like expensive car leases you would like to get out of.

Things to consider: A consumer proposal, if accepted, will:

  • stop all legal action including collections and wage garnishments
  • allow you to keep assets such as your home or car (as long as you can maintain the monthly payments)
  • deal with all of your unsecured creditors, no-one can ‘opt out’
  • reduce what you have to repay, often to as low as 25% although it depends on what you can afford
  • allow you the protection only a Trustee in Bankruptcy can provide but allow you to AVOID bankruptcy.

A consumer proposal can reduce your debt by up to 70% and is often the lowest cost debt relief solution.

Get Relief Now

Using Your Home Equity to Consolidate Debt

Home values in Toronto have boomed over the past several years. If you have high credit card debt, unsecured lines of credit and personal loans that are at their limit, you may be asking how you can use your home equity to pay down that debt.

A debt consolidation that leverages the equity in your home may be a good solution for dealing with your debt. Refinancing and consolidating your debt within a mortgage means that you will pay a lot of interest on that loan over the course of your mortgage’s life. It will certainly free up cash flow, as the payment on the consolidated debt is likely to be much lower than the payments on the high interest consumer debt.

How does it work?

  1. There must be sufficient equity in your home to enable you to consolidate all of your debt. A partial consolidation will do little to provide you with the relief that you need.
  2. The new mortgage payment must be affordable and not result in you defaulting on your mortgage. Linking your home equity to your debt means that if you can’t make the payments you could lose your home.
  3. Once you have consolidated your credit cards and unsecured lines of credit you need to close those accounts so you don’t rack up balances again.

With your consolidation loan in place, you should direct a portion of your increased cash flow to savings. It’s important to build up an emergency fund so that you don’t need to borrow money to deal with any unforeseen expenses. If you follow these steps, a debt consolidation leveraging your mortgage could work well the get you on the path to a debt-free future.

Not enough equity?

If you find out that you don’t have enough equity to deal with all your debt or your credit score is stopping you from qualifying for a debt consolidation, there’s still a way to deal with your debt. 

Licensed Insolvency Trustees are responsible for looking at all of the options for dealing with debt. If you don’t have enough home equity to refinance and pay off all your debt, it could be enough to settle your debt through a consumer proposal.

If you already own a home and have a mortgage, a temporarily reduced credit score while you restructure your debt is not likely to cause you any problems in the long run. Being debt-free and a homeowner is far more important than having a good credit score but carrying too much debt.

Can’t get refinancing approved

A tighter credit market may mean Toronto homeowners will no longer qualify for a debt consolidation loan or second mortgage to restructure high-interest debt. A consumer proposal can be a great option to allow you to utilize the equity in your home in an interest-free debt repayment arrangement. 

If you’re not sure whether or not you should leverage your home equity to consolidate your debt, contact us today for a free consultation.

Find Out What Option Is Best For You

As federally Licensed Insolvency Trustees in Toronto, we are required by law to help you explore all of your debt relief alternatives. 

With 9 locations across Ontario, an A+ rating on the Better Business Bureau and an excellent rating from our clients, we will work tirelessly to provide you with the best debt solution for you and your family.


When working with Hoyes Michalos you are guaranteed respect, confidentiality, and expert financial advice. At Hoyes Michalos we believe you should always talk with a professional. For over 20 years we’ve focused solely on helping individuals find debt relief. 

Contact us today to discuss how we can help you consolidate your debt and become debt free.

Get Started

To reach us, call us at 1-866-747-0660 or contact any of the trustees in any one of our Greater Toronto Area locations.