Find People, Find Phone Numbers, Find Addresses, Find Buisnesses, Your #1 Trace tool & collection agency guide My skip assist
People Finding websites
Finding people using google, google tricks,
Consumer protection websites canada
Make Collection Agency's Stop Calling You
Collection agency rules Alberta
Collection Agency Rules British Columbia
Collection Agency Rules Saskatchewan
Collection agency rules Manitoba
Collection Agency Rules Ontario
Collection Agency Rules Quebec
QUEBEC CONSUMER PROTECTION ACT PAGE 2
Collection Agency Rules PEI
Collection Agency Rules Newfoundland & Labrador
Collection agency rules Nunavut
Collection Agency Rules Northwest territories
Collection agency rules in Yukon Territories
Government Of Canada Everything You need to know about credit Page 1
Government Of Canada Everything you need to know about credit Page 2
Goverment of canada everything you need to know about credit page 3
United States Collection Agency Rules
Collection agency rules state of Alabama
Collection Agency Rules Alaska
VIDEO PAGE - VIDEO GUIDE TO STOPPING COLLECTOR CALLS YOUR CREDIT AND MORE
How to file a collection agency complaint and all the collection agency rules.
All your options from bankrupcy to credit counsellors and everything inbetween
List of all trustees in Canada
Canadian Consumer Handbook Collection Agencies
Canadian Consumer Handbook Contracts
Canadian Consumer Handbook Credit Reporting
Canadian Consumer Handbook Debit Card Fraud
Canadian Consumer Handbook Debt
Canadian Consumer Handbook Financial Services
Canadian Consumer Handbook Mortgages
Canadian Consumer Handbook Payday Lending
Build Your Buying Skills From OCA
Spending Smarter Tools from OCA
Take Charge of Your Debt from OCA
Cellphones from OCA
Learn About the Retail Market from OCA
Protect Your Privacy from OCA
Get a Mortgage, Mortgage Refinanace, Second Mortgage, Equity Loan
Mortgage Basics- What you need to know
How credit effects your mortgage
Guestbook
ALL Collection Agency's in Canada page 1
ALL Collection Agency's in Canada Page 2
ALL Collection Agencys in Canada page 3
ALL Collection Agency's in Canada Page 4
ALL Collection Agency's in Canada Page 5
My Skip Assist Find anyone, person search, phone number search, business search, collection agency tools, repossession search, court baliff search
Skip tools for collection agencys, repossessions, court balif tools, Person search, Phone number search, Address search, Business search

Goverment of canada everything you need to know about credit page 3

 How to Deal with Mortgage Payment Difficulties

When unforeseen financial circumstances impact your ability to make regular mortgage payments, it’s important for you to take quick action. With early intervention, cooperation, and a well executed plan, you can work together with your mortgage professional to find a solution to your financial difficulties.

What Can I Do to Help?

If you find yourself facing financial difficulties, as a result of job loss, family income reduction, or for other reasons, it can be an overwhelming experience leaving you feeling uncomfortable and unsure of what to do. By following these three simple steps, you can make a big difference in resolving your financial difficulties.

1. Talk to your mortgage professional

  • To increase the chance of successfully managing your financial situation through early intervention, call your mortgage professional at the first sign of financial difficulty;
  • Ask the mortgage professional about information on the options available for managing your financial situation; and
  • Keep the mortgage professional informed as circumstances evolve.

2. Clarify the financial picture

In order to help your mortgage professional fully understand your financial situation, before meeting with them, prepare a detailed list of financial obligations including any credit cards, loans, household bills with the amounts owing and their due dates. Be sure to include information about your current income, savings accounts, investments, and any other assets.

3. Stay informed

The more information you have at your disposal on managing your finances, the easier it will be to make the right decisions.

Take Charge of Your Debts is an online tool from the Government of Canada that is designed to help borrowers like you understand debt problems, and includes information on making a budget, budget counselling, collection agencies, credit, and credit repair. To view this tool, log on to www.ic.gc.ca (Industry Canada) and search for “Take Charge of Your Debts”.

How Can Mortgage Professionals and CMHC Help?

Your mortgage professional wants to establish and maintain a positive relationship with you over the long term, and is fully trained and equipped with the tools to help you deal with the temporary financial setbacks that you may be facing.

For mortgages insured by Canada Mortgage and Housing Corporation (CMHC), CMHC provides mortgage professionals with tools and the flexibility to make timely decisions when working with you to find a solution to your unique financial situation. These tools include:

  • Converting a variable interest rate mortgage to a fixed interest rate mortgage in order to protect you from a sudden interest rate increase, should one occur.
  • Offering a temporary short-term payment deferral. Your mortgage professional may be prepared to offer greater payment flexibilities, particularly if previous lump sum prepayments have been made, or if you have previously chosen an accelerated payment schedule.
  • Extending the original repayment period (amortization) in order to lower your monthly mortgage payments.
  • Adding any missed payments (arrears) to the mortgage balance and spreading them over the remaining mortgage repayment period.
  • Offering a special payment arrangement unique to your particular financial situation.

CMHC is also willing to consider other alternatives proposed by the mortgage professional to resolve or avoid mortgage payment default. In every case, the options available will depend upon your individual financial circumstances.

CMHC is Canada’s national housing agency. For over 65 years CMHC has shared a wealth of knowledge and housing expertise to help create an informed and reassured homeownership experience for Canadians.

 

24 hour mortgage approval - no credit, no job no problem - equity based funding in 48 hours!

 

 

Credit report, credit score and credit rating

Credit Report: A credit report is a detailed report of your credit history and is kept by at least one of Canada's credit-reporting agencies.

Credit Score: Your credit score is an up-to-date rating of your financial health. It shows lenders the level of risk if they lend you money.

Credit Rating: A credit rating is a rating of each of each of your credit history items on a scale of 1 to 9. These ratings are made by credit-reporting agencies.

Request your credit report

You can get your credit report for free. This allows you to see your credit rating and gives you a chance to correct any mistakes on the report.

Correct a mistake on a credit report

Your credit information can be kept by more than one credit reporting agency. Since these agencies do not always share information, it's important for you to check all of your credit reports carefully. If you find an error in your credit report, you can take steps to have the error corrected.

Improve your credit score

If your credit score is not as high as you think it should be, check the information in your credit report. If the report is correct, read it carefully to find out what might be bringing down your score. You can then work to improve your credit score.

Hire a company to change your credit rating?

There is no reason for you to pay a company to rebuild your credit rating. There is nothing they can do to change your credit rating that you cannot do yourself.

 

 


Credit Report, Credit Score and Credit Rating

Credit Report / Credit File

Along with the credit histories of millions of other people, your credit history is recorded in files maintained by at least one of Canada's major credit-reporting agencies: Equifax Canada and TransUnion Canada. It is possible to obtain your credit file for free. Please consult the agencies' websites in order to obtain more information. These files are called credit reports. A credit report is a "snapshot" of your credit history. It is one of the main tools lenders use to decide whether or not to give you credit.

Your credit file is created when you first borrow money or apply for credit. On a regular basis, companies that lend money or issue credit cards to you, including banks, finance companies, credit unions, retailers, send specific factual information related to the financial transactions they have with you to credit reporting agencies.

Summary of methods to request your credit report and their respective characteristics

Mail

Advantages
  • Free of charge
Disadvantages
  • Credit score is not provided
  • Can take some time to receive

Internet

Advantages
  • Almost instant report
  • Option to get credit score
Disadvantages
  • Fee charged

Credit Score

Your credit score is a judgment about your financial health, at a specific point in time. It indicates the risk you represent for lenders, compared with other consumers.

There are many different ways to work out credit scores. The credit-reporting agencies Equifax and TransUnion use a scale from 300 to 900. High scores on this scale are good. The higher your score, the lower the risk for the lender. Lenders may also have their own ways of arriving at credit scores. In addition, lenders must decide on the lowest score you can have and still borrow money from them. They can also use your score to set the interest rate you will pay.

Credit Rating

Some credit-reporting agencies report the lenders' rating of each of your credit history items on a scale of 1 to 9. A rating of "1" means you pay your bills within 30 days of the due date. A rating of "9" means that you never pay your bills at all or that you have made a consumer debt repayment proposal to the lender. A letter will also appear in front of the number: for example, I2, O2, R2. The letter stands for the type of the credit you are using.

  • "I" means you were given credit on an installment basis, such as for a car loan, where you borrow money once and repay it in fixed amounts, on a regular basis, for a specific period of time until the loan is paid off.
  • "O" means you have open credit such as a line of credit, where you borrow money, as needed, up to a certain limit and the total balance is due at the end of each period. This category may also include student loans, for which the money may not be owing until you are out of school.
  • "R" means you have "revolving" credit, where you make regular payments in varying amounts depending on the balance of your account, and can then borrow more money up to your credit limit. Credit cards are a good example of "revolving" credit.

The most common ratings are "R" ratings. These are known as North American Standard Account Ratings and are the most frequently used. The "R" indicates that the item being described involves revolving credit. If you always pay on time, it will be coded an R1. If an amount was written off because you never paid it back, it is coded R9. The R ratings are a coding system that translates "on time", "one month late", "two months late", etc., into two-digit codes.3

North American Standard Account Ratings : "R" Ratings

R0: Too new to rate; approved but not used.
R1: Pays (or paid) within 30 days of payment due date or not over one payment past due.
R2: Pays (or paid) in more than 30 days from payment due date, but not more than 60 days, or not more than two payments past due.
R3: Pays (or paid) in more than 60 days from payment due date, but not more than 90 days, or not more than three payments past due.
R4: Pays (or paid) in more than 90 days from payment due date, but not more than 120 days, or four payments past due.
R5: Account is at least 120 days overdue, but is not yet rated "9."
R6: This rating does not exist.
R7: Making regular payments through a special arrangement to settle your debts.
R8: Repossession (voluntary or involuntary return of merchandise).
R9: Bad debt; placed for collection; moved without giving a new address or bankruptcy.

NOTE : Other rating indicators that might be found on a report are "I" for installment credit or "O" for open credit line.

Source : Equifax Canada

More Information

To see examples of what credit reports look like and to get more information on credit scores, visit the Financial Consumer Agency of Canada's publication entitled Understanding Your Credit Report and Credit Score.

Here are Canada's major credit-reporting agencies:

Equifax Canada
Tel: 1-800-465-7166
Fax: 514-355-8502

TransUnion Canada
Tel: 1-866-525-0262 (except in Quebec)
Tel: 1-877-713-3393 (Quebec residents)
 

How To Request a Copy of Your Credit Report

Various Methods

Summary of methods to request your credit report and their respective characteristics

Mail

Advantages
  • Free of charge
Disadvantages
  • Credit score is not provided
  • Can take some time to receive

Internet

Advantages
  • Almost instant report
  • Option to get credit score
Disadvantages
  • Fee charged

By mail — free of charge1

If you make your request in writing and send it by mail, the credit-reporting agencies will provide you, by mail, with a free copy of your report. It is important, however, that in your request you include a copy of two pieces of I.D. Contact the credit-reporting agencies to find out which pieces of I.D. are acceptable. You will find the coordinates for each agency below.

Online — some fees apply

You can also order your credit report through the reporting agencies' websites. This method is faster since you will receive your credit report online only a few minutes after you made the request. However, credit-reporting agencies charge a fee for providing you with an online copy of your credit report.

  • Equifax Canada: Consumers may obtain a copy of their credit report, plus credit score, and a score analysis online in Canada, for a fee. They provide consumers online, real-time access to their credit information. Consumers provide personal information during the order process for their credit information so that their identity can be verified.2
  • TransUnion: Consumers are asked to provide information that confirms their identity, plus valid credit card payment information, when applicable. Following a confirmation of their information, consumers may view their TransUnion Personal Credit Report & Score online. Ordering online is available to current or former residents of Canada. Fees may vary by province.3

Credit Report Samples — what do they look like?

If you want to know what a credit report looks like and what it contains, you can visit the Financial Consumer Agency of Canada's publication entitled Understanding Your Credit Report and Credit Score for detailed information.

Coordinates for each credit reporting agency

Here are Canada's two major credit-reporting agencies:

Equifax Canada
Tel: 1-800-465-7166
Fax: 514-355-8502

TransUnion Canada
Tel: 1-866-525-0262 (except in Quebec)
Tel: 1-877-713-3393 (Quebec residents)
Fax: 905-527-0401

What to do if you find errors in your credit report / file?

It's a good idea to request a copy of your credit report from the two credit-reporting agencies at least once a year to verify that your personal information is up to date, that your financial information is correct, and to ensure that you have not been the victim of identity fraud. Because your credit information can be kept by more than one credit-reporting agency, and because those agencies do not necessarily share information, it's important to check all credit reports carefully (it is possible to obtain your credit file for free once a year — please consult the agency's website in order to obtain more information).

Errors can include someone else's information on your file; debts listed that aren't yours; debts listed that have been paid in full; and incorrect payment history.

If you do find information in your file that is inaccurate or incomplete

You have the right to explain or protest. Contact the credit reporting agency regarding their dispute resolution process. If you still do not agree with an item following the Agency's investigation, TransUnion and Equifax websites inform you as to how you can add an explanatory statement to your report.

If you are still not satisfied that your file is correct:

  1. You may wish to contact your provincial / territorial regulator responsible for consumer affairs (as credit reporting agencies falls under provincial / territorial jurisdiction). Here is the complete list from the Canadian Consumer Handbook.
  2. You can also contact the Federal Privacy Commissioner (except in the case of Quebec, B.C. and Alberta where you should contact the Provincial Privacy Commissioner). The Personal Information Protection and Electronic Documents Act (PIPEDA) also sets out ground rules for how private sector organizations can collect, use or disclose personal information in the course of commercial activities. Under PIPEDA individuals have a right to see the personal information that a business holds about them, to correct any inaccuracies and to lodge a complaint with the Privacy Commissioner of Canada if they are unhappy with how an organization is handling their information.

Please note: If the incorrect information comes from a federally regulated financial institution, the Financial Consumer Agency of Canada (FCAC) website provides additional information on how to get errors corrected.

Coordinates for the major credit reporting agencies in Canada:

Equifax Canada
Tel: 1-800-465-7166
Fax: 514-355-8502

TransUnion Canada
Tel: 1-866-525-0262 (For all residents except Quebec)
Tel: 1-877-713-3393 (For Quebec residents)

For more information on credit reports and scores, please visit the publication called Understanding Your Credit Report and Credit Score published by the Financial Consumer Agency of Canada.
 

Resources on personal finances and debt

Consumer Measures Committee / Office of Consumer Affairs

Financial Consumer Agency of Canada

Office of the Superintendent of Bankruptcy, Industry Canada

Canadian Bankers Association in partnership with the Financial Consumer Agency of Canada


 

Chapter 7 – Consumer Debt: Summary

7.1 General Trends in Debt

While the proportion of Canadians carrying some form of debt remained unchanged when comparing 1984 with 1999 (70 percent), the median outstanding debt of family units more than doubled, from $12 567 to $29 000. Secured debt (primarily mortgages) played an important role in this growth. The use of many forms of unsecured debt also rose rapidly over this period, including personal lines of credit, credit card debt and student loan debt. Other evidence points towards the increasing use of alternative financial services, such as short-term payday loans. While some consumers appear to be taking advantage of current low interest rates, others seem to be using relatively expensive forms of credit in the day-to-day management of their finances.

Research opportunities include the need for a better understanding of the financial situation and debt management practices of new homebuyers, in light of the high media attention given to historically low interest rates. Given the general level of consumer indebtedness, research could also investigate Canadians' vulnerability to interest rate fluctuations, as well as further explore indicators that could assist in defining over-indebtedness. Finally, research should also be geared towards assessing the financial choices of poor Canadians, including what constraints and factors influence their decision making.

7.2 Trends in Consumer Bankruptcies

Compared to the 1980s, there was a very significant (and largely unexplained) increase in consumer bankruptcies in the 1990s. An examination of data over the last 20 years reveals that consumer bankruptcies are both cyclical and on a long-run upward trend. In fact, there were more than two-and-a-half times as many consumer bankruptcies in the 1990s than during the previous decade. While existing consumer bankruptcy research cannot explain this rapid increase, there does appear to be a consensus regarding some contributing factors: in addition to their very weak financial balance sheets, consumers who declare bankruptcy are more likely to be unemployed (or under-employed) and have significant access to credit.

Research opportunities include further examination of the variables that appear to affect consumer bankruptcies, such as the expansion of consumer credit and the dissolution of family units.
 

Tools and calculators

Compare and choose the financial products and services that suit your needs. Save time and money with our interactive tools.

Financial literacy self-assessment quiz

Credit card tools

 

Mortgage calculators

 

Budgeting Tool

Financial Goal Calculator

Account Selector tool



Which bank accounts are right for you?

Credit cards

    

A credit card is a card that lends the user a limited amount of money to pay for goods and services, with the promise to pay the money back by a certain date.

Credit cards offer a convenient way to pay for goods and services and are usually a person’s first access to credit. It’s important to keep in mind that although useful and convenient, credit cards can sometimes be a very expensive way to borrow money. Understanding how credit cards work and knowing what your rights are as a credit card user can go a long way to helping you make your credit card work for you.

For more information, click on the links below:

 

Which credit card is right for you?

For the most part, credit cards serve the same general function: they’re a convenient way to pay for goods and services. With so many credit cards to choose from, how do you know which credit card is right for you?

Generally, there are three key factors that distinguish one credit card from another:

  • interest rates
  • additional fees and costs
  • rewards and benefits.

Interest rates

If you plan to pay your balance in full every month and don’t use the card for cash advances or cash-like transactions, you won’t pay any interest. In this case, the interest rate may not be an important factor in choosing a credit card.

However, if you usually carry a balance on your credit card, you may benefit from switching to a low-interest rate card, even if it has an annual fee. Many regular credit cards, including standard, gold and platinum cards, have low-rate options available. Here is an example comparing low-rate cards to regular-rate cards.

To encourage you to apply for their cards, some credit card issuers will sometimes offer low introductory interest rates on newly issued credit cards and on balance transfers.

Additional fees and costs

Credit cards may have other fees and policies that can increase your costs. For example, if you miss a payment, some credit card issuers may increase the interest rate that you pay. The amount of these fees and charges varies from one credit card to another, and you should consider them carefully when choosing a card.

By law, all federally regulated financial institutions have to include information about fees and charges in their credit card applications. The information must be clearly set out in an information box at either the beginning of the application, or a related document that you receive at the same time. Be sure you understand all of the fees and charges that apply to a credit card before you complete the application.

You can avoid many of these fees and charges by using your credit card wisely. For more detailed information on credit card fees and penalty charges, read the publication Understanding credit card fees.

Rewards and benefits

If you usually pay off your credit card balance every month, then rewards and benefits may make an important difference for you when you choose a credit card. Before you decide, be sure to consider the actual value of the reward program as well as any limitations there might be.

Specialized credit cards

Most people are familiar with general use credit cards, such as “gold,” “platinum” and standard cards. However, there are specialized credit cards available that cater to specific needs.

Comparing credit cards

Try our Credit card selector tool to help you narrow down your choice. The tool allows you to compare the features and costs of over 250 credit cards and find the one that best meets your needs.
 

Types of fees

Annual fees

Some credit cards charge you a fee each year for the right to use them. This fee is billed directly to your credit card statement. There may be an additional fee if you request another card for the same account.

Cards with an annual fee often offer more rewards and benefits, or a lower interest rate. Before you apply for one, consider carefully how you will use the card and whether the features and rewards are worth the cost to you. If not, you are better off saving your money and choosing a card with no annual fee.

Cash advance fees

You have to pay a fee, called a “cash advance fee,” whenever you:

  • use your credit card to withdraw cash from an automatic banking machine (ABM)
  • use your card to withdraw cash at a bank branch
  • use “convenience cheques,” depending on the issuer
  • charge cash-like transactions to your credit card.

A cash advance fee can be:

  • a fixed amount per transaction
  • a percentage of the transaction
  • a fixed amount plus a percentage.

Some credit card issuers set a minimum and a maximum cash advance fee.

In addition to the cash advance fee, the credit card issuer will charge interest starting on the date you withdraw the money and continue to charge interest daily until you pay off the entire cash advance amount. Cash advances can be an expensive way to replenish the money in your wallet; if possible, use your debit card instead.

If you use cash advances, you should try to pay off as much of your balance as you can, as early as possible, because the interest charged on cash advances costs you more each day you wait. You can make payments to your credit card account at any time—you don’t have to wait for your statement.

Transactions that are treated like cash advances

Balance transfers

A balance transfer is the transfer of the amount you owe from one credit card to another. You might have to pay a fee as well as interest charges to the issuer of the card that you transfer your balance to, starting on the date you make the transaction. If you are not sure whether you have to pay a fee for a balance transfer, read your credit card agreement or contact your credit card issuer.

Convenience cheques

Convenience cheques—which are also called credit card cheques—are cheques provided by a credit card issuer. The issuer charges the amount of the cheque to your credit card. They are usually treated in the same way as cash advances.

While these types of cheques may seem convenient, they can actually be very expensive. You are charged interest on this transaction immediately and will continue to pay interest on this amount until you repay the full amount.

If you receive these kinds of cheques as part of a special offer, make sure that you read and understand all of the terms and conditions that apply.

Cash-like transactions

Cash-like transactions are special item purchases that some credit card issuers treat the same way as cash advances.

Cash-like transactions can include:

  • wire transfers—money sent from one bank to another electronically
  • money orders—a type of payment issued by a bank at your request, which is considered more reliable than a personal cheque because the amount is prepaid
  • traveller’s cheques—prepaid cheques in fixed amounts that allow the person signing them to pay for things
  • gaming transactions—these include placing bets and buying casino gaming chips and lottery tickets.

If you are not sure whether a particular transaction will be treated as a cash advance or as a purchase, contact your credit card issuer.
 

Foreign currency conversion charges

When you use your credit card for a transaction outside of Canada, your credit card issuer charges you the exchange rate plus a foreign conversion mark-up. The foreign conversion mark-up for your credit card is indicated in your credit card agreement.

The foreign currency exchange process varies from one credit card issuer to another, and also depends on which foreign currency is being exchanged.

Some transactions in foreign currencies are converted directly into Canadian dollars, but others may be first converted to U.S. dollars and then to Canadian dollars. The conversion mark-up is applied after the purchase is converted to Canadian dollars.

Example:  

Émilie made a purchase of €1,000 in euros with her credit card. Her credit card agreement indicates that her conversion mark-up is 2.5%.
 
In this example, euros are changed directly into Canadian dollars at an exchange rate of 1.42231. The exchange rate shown here is for the purpose of this example only.
  
Purchase​ €1,000.00​
Value of purchase in Canadian dollars

$1,422.31

Foreign currency conversion mark-up: 2.5% $35.56​
Total cost of the transaction $1,457.87​
 
Émilie will have to pay $1,457.87 in Canadian dollars, which includes a foreign currency mark-up of $35.56.​

Returning goods purchased outside Canada 

If you decide to return merchandise purchased in a foreign currency and get a refund from the merchant, the dollar amount of your refund may be different from the amount of the original transaction on your credit card statement.

The exchange rate fluctuates from day to day, and the exchange rate may be different on the date the refund was processed than on the original transaction date.

Cash advance fee

A foreign cash advance transaction is the same as a regular cash advance transaction, except that your credit card issuer may charge higher fees for these transactions in a foreign country. This fee would be in addition to the foreign currency conversion mark-up.

Penalty costs

Over-the-limit penalty

Your credit limit is the maximum amount that you are allowed to spend on your credit card. Your credit card issuer decides whether to allow any transactions to go through if you go over your credit limit. If you do go over your credit limit, you may have to pay a penalty, which can vary from one card issuer to another.

The credit card issuer will not inform you if you are about to go over your credit limit when you make a transaction. It is your responsibility to pay attention to your balance and make sure you don’t go over your credit limit.

If you are frequently close to your credit card limit, you can ask your credit card issuer to stop any transactions that exceed your credit limit. Some credit card issuers may not offer this service. Even if they do, some types of transactions over your limit may still be processed. This is because some sales, usually of low-value items, go through without the issuer being notified at the moment of sale.

 


 

Exception: Temporary holds on funds

Merchants sometimes put a temporary hold on funds on your credit card to make sure you are able to pay for goods or services you get before you pay for them. By law, federally regulated financial institutions cannot charge over-the-limit fees due to these temporary holds.

For example, Steve has $90 left in his credit limit, and when he uses his card to buy gas at the pump, the gas retailer places a $100 temporary hold on his card until he finishes his fill-up and pays for it. Steve’s fill-up only costs $20. The credit card issuer cannot charge an over-the-limit fee in this case.

This exception does not apply if Steve goes over his credit limit without the temporary hold. For example, if Steve had $10 left within his credit limit, and used his credit card to buy $20 of gas his purchase would take him over his credit limit by $10. Therefore, he could be charged an over-the-limit fee. The $100 temporary hold placed on his card would make no difference.

 

Fees for dishonoured payments

A credit card issuer may charge you a fee to handle a payment that is not honoured, or “bounces.” This fee applies if you:

  • make your payment by cheque and the cheque is returned because of nonsufficient funds (NSF)
  • make your regular payment by a pre-authorized debit that is rejected because of NSF
  • use a convenience cheque to get a cash advance on your credit card, and your credit card issuer returns the cheque because you are over your limit.

In addition, the financial institution that holds the account from which you tried to make the payment may charge you a separate NSF fee.

Inactive account fee

If there has not been any activity on your credit card for a period of time—usually at least a year—some credit card issuers will charge you a fee for maintaining an inactive account, or may even close your account. If you no longer need your credit card, make sure you contact your card issuer to cancel it and keep a record of the cancellation.

Simply cutting up your card does not automatically cancel it, even if your credit card has expired. You may still have to pay an inactivity fee, since you did not cancel the card.

Interest rate increase following missed payments

If you miss making minimum monthly credit card payments by the due date, your credit card issuer may increase the interest rate on your credit card. It depends on your issuer, but your regular interest rate will usually go up between 2% and 6%. The increase can be temporary or permanent, depending on the issuer.

By law, federally regulated financial institutions must notify you in advance of an interest rate increase and in some cases provide a reason for the rate increase.
 

Reprinting charges

Your credit card issuer may charge you when you request copies of certain documents, such as:

  • reprinted statements
  • receipts from transactions on previous statements.

To find out whether your credit card issuer charges a fee for these types of documents, check the terms and conditions of your credit card agreement or contact your issuer directly.

How to avoid this charge

You may be able to avoid the reprinting charge if you view your credit card statements online, free of charge. Credit card issuers usually allow access to online statements for the previous 12 months. However, to take advantage of this service, you will need to register for it on your credit card issuer’s website.
 

How interest is charged on credit card fees

Credit card issuers usually treat fees the same way they treat purchases. If you do not pay your balance in full, and on time, you may have to pay interest on these fees until the date the payment is received in full. If you are not sure how your credit card issuer handles fees, contact your credit card issuer.

What to do if you have a complaint

All banks, and federally incorporated trust, loan and insurance companies must, by law, have a complaint-handling process in place for consumers.

If you don’t know the complaint handling process for your financial institution, you can call us toll-free: 1-866-461-3222 or you can visit the How to lodge a complaint section of our website.
 

Want to file a complaint against your federally regulated financial entity but don’t know how? Read the complaint handling process described below. 

Complaint handling process

Federally regulated financial institutions

All banks, retail associations and federal trust, loan and insurance companies must, by law, have a complaint-handling process in place for consumers.

Should you have a complaint or a problem with a federally regulated financial institution, you can find further information on how to make a complaint here

Payment Card Network Operators

If you are a merchant and you have a complaint or a problem with a payment card network operator, you can find further information on how to make a complaint here.
 

Making a complaint—Financial institution


link to find the complaint-handling process for your financial institution

All banks, retail associations and federal trust, loan and insurance companies must, by law, have a complaint-handling process in place for consumers.

If you have a complaint or a problem with a federally regulated financial institution, you can take the following steps to resolve it. 

Step 1: Local level

First, you should try to resolve the problem directly with the manager or customer service representative of your financial institution. This would involve dealing with branch staff or the branch’s local representative. 

Step 2: Senior level or internal ombudsman

If your complaint cannot be resolved at the branch or local level, it may be referred to a senior staff member or an internal ombudservice. 

Step 3: Third-party review

If your complaint has not been resolved to your satisfaction, you can have it reviewed by a third party or an external complaints body. This service is non-binding and is available to any individual or small business with a complaint. 

Provincial regulator

In some cases, depending on the type of financial institution you deal with, you may also contact your provincial regulator. For a list of the regulators in your province, please visit the Other regulators section of our website or call us toll-free at 1-866-461-3222. 

FCAC

Part of FCAC’s role is to ensure that financial institutions have a complaint-handling process in place. If you are having difficulty finding out about your institution’s complaint-handling process or if you are experiencing delays when using it, call us toll-free at the number above or send us a message. However, please keep in mind that FCAC does not provide redress or compensation and that we cannot get involved in individual disputes.

Click here to learn more about how we handle complaints.
 

Making a complaint—Payment card network operator

Click here to find the complaint-handling process for your financial institution 

If, as a merchant, you have a complaint or a problem with a payment card network operator, you can take the following steps to resolve it.

Step 1: Acquirer

First, you should try to resolve the problem directly with your acquirer—the payment card processor.

Step 2: Payment card network operator

If your complaint cannot be resolved with the acquirer, it may be referred to the payment card network operator.

FCAC

FCAC will monitor the payment card networks’ compliance with the Code of Conduct for the Credit and Debit Card Industry in Canada. However, please remember that FCAC does not provide redress or compensation and that we cannot get involved in individual disputes.
 

How FCAC handles your complaint

What types of complaints does FCAC deal with?

Federally regulated financial institutions have certain legal obligations to consumers, ranging from account-opening requirements to information they must provide you. At FCAC, we investigate complaints that relate to a possible violation of these legal obligations.

FCAC has responsibility under the Code of Conduct for the Credit and Debit Card Industry in Canada to monitor issues raised by merchants and work with payment card network operator to resolve them. Please see “Merchant questions and dispute resolution” to learn more.

What is FCAC’s role in handling complaints?

We determine the nature of a complaint and, when there is a breach of the law, code of conduct or public commitment, we take action to ensure compliance by the federally regulated financial entity. We do not provide personal redress (i.e., compensation or monetary award). Our focus is on making sure that federally regulated financial entities comply with their legislative obligations.

Who can file a complaint and how?

Any consumer can file a complaint with FCAC, and there’s no cost involved. Call us toll-free at 1-866-461-3222 or send us a message.

Are there matters that FCAC cannot investigate?

We do not handle complaints involving:

  • the pricing of products (e.g., insurance premiums, service fees, credit card charges)
  • the quality of service you received
  • loan and credit granting policies
  • billing errors
  • other general service issues.

These matters are determined by a financial entity’s policies. You should deal directly with your federally regulated financial entity by using its complaint-handling process, which may include an external complaints body. If you have difficulty finding out about your federally regulated financial entity’s complaint-handling process or experience problems using it, we want to know.

If you don’t know the complaint handling process for your financial institution, click here or you can call us toll-free at 1-866-461-3222 and we will be pleased to provide you with the process.

Is FCAC responsible for all financial entities?

As an agency of the federal government, we investigate complaints about financial entities under federal jurisdiction. These entities include all banks and all federally incorporated or registered insurance, trust and loan companies, retail associations, federal credit unions and payment card network operators. FCAC is not responsible for provincially regulated credit unions, finance companies, mutual fund dealers, securities dealers or other financial entities that fall under provincial jurisdiction. For a listing of provincial regulators, click here.

Is there anything I should do before contacting FCAC?

You must try to resolve your complaint directly with the financial entity. Keep in mind that FCAC does not resolve complaints, nor is it mandated to provide redress or compensation. In order to resolve your complaint, you must file your complaint with the financial entity by following its complaint-handling process.

When contacting FCAC, make sure you have all the facts on hand. This information will assist us in determining whether your complaint involves a possible breach of federal legislation.

How will FCAC handle my complaint?

We will ask for details about your complaint, assess whether it involves a possible breach of the law, code of conduct or public commitment, or determine whether it may fall within the jurisdiction of another government department or agency.

We will investigate to determine whether the federally regulated financial entity has respected its obligations, including whether there has been a possible violation of a consumer provision or regulation, or a failure to comply with a public commitment or code of conduct. FCAC has the authority to impose a number of compliance measures, including monetary penalties, but cannot offer—or require the institution to offer—redress or compensation. To seek redress or compensation, you will have to go through your federally regulated financial entity’s complaint-handling process, which may include an internal ombudsman or an external complaints body.

As part of the investigation process, an FCAC compliance officer will contact your financial entity to discuss your complaint. If the compliance aspect of your complaint is not clear or cannot immediately be resolved with the financial entity, FCAC may request additional information in writing from you. The compliance officer may also request additional information from the financial entity.

Once the formal investigation is complete, our response will depend on our findings. In cases of non-compliance with the law, we may impose a number of compliance measures or issue a Notice of Violation to the financial entity and impose a monetary penalty. We may also publicize details of a violation, including the name of the financial entity that committed it and the amount of the penalty imposed.

Why is FCAC interested in my complaint?

When we are alerted to potential violations, we can take steps to ensure compliance. We also report to Parliament on the types of complaints we receive and the performance of federally regulated financial entities in meeting their legal obligations. This information is released to the media and other interested parties. In addition, your complaint will help us analyze and report on trends in customer service issues for the financial industry.

Where can I get more information?

Call us toll-free at 1-866-461-3222. You can learn more about the consumer obligations of federally regulated financial entities on Your rights and responsiblities.
 

Before you sign any contract: 10 things you need to know

Rate this tip sheet

PDF version (200 KB, 4 pages)Pen loosing ink 

10 things you need to know

You’ve decided to get that cell phone, credit card, or gym membership but do you know exactly what you are getting into? Before you sign any contract, here are 10 things you need to know.

  1. Shop around!
    Understand exactly what each company is offering. The more you know, the more you can negotiate. Compare price, guarantee or warranty, duration of contract and any other terms or conditions that are important to you.
     
  2. Know who you’re dealing with
    Reputation is important, so ask friends or family for references. If you are not sure about a company’s reputation, check with the Better Business Bureau or investigate a company online at www.bbb.org.
     
  3. Negotiate!
    Most contracts can be negotiated. Use the information you gathered while shopping around to get the best service and price. If the company or individual wants your business, they will listen to your arguments. Don’t feel pressured to sign immediately—this is your decision to make!
     
  4. Read the contract and pay attention to the details
    Don’t rely on verbal promises; make sure any agreements or claims made by the salesperson are written into the contract. Strike out elements you do not want to agree with, and have these changes initialled by you and the salesperson before you sign. Fill all blank spaces so that details cannot be added later by the salesperson.
     
  5. Understand everything in the contract
    Ask the salesperson questions and get advice from someone knowledgeable if there are elements you don’t understand. And don’t forget the fine print; it is part of the contract too! If you feel you need to, have a lawyer review the contract.
     
  6. Know who to call for help or to lodge a complaint
    Ask the salesperson for a customer service phone number and the steps to take if you need to make a complaint.
     
  7. Remember: you are responsible
    A signed contract is a legal document, so you will have to live with what you agreed to. Generally, a contract cannot be changed or broken unless you and the other party both agree (see next tip).
     
  8. Know how to get out of it
    Usually, a short period of time is allowed to cancel a contract without penalty; it’s called the “cooling off period” and it should be described in the contract. Even if it isn’t, you could still have a cooling off period, so check with the Consumer Protection Act of your province or territory. Otherwise, to cancel a contract before it is over, both parties have to agree and most of the time, it will cost you!
     
  9. Sleep on it!
    Is this what you really need and want? It’s OK to change your mind before signing or agreeing to a contract.
     
  10. Once it’s signed, get a copy and keep it
    You may need it later on for reference, or to launch a complaint if you have a problem.

For more information

For more information on contracts, visit the FCAC website, www.fcac.gc.ca.

Other FCAC information of interest

Tip sheets

Publications and interactive tools



Be smart with your credit card: Tips to help you use your credit card wisely

Rate this tip sheet

Credit cards can be useful and convenient. But if you aren’t careful about how you use them, you can put yourself on a path to serious financial trouble. You could build up debt that might take you years to pay off or damage your credit rating.

Before applying for a credit card:

1. Know what you’re getting into. When you sign up for a credit card, you are entering into a legally binding contract, so it’s important that you understand the terms and conditions.

Credit card applications from federally regulated financial institutions must have an “information box” that outlines key features of the credit card like interest rates and fees. But don’t stop reading there. Review the complete terms and conditions so you’re aware of other important details, such as:

  • your PIN and your liability in case your card is lost or stolen
  • who is liable if you share the card with a “joint borrower” or “secondary user”
  • any restrictions and limitations on reward programs and benefits
  • how to cancel the card.

2. Know yourself and your spending habits. Before you start shopping around for a credit card, think about how you will use it and set some guidelines for yourself. A credit card doesn’t increase the amount of money you have available to spend. Continue to live within your means and your budget.

3. Limit the number of credit cards you apply for. Every time you apply for a credit card, it’s recorded by the credit reporting agencies. Applying for too much credit can damage your credit rating by creating the impression that you may be relying too heavily on credit.

When you have a credit card:   

1. Avoid impulse buys, especially if you don’t have the money available in your bank account to pay for the item. Ask yourself if you really need to make that purchase right away (or at all), or if it can wait until you have the money to pay for it.

2. Aim to pay off your balance in full by the due date every month. Carrying a balance means that everything you charge to your credit card actually costs you more than the purchase price, because you are paying interest.

For example, if you buy a new flat screen TV for $1,000 and pay only the minimum each month, it will take you almost 11 years to pay it off in full and it will have cost you $1,989 ($989 in interest)—almost twice the actual price of the TV.

3. If you have to carry a balance, try to make payments as soon as you can to reduce your costs, because interest is charged daily. And always try to pay more than the minimum amount owing.

Credit card statements for cards issued by federally regulated financial institutions have to include an estimate of how long it would take you to pay off your current balance if you were to only make the minimum payment each month and didn’t charge anything else to your credit card. You may be surprised at how long it would take you to pay off a splurge.

4. Make regular payments to help build a good credit history. Paying the balance in full every month will show other lenders that you are a responsible borrower. On the other hand, if you make payments late or miss them entirely, you hurt your credit score.

5. If your monthly balance is growing, stop using your credit card until you get your finances under control. Use cash instead of a credit card. Look at your budget for ways to trim your spending.

6. Avoid taking cash advances on your credit card. You are charged interest from the day you take the advance until the day you repay the entire amount, and unlike regular credit card purchases, there is no grace period on cash advances from a credit card.

Instead, use your debit card to get cash from own financial institution’s ABM, or use the “cash-back” option that some merchants offer when you pay with debit. If you don’t have enough money in your account, look at your budget to see where you can trim your spending.

7. Every month, carefully check your credit card statement to make sure that there are no errors. It’s a good idea to keep receipts for all of your credit card purchases so that you can verify the amounts against your statement. If you find an error, report it to your credit card issuer right away.

8. If your credit card has a rewards program, avoid increasing your spending or buying things you don’t need just to get points.

9. If unexpected expenses come up, talk to your financial institution about your options. There may be alternatives to using your credit card that will cost less in interest, such as a line of credit.

10. Keep your card, your PIN, and your security code secure. If you share your PIN or security code, you risk being held financially responsible for unauthorized transactions.

Other FCAC information of interest


How to beat that debt

Rate this tip sheet

 

Have you lost control of your finances? How can you beat that debt? Here are ten things you can do to help your situation.

Plan your spending according to your income

1. Keep track of spending and make a budget

One of the smartest things you can do to get control of your finances is to start keeping track of what you spend so that you can see exactly where your money is going each month. This is the first step in creating a budget that shows your income and expenses.

Having a budget and learning to stick to it will help you free up money to reduce your debt. For more information on budgeting, see FCAC’s tip sheet called Making a budget and sticking to it, which explains how to make and keep a budget and includes a budget worksheet.

2. Put needs before wants

Buy what you need first. Eliminate unnecessary expenses and look for things you can live without.

Don’t get into more debt

3. Keep your credit card in your wallet

To avoid getting into more debt, use cash or your debit card instead of your credit card. That way, you’ll be spending money you already have.

4. Avoid “Buy now, pay later” offers

When you’re having problems making ends meet, the administrative fees tied to such offers and high interest rates if you don’t pay on time will only add to your existing debt load.

5. Reduce small, recurring expenses

Saving a little every day can go a long way. Good examples of ways you can save on costs include taking public transit instead of your car, bringing your lunch to work and reducing your coffee consumption. Eliminating that extra $1.50 coffee each workday can mean over $400 a year in savings.

6. Reduce your banking fees

Use automated banking machines (ABMs) from your own financial institution. Review your banking package every now and then to make sure that it is still the best one for you. For more information, see FCAC’s Cost of banking guide interactive tool, which lists ABM fees and helps you compare and choose the best banking package for your needs.

Manage your existing debt

7. Pay down your highest interest rate debts first

If you carry a balance on your credit card, then this is likely the debt with the highest interest rate. Use cash or a debit card while you pay off this debt to avoid accumulating more.

While you pay off the credit card debt, don’t forget to make the minimum payments on other debts with lower interest rates. If you set aside the main part of your income towards bringing the balance down on your most expensive loan, you’ll be surprised at how much you save.

8. Contact your creditors

As soon as you realize that you are having trouble making ends meet, call your creditors and explain the situation. In most cases, they will work out a modified payment plan that will make it easier for you to pay off your debt.

9. Get a consolidation loan with your financial institution

This means getting one single loan to pay off all your existing debts so that you have just one payment to make. For this new loan to save you money, it must have a lower interest rate and a lower monthly payment than all the other loans put together. It is also important to stop using any credit cards that you consolidated into the new loan. For more information on a consolidation loan, talk to your bank or financial professional.

10. Talk to trusted financial professionals

These may include your bank representative, your financial planner or a credit counselling agency. With their help, you will be able to evaluate your current debt situation, determine your present and future needs, make a budget and find ways to pay off the debt. For more information on credit counselling agencies, see FCAC’s Tips for dealing with credit counselling agencies.
 

Do you cringe when you hear the word “budget”? Sure, a budget involves a bit of work on your part, but the payoff is financial discipline and peace of mind. Once you get the hang of it, budgeting is easy and can mean a better financial future for yourself and your loved ones.

What is a budget?

A budget is a written document or electronic file that helps you take control of your personal finances. It is an excellent money management tool that helps you achieve your financial goals. It is especially important if:

  • you find that money is tight
  • you don’t know where your money is going
  • you have problems paying off your debt
  • you don’t save regularly
  • you want to find ways to make your dollar stretch further.

A budget helps you see more clearly how much money you receive, and how much you spend and save. It helps you set spending limits and live within your means. It helps you find ways to get rid of your debts, reduce costs and have more money for things that are really important to you.

You can see what a budget looks like by going to the Budget Calculator tool on the Financial Consumer Agency (FCAC) website or going to the Budget Worksheet provided in this tip sheet. This document will help you fill out the Budget Worksheet and understand how to use it. More importantly, it will show you how to stick to your budget.

Before you start making a budget

Think about your goals

Before you start making a budget, take some time to think about your financial goals. Do you need to pay off your debts? Do you want to save to buy a home or begin building your nest egg for retirement? Do you want to go back to school or send your kids to school?

Keep track of your money

Most people know how much money they make (income). But do you know where your money is going (expenses)? This exercise will help you achieve just that. Every dollar you spend has an impact on the overall picture.

Every day, for a month or two, keep track of everything you buy, from groceries to your daily cup of coffee. Keep a copy of bills you pay during that time, and write down what you buy in a notepad or keep your receipts. Doing this will help you understand your spending habits and make a budget.

Making your budget

To help you make your budget, FCAC has developed an online Budget Calculator that does the math for you. You can also use the Budget Worksheet provided in this tip sheet.

How to use the Budget Worksheet


Step How to use the Budget Worksheet

Step 1:
List your previous income and expenses

FILL OUT COLUMN A (Previous months)

  • Take out the recent pay stubs, bills and receipts you collected over the previous month(s).
  • Separate your income and expenses in the categories listed. For each category, if you have collected data for more than one month, take the average. Add any missing categories under “Other” in each section.

When you are done, review the figures and ask yourself:

  • Did I miss any income or expenses?
  • In the “Basic expenses (Needs)” and “Other Expenses (Wants)” sections, are there any other categories missing to reflect my personal situation?
  • Are there categories in the “Basic expenses (Needs)” that fit better in the “Other expenses (Wants),” or vice-versa, to reflect my personal situation?
  • Was I able to save any money, or did I have to borrow (such as adding money to a credit card balance) to make ends meet?

Step 2:
Create a balanced budget

Creating a budget means looking at your past expenses and creating an improved version that reflects your financial goals. A balanced budget is when income exceeds expenses—that is, you are able to save a bit of money each month. This is the ideal scenario. Your budget is what will guide your spending in future months and help you save money.

FILL OUT COLUMN B (Budget)

  • Use Column A to guide you, but adjust the figures as you go along, while you think of the following:
    • Do the figures in Column A reflect my expenses in any given month? If not, what would be a more realistic figure?
    • Are there any small, recurring expenses that I can cut?
    • Are there expenses in the “Wants” categories that I can cut?
    • Do I want to add money to certain new spending categories that reflect my financial goals, such as saving for a vacation or creating an emergency fund?

Once you are done, take total income and deduct total expenses to find out how much money you will be able to save. Adjust your expenses where you can so that your monthly savings help you meet your goals for the future.

Step 3:
Use your budget each month

This is the most important step in the budget process. Each month, limit your spending as much as possible to what was in your worksheet. Keep receipts, bills and lists of your income and expenses.

FILL OUT COLUMN C (Actual spending) at the end of each month (you may want to make extra copies of the Budget Worksheet for this purpose) using the data you collected during the month.

FILL OUT COLUMN D (Difference between Actual spending and Budget)

  • To help you figure out whether your spending for the month was in line with your budget, fill out Column D.
  • Look at the results of Column D and ask yourself the following questions:
    • Are the differences between my actual spending and my budget large or small?
    • In which categories are the differences the largest? Why? Is it because of an unusual situation or is this likely to happen each month?
    • Am I able to save enough money to reach my financial goals or to pay off my debts? 

Continue with this exercise each month. Many people make this a regular habit at the end of each month.

Learning to stick to your budget

Learning to stick to a budget can seem difficult at first, but the more you use your budget, the easier it becomes.

Evaluate your budget from time to time

If you find that your actual spending varies a lot from your budget, you will have to readjust the figures in your budget to make it more realistic. In this case, go back to Step 2 and reduce some expenses, or restrict your spending in some categories.

If your actual spending varies only a little from your budget, you are on the right track.

If you are not saving enough or are not able pay off your debts, find other ways to cut down on expenses and adjust your budget accordingly.

Keep up the good work! If you can stick to your budget closely, you should find that your income covers your expenses and that you are saving enough for your financial goals.

Budget Worksheet


  COLUMN A
Previous months
($)
COLUMN B
Budget
($)
COLUMN C
Actual spending
($)
COLUMN D Difference
(B - C)
($)
INCOME
Salary or benefits        
Canada Child Tax Benefit (CCTB)        
Other        
TOTAL INCOME        

BASIC EXPENSES (NEEDS)
HOME
Rent or mortgage payment
       
Property taxes/condo fees
       
Home insurance
       
Utilities (electricity, water, cable and/or telephone)
       
Repairs and maintenance
       
TRANSPORTATION
Public transportation
       
Car loan payment
       
Car repairs, gas, etc.
       
Car insurance/registration, etc.
       
LIVING EXPENSES
Groceries
       
Child care
       
Medical and dental
       
Outstanding loan payments
       
Basic clothing
       
Life, disability and medical insurance
       
Emergency fund
       
Other
       
OTHER EXPENSES (WANTS)
Restaurants and entertainment
       
Clothing (extra)
       
Hair care
       
Gifts
       
Vacations
       
Other
       
TOTAL EXPENSES        

SAVINGS TO REACH GOALS (Total income minus total expenses)
       

Prepaid cards and other prepaid products have become popular as an alternative way to pay for purchases, to give as gifts or to use online or when travelling. Whether physical or electronic, these products are—or can be—loaded with funds that can be used by the cardholder to make withdrawals or purchase goods or services. While prepaid products offer several benefits, they have costs and conditions that you should be aware of.

What types of prepaid products are there?

Prepaid cards and products require you to pay up front to “load” money on to a card for later use. They are sometimes referred to as “gift cards.”  Some are for single use, while others are reloadable, meaning you can add more funds to them.

 

  • Prepaid cards for specific retailers can only be used at a single store or group of stores, such as a chain. 
  • Prepaid cards branded with a payment card network operator’s logo, such as American Express, MasterCard or Visa, can be used at most merchants that display that network’s logo.
  • Prepaid promotional products are purchased by an organization and distributed as part of a promotional, loyalty or award program. The funds on the card are often available for a limited time and may be subject to maintenance fees.

10 questions to ask to make sure that you are well informed

1 What kind of regulations apply to the prepaid card?

Answer:

The Prepaid Payment Products Regulations cover prepaid cards and other prepaid payment products issued by federally regulated financial institutions, including banks. These products are preloaded with funds that can be used to make purchases or cash withdrawals via a payment network such as American Express, MasterCard or Visa. Under the federal Prepaid Payment Products Regulations, consumers must be provided with key information related to the card or product.

The Regulations do not apply to retailer-issued gift cards or to prepaid cards and products issued by provincially regulated institutions. Every province and territory has one or more bodies to regulate financial institutions under provincial responsibility. These institutions include credit unions and caisses populaires, as well as other financial institutions that are registered or incorporated at the provincial level. A list of provincial and territorial regulators is available on FCAC's website.

You can also check with the consumer protection office in your province or territory to find out whether your province or territory has gift card legislation, and how it applies to retailer-issued prepaid cards.

2 Does the prepaid card have an activation fee?

Answer:

Some prepaid cards charge an activation fee or purchase fee before you can use them. The activation fee is charged only once and is not refundable. Activation fees vary; they can be a preset flat fee or they can depend on the card’s value.

For example, if a $50 prepaid card has an activation fee of $4.95, you are paying almost 10 percent of the card’s value just to use it.

3 Are the fees, terms and conditions acceptable to you?

Answer:

If the card or product is issued by a federally regulated financial institution, key information, including fees, must be available to you where prepaid cards are sold, on the prepaid card packaging and on the card issuer’s website. The Regulations do not apply to prepaid cards and products issued by provincially regulated institutions.

Before you commit to buying the card, read the information in the prepaid card agreement carefully.

If you are buying the prepaid card as a gift, be sure to provide this information and the proof of purchase to the recipient along with the card.

4 Does the prepaid card have an expiry date?

Answer:

Federally regulated financial institutions that issue prepaid cards or products are not allowed to set an expiry date on the funds loaded onto them (except for promotional cards and products distributed by a company as part of a promotional, loyalty or award program).

Is there an expiry date on the card itself? Ask whether a new card can be issued upon expiry of the original card. Check whether there is a fee to issue a replacement card.

5 What kinds of fees apply to prepaid cards?

Answer:

Depending on the features of your prepaid card, you can be charged fees to:

  • check your balance
  • withdraw money from automated banking machines (ABMs)
  • replace the card
  • customize it
  • load more money onto it
  • make purchases
  • cover overdraft
  • cover monthly maintenance or dormancy if the card is not used for a certain period of time.

It is important to review the card’s terms and conditions to see whether and when any of these fees apply.

If your prepaid card or product was issued by a federally regulated financial institution:

  • the institution cannot charge maintenance fees for at least one year after activation, unless the card is:
    • a promotional product
    • reloadable and you have given your express consent to be charged maintenance fees
  • the institution cannot charge overdraft fees or interest unless you give your express consent.

Fees can quickly reduce the original value of the card, decreasing your buying power.

6 What happens if the prepaid card is lost or stolen?

Answer:

When you report a card lost or stolen, the card issuer may be able to transfer any money left on the card to a new card; check whether a fee would apply. In other cases, you could be out of pocket just as though you had lost cash. Check your prepaid card agreement for details.

Beware of prepaid card fraud:

Be cautious about buying prepaid cards that are easily accessible where they are sold, as fraudsters sometimes copy card numbers and PINs or security codes, and use them once the prepaid card is activated.

If you buy a prepaid card that is offered for resale, make sure you buy it from a trusted source to limit the risk that it is counterfeit or compromised.

7 How do you find your prepaid card balance?

Answer:

Most prepaid cards offer several ways to find your balance, including online, telephone, mobile phone and in-store inquiries. Check whether there are any fees to make a card balance inquiry.

Tip:
Keep your receipts to help you track your card balance and in case you ever want to a dispute a charge.

8 Can you cancel the prepaid card?

Answer:

Find out what happens if you or the gift card recipient decides to cancel the card.

Some card issuers will allow you to cancel the card for a fee, which they deduct from the remaining balance before you receive any money back.

Check the prepaid card’s terms and conditions for more details.

 

9 Where can you use your prepaid card?

Answer:

Before buying, find out whether the places where you are likely to shop will accept the card. If you plan to use the card for online purchases or outside of Canada, confirm with the prepaid card issuer whether you will be able to do so.

If you plan to use the card when travelling, you should know that hotels, car rental agencies or pay-at-the-pump gas stations may put temporary holds on the funds on your prepaid card. Restaurants or other businesses may cover tips by adding an extra charge to the funds taken from the prepaid card.

10 Would another form of payment be better?

Answer:

Use the payment option that gives you the benefits you want at a cost you can accept. Compare fees and benefits for using cash, prepaid cards, debit cards and credit cards, and decide which option works best for your own use or as a gift.

Other FCAC information of interest


Your rights under the Prepaid Payment Products Regulations  

New federal regulations dealing with prepaid cards and other prepaid products will come into force on May 1, 2014.

Under the federal Prepaid Payment Products Regulations, consumers must be provided key information related to prepaid cards and other prepaid products. The Regulations do not apply to prepaid products issued by provincially regulated institutions or retailers. 

The Regulations cover prepaid payment products issued by federally regulated financial institutions (FRFIs), including banks. These products are preloaded with funds which can be used to make purchases or cash withdrawals through a payment network such as American Express, MasterCard or Visa. Prepaid cards and products are available through federally regulated financial institutions, online, by telephone or at retail commercial outlets.

Expiry dates

FRFIs that issue prepaid cards or products may not set an expiry date on the funds loaded onto them. The product itself can have an expiry date. There may be a fee to transfer the funds and to issue a new card.

Promotional cards and products distributed by a company as part of a promotional, loyalty or award program may have an expiry date on the funds. This expiry date must be shown on the product.

Your right to receive information 

 The Regulations require issuers to provide certain information to consumers:

  • before issuing the card or product
  • when the card or product is issued
  • directly on the card or product. 

This information must be provided in a manner that is clear, simple and not misleading.

Information required before issuing the card or product 

The Regulations require that the product’s exterior packaging prominently display an information box disclosing the fees. If the consumer applies for the card or product by telephone, the fees must be disclosed verbally. 

This information includes:

  • the name of the issuing institution
  • a toll-free telephone number to make inquiries about the terms and conditions
  • restrictions on the use of the product
  • all fees that may apply
  • a statement that the funds are not insured by the Canada Deposit Insurance Corporation (when that is the case)
  • information about fund expiry dates. 

Information required when the card or product is issued

When the card or product is issued, the Regulations require that consumers be provided with written information, including:

  • all fees and charges that may apply
  • the terms and conditions of use of the card or product, including consumers’ rights and responsibilities related to a lost or stolen card or product
  • a description of how consumers can verify the balance of the funds loaded onto the card or product
  • a description of how consumers may, in certain circumstances, use funds loaded on the product toward partial payment of a purchase
  • all of the information required before issuing the prepaid card or product (except when a prepaid card or product is issued in person and the information was disclosed before issuing it).  

Information required on the card or product

The following information must be set out directly on the prepaid card or product, or if the product is electronic, by disclosing it electronically at the consumer’s request. This includes, but is not limited to:

  • the name of the issuing institution
  • the date on which the funds on the prepaid payment product will expire (allowed only on promotional products)
  • a toll-free telephone number that can be used to make inquiries about the card, including balance inquiries and complaints
  • a website where consumers can get more information about fees, restrictions and other terms and conditions.

What issuing institutions are not allowed to do

Fee changes

Institutions that issue prepaid cards or products to consumers are not allowed to increase fees or introduce new fees unless:
  • the cardholders provide the institution their names and mailing or email addresses, and have the opportunity to change this information
  • the institution discloses the new or increased fee by:
    • sending a notice to the most recent address provided at least 30 days before the new or increased fee takes effect, and 
    • displaying a notice on its website for at least 60 days before the new or increased fee takes effect. 

Use of funds

Institutions are not allowed to set an expiry date on the funds loaded onto a prepaid card or product (except for promotional cards and products). The expiry date on promotional products must be indicated on the card and in a statement before the product is issued.

Maintenance fees

A maintenance fee is a type of fee that can be charged after the prepaid card or product has been purchased, but that is not associated with the cardholder’s use of the product or any service related to it. Institutions are not allowed to charge maintenance fees for at least one year after the prepaid card or product is activated unless it is:

  • a promotional product
  • a reloadable card or product (which lets the cardholder add more funds) and the cardholder has given express consent to be charged maintenance fees.

Overdraft

Institutions are not allowed to charge overdraft fees or interest for prepaid cards or products unless the cardholder gives express consent.   

Implementation of the Regulations

FCAC is responsible for overseeing compliance with the Prepaid Payment Products Regulations and is working with federally regulated financial institutions that offer prepaid payment cards to ensure that the new requirements are fully implemented.

These institutions have all indicated that the Prepaid Payment Products Regulations will apply to all prepaid cards in the market on May 1, 2014, regardless of when the card was purchased.

For example, if a consumer purchased a non-promotional prepaid card in January 2013 and the card had an expiry date of June 2014, the expiry date on the funds will no longer be in effect.

What you should do if you feel your rights are not being respected 

If you feel that a federally regulated financial institution is not respecting your rights, contact FCAC.

Prepaid Payment Products Regulations

 

Managing debt: Getting help from a credit counselling agency

Rate this tip sheet

What are credit counselling agencies?

Credit counselling agencies provide a range of services for people in financial difficulty. One of the most common services they offer is help with finding the best strategy to pay off your debt through a debt management program.

Credit counselling agencies can also offer you one-on-one counselling, group courses and seminars on topics such as:

  • how to make budget and stick to it
  • how to use credit wisely
  • how to improve your credit report and credit score.

You may have to pay fees to a credit counselling agency for their services. The amount of these fees varies from agency to agency. Before you use their services, do some research to make sure you know what costs are involved and what services you will receive.

Provincial and territorial governments are responsible for regulating credit counselling agencies and investigating consumer complaints.

Debt management programs

A debt management program is designed to help you pay off your debt. Once you are enrolled in such a program, a credit counsellor will contact the companies to which you owe money (called your creditors), and ask for their cooperation. Creditors usually agree to cooperate in putting your debt management plan to work. In some cases, your creditors may agree to reduce or eliminate the interest rate and/or fees on your debts.

To sign up for a debt management program, you will usually have to sign a contract with the agency. The contract will say that you will make regular payments to the agency. The agency will use those payments to pay off your creditors according to the plan.

It is important to understand that not all types of debt are covered by this type of program. For example, secured debts (those guaranteed with an asset, like a car loan or a mortgage), are generally not covered because the asset that secures the loan can be repossessed by the creditor if you don’t make the required payments. Make sure that any credit counsellor explains exactly which of your debts the program will cover.

Entering into a debt management program is completely voluntary. You should not feel pressured to participate without considering all of the implications.

What happens to my credit report?

A credit report is a snapshot of your credit history. It lists your debts with your creditors. Your creditors send this information on a regular basis to credit reporting agencies to show whether or not you are making your payments on time.

While you are on a debt management program, there will be a note on your credit report to show that you are making regular payments to creditors through a special arrangement with your credit counsellor. During this time, you will usually not have access to more credit.

After you have completed your debt management program, you will be able to access credit again. However, for the next two or three years, your credit report will indicate that you used the services of a credit counselling agency to help repay your debts. During this period, if you give creditors, landlords or employers permission to access and view your credit report, they will also see this information.

For more information on credit reports and credit history, see FCAC’s publication Understanding your credit report and credit score.

Know your options

Before you seek the services of a credit counsellor:

  • Discuss your financial situation directly with your creditors and with your financial institution. They may be able to offer you a lower interest rate product or offer to consolidate your debts into one loan instead of several.
  • Seek advice from reputable sources, such as financial advisors, trustees in bankruptcy or insolvency lawyers. They may suggest that you explore other community and professional services before making a final decision.

Find a reputable credit counselling agency

If you’ve considered your options and you think you could benefit from the services of a credit counselling agency, do your research to find a reputable organization and a qualified counsellor. Here are some helpful ways to help you find a reputable credit counselling agency and counsellor:

Look carefully at the company’s advertising

  • Beware of any agencies who claim they can fix credit or repair your credit report. It’s impossible for them to change or erase accurate information in your credit report. The only way to improve your credit rating is to show your creditors that your payment habits have improved and you are being responsible with paying back your debt.
  • Be very cautious about companies that claim that they can negotiate a deal with your creditors so that you will only have to pay part of your debt. This process is often called “debt settlement” or “debt negotiation.” Be aware that some companies may misrepresent the services they offer as being part of a government program. This is not accurate.

    Some companies promoting debt settlement as your best option may tell you that they can solve your debt problems quickly and that you will pay less than half of what you owe. If it sounds too good to be true, it probably is. Don’t sign anything or agree to any service of this type before researching the company and checking with sources you trust. You provincial or territorial government’s office that deals with consumer affairs is a good place to start.

Find out about the credit counselling agency’s reputation and qualifications

Ask about counsellor qualifications

  • Credit counsellors are not legally required to have any specialized training, but many credit counsellors have some. Be sure to ask about counsellor’s qualifications, including education, specialized training and years of experience.

Find out about services and costs

The services that credit counselling agencies offer can vary greatly and so can the costs. Here are some questions you can ask to help you find an agency that is right for you.

Services

  • Is the first consultation free?
  • What services does the agency provide?
  • Will the agency provide a proposal in writing describing how they will help you personally?
  • What type of support does the agency give to help you learn better money management?
  • Do they provide you with monthly statements of payments?

Costs

  • Which of the following fees do they charge when you enter a debt management program:
    • initial set-up fee
    • monthly maintenance fee
    • application fee
    • membership fee
    • upfront fee or fee for each creditor?
  • Will they reduce or eliminate fees if you cannot afford to pay them?

If the credit counselling agency seems to meet your needs, ask to meet with a credit counsellor so you can see if there is a good fit. Any reputable credit counselling agency will not charge for this.

Other things to consider

Here are some other key things to think about if you are considering getting help from a credit counselling agency:

Comfort level with the credit counsellor

Make sure you are comfortable with the counsellor and that you trust his or her opinion and judgement. If you are not comfortable with the person assigned to you, ask if there is another counsellor that can help you with your situation.

Easy-to-understand contracts

  • A contract for a debt management program should clearly state how much you will pay in fees, when the agency will process your payments, what your responsibilities are and what you can expect from the agency.
  • You should also know what will happen if your financial circumstances change and you can no longer make payments.
  • Carefully read and fully understand the contract before you sign it, and ask questions if you don’t understand any of the terms and conditions. Make sure you have your own copy of the contract to keep.

While on a debt management plan

Your creditors may help you reduce your debt by giving you a lower interest rate—which will save you money. But the agency may charge you for its services. Compare the agency’s fees with what you would save in interest if you were on the debt management plan. If the agency’s fees are more than what you can save, you could be better off seeking help from other sources.

Monitor your payments and progress

  • Ask the agency for regular written status reports (such as every month or two). Your creditors may stop sending you monthly statements for your debts while you are on the debt management plan. If you still receive statements, review them carefully to make sure that the agency is paying your creditors on time, and to avoid any late fees or negative entries on your credit report.
  • To monitor your progress, you can order a free copy of your credit report from time to time. You can order a free copy of your credit report from the credit reporting agencies, Equifax Canada and TransUnion Canada. This will give you the opportunity to review the information it contains to make sure it is accurate.
  • Report any errors or missing information to the credit reporting agency and insist they be corrected immediately.

Where are credit counselling services available?

Provincial governments, not-for-profit organizations and for-profit companies all offer credit counselling services. For a list of some of the services available across Canada, visit the these websites:

Other FCAC information of interest

Overview

Credit cards can be very convenient, but it’s important to keep in mind that when you apply for a credit card, you are entering into a contract. Like any contract, it is legally binding and gives each party certain rights and responsibilities.

There are rules that federally regulated financial institutions have to follow to make it easier for you to understand the terms of your credit card contract. This publication will give you a brief overview of some of those rules.

Note: In this publication, the term “credit card issuer” refers to a federally regulated financial institution. 


What are federally regulated financial institutions? 

Federally regulated financial institutions include

  • all banks

and all federally incorporated or registered

  • insurance companies
  • trust companies
  • loan companies
  • co-operative credit associations

that carry on business in Canada.

For a list of federally regulated financial institutions, visit the website of the Office of the Superintendent of Financial Institutions (OSFI) and click on “Who We Regulate.”


 

Your right to information

When you apply for a credit card

Any time you receive a credit card application from a credit card issuer, you have the right to certain information. Key features of the card agreement, such as the card’s interest rates, fees and other charges, must be clearly set out in an information box at either the beginning of the application or a related document that you receive at the same time. For more information, you can see an example of an information box.

When you apply for a credit card, you agree to accept all of the terms and conditions, including interest rates and fees. Read the entire application carefully before submitting it.

When you get your credit card

When your credit card arrives, it must have a credit card agreement or contract with it. You should read the agreement carefully to understand your responsibilities and the terms and conditions of using the card. Keep the agreement for your records. If there is something you do not understand, contact your credit card issuer.

Similar to the credit card application, your credit card agreement also has to have an information box that clearly outlines key information. This information box may be at the beginning of either the agreement or a related document that you receive at the same time.

With your monthly credit card statement

Once you have your credit card, your issuer has to send you a statement every month. Your credit card issuer may provide you with a written statement or an electronic statement, if you consent to receive required information in electronic format rather than as paper documents. The statement must include the following information:

  • your outstanding balance (you have to pay this amount in full by the due date to benefit from the interest-free grace period on new purchases)
  • an estimate of the length of time it would take to pay off the balance in full if you paid only the minimum amount required each month
  • a description of each transaction made during the period covered by the statement, and the amount charged, including interest
  • the date each transaction was posted to your account
  • the amount credited or charged during that month for each of the following:
    • purchases made
    • cash advances received
    • payments made
    • interest charged
    • non-interest fees charged.

Exceptions:

Your credit card issuer does not have to send you a monthly statement if:

  • there is no outstanding balance at the end of the period
  • you have defaulted on your payments and the issuer has notified you that the credit agreement has been suspended or cancelled.

Also, your credit card issuer can send you a statement only every three months if the following three conditions are met:

  • there have been no charges or payments
  • the outstanding balance is less than $10
  • no fee or interest is being charged or accumulated.

When your credit agreement changes

If your credit card issuer changes any features or any of the terms or conditions of your credit card, the issuer has to give you the details of these changes in writing at least 30 days before the changes go into effect. Your credit card issuer may provide this information to you in writing, or electronically if you consent to receive required information in electronic format rather than as paper documents.

Your credit card issuer also has to get your permission before raising your credit limit. If you agree verbally to an increase, your credit card issuer has to confirm the change in writing no later than your next credit card statement.

Exceptions:

There are some changes to the terms and conditions of your credit card for which advance notice is not required. However, the changes have to be disclosed to you in the next statement you receive after the change is made. These changes are:

  • an extension of your grace period
  • a decrease in the interest rate
  • a decrease in a charge that is not related to the interest rate
  • a decrease in your credit limit
  • a change to any optional service you accepted
  • if you have a card with a variable interest rate, the change in the benchmark rate or base rate to which it is linked (also known as the reference rate).

Example: information box for a credit card

(Note: Details shown in this example, such as interest rates, will vary by credit card.)

Initial credit limit $5,000
Annual interest rate or rates

These interest rates are in effect the day your account is activated.

Promotional rate on purchases: 4.99% for your first three monthly statements
Purchases: 19.75% following the promotional period
Cash advances: 21.5%
Balance transfers: 21.5%

Your interest rate will increase to 24.75% on your next statement if you:

  • make a late payment
  • go over your credit limit
  • make a payment that is returned
  • fail to meet any of the terms in the cardholder agreement.
Interest-free grace period

21 days

When you use the card to make purchases you will benefit from an interest-free grace period of at least 21 days if you pay off your balance in full by the due date.

There is no interest-free period on cash advances or balance transfers.

Determination of interest

If interest is charged, it is calculated on your daily average balance and charged monthly to your account on the last day of your billing cycle.

Minimum payment

2% or $10

Your minimum payment will be the greater of 2% of the outstanding balance owing as shown on your monthly statement, or $10.

Foreign currency conversion

2%

We will bill you in Canadian currency if you use your credit card account to make transactions in foreign currency. We will convert the amount directly to Canadian dollars at the exchange rate in effect at the time we post the transaction to your credit card account.

When the transaction is posted to your account, in addition to the exchange rate, you will be charged a foreign currency conversion rate of 2% for each foreign currency transaction.

Annual fee

$50

To be charged on your first statement and annually on the anniversary date of your first statement.

Other fees

To be charged on the day the transaction occurs:

Cash advance: $5
Over the credit limit: $20
Balance transfer: 1% of the amount transferred
Extra copy of your monthly statement: $2


Understanding your credit card payment terms

Interest-free grace period

You can benefit from an interest-free period, also known as the grace period, when you make purchases with your credit card. To do so, you must pay the balance in full by the current month’s due date. The grace period on new purchases officially starts on the last date that is included in your monthly billing period.

The grace period on new purchases must be a minimum of 21 days as long as you pay the full balance by the current month’s deadline. The 21-day grace period on new purchases applies even if an outstanding balance has been carried forward from the previous month.

The interest-free period does not apply to balance transfers or cash advances. With these transactions, interest is charged right away.

 

Example:

Rajiv made a new purchase on May 5. His statement covers transactions he made between May 1 and May 31.
 
His statement shows the due date for his payment as June 21. This means that he will have a 21-day grace period from the last date included in the statement (May 31), provided that he pays the balance in full by June 21.

 

Avoiding interest charges

You will never have to pay any interest if:

1. you always pay the full amount owing on your credit card by the payment due date;

AND

2. you don’t use your credit card to take cash advances or make cash-like transactions, such as a wire transfer or money order.

How interest charges are calculated

If you don’t pay the amount owing on your credit card in full by the due date, you will pay interest, which increases the cost of everything you have charged to your card.


Transaction type
How interest is calculated
New purchases
(purchases that appear on your monthly statement for the first time)
You are not charged interest on the first monthly statement.
Previous purchases
(purchases that were listed on a previous statement where the full amount owing was not paid by the due date)
You are charged interest back to the date you made these purchases until you make a payment that covers the full amount of these purchases.
Cash advances, balance transfers and “cash-like” transactions You are charged interest from the date you made the cash advance or balance transfer until the date you repay the total amount in full.

You don’t benefit from an interest-free period on these transactions.

Minimum monthly payments

The minimum monthly payment is the minimum amount you have to pay for a given month if you are carrying a balance on your credit card.

If you don’t pay the minimum amount by the due date, your credit score could be lowered. The lower score could reduce your chances of getting a loan in the future.

Your credit agreement will tell you how your minimum payment is calculated. A common method is either a flat dollar amount (usually $10) or a percentage of your outstanding balance, whichever is greater.

Keep in mind that paying only the minimum amount you owe is very costly because interest will continue to grow.

 

Example:

Amy has an outstanding balance of $2,000.00 on a credit card with an 18% interest rate. Her minimum payment is $10.00 or 2% of the balance, whichever is greater. Amy’s minimum payment would initially be $40.00 (2% of $2,000).

  • If Amy makes only the minimum monthly payment of $40.00 every month, it would take her 30 years and 10 months to pay off her balance in full AND she would end up paying $4,931.11 in interest.
  • If Amy were to increase her monthly payment to $100.00, she would take only two years to pay off the balance in full and she would pay $395.65 in interest.
This example illustrates how expensive it can be to pay only the monthly minimum amount. Increasing the monthly payment by even a small amount can drastically shorten the length of time it will take you to pay off a credit card balance.

 

How payments are applied to your balance

If you do not pay off your balance in full, it’s important to understand how your credit card issuer will apply your payment against your balance. Federally regulated financial institutions, such as banks, must follow certain rules when applying your payment to your account.

Keep in mind that the credit card issuer can charge different interest rates for different types of transactions. For example, for purchases, your interest rate could be 18%, but for cash advances and balance transfers, it might be 21%. Check your credit card agreement or disclosure statement, because these interest rates must be outlined in the agreement or statement. If they are not, contact FCAC to review your agreement.

Credit card issuers can apply the minimum payment any way they want. However, if you pay more than the minimum amount, your credit card issuer has to apply the amount over the minimum payment in one of two ways:

  1. to the part of your balance with the highest interest rate, and then in descending order to the rest of your balance (next highest interest rate to lowest), or
  2. proportionally to all interest rate categories of the balance.

Try FCAC’s Credit Card Payment Calculator to see how increasing your payment will help you be debt-free sooner.

 

Example:
Let’s say you are carrying a $2,000 balance that includes $1,500.00 of purchases and $500.00 of cash advances. If you make a payment of $700.00 in addition to the minimum payment, your payment could be applied as follows:
Method one: Highest interest rate to the lowest
Type of transaction
Interest rate
Portion of balance
Amount applied to each transaction type
Cash advances
21%
$500.00
$500.00
Purchases
18%
$1,500.00
$200.00
Using method one, your $700.00 payment (over the minimum payment required) would pay off all of the cash advances, which have a higher interest rate. The remaining portion of the payment ($200.00) would be applied to the portion of the balance with the lower interest rate (purchases).
Method two: Payment applied proportionally
Type of transaction
Interest rate
Portion of balance
Amount applied to each transaction type
Cash advances
21%
$500.00
(25%)
$175.00
(25% of payment)
Purchases
18%
$1,500.00
(75%)
$525.00
(75% of payment)
Using method two, 25% of your payment ($175.00) would be applied to the cash advances, because cash advances account for only 25% of the balance. The other 75% of your payment ($525.00) would go toward the purchases, because they account for 75% of the balance. This means that you will continue to pay interest on $325 of cash advances at the higher interest rate.


What happens if you make a late payment?
It’s important to pay your credit card bill on time. If you don’t pay by the due date indicated on your statement, you’ll be charged interest on the entire amount you owe until you pay it in full.

Late payments could also result in:

  • penalties, such as an increase in your interest rate
  • damage to your credit score
  • your card being cancelled by your issuer.

If you want to cancel your card

To cancel a credit card account, you must contact your credit card issuer. Simply cutting the card or not using the card will not automatically cancel the credit card account.

See the FAQ How do I cancel a credit card account? for more information.

 

 

Joint or shared cards: Understanding your liability

When are you considered joint borrowers?

If you co-signed for a credit card with another person (or a group of people), you are considered joint borrowers. The lender must give all of you copies of the credit agreement and the monthly statements, unless you consent either verbally or in writing (on paper or electronically) to waive this right.

With monthly statements, you can keep track of the status of the account—for example, whether the other borrower is making payments or if the terms and conditions have changed. Receiving regular statements also allows joint borrowers to understand what they are responsible for.

Who is liable?

Anyone who signs the application form can be liable for any outstanding balance. This applies whether or not you incurred the total debt.

For some credit cards, the terms may state that authorized users (secondary cardholders) can also be held responsible for any outstanding balances, even if they don’t sign the credit card application. Read the credit agreement carefully and make sure that you fully understand who is responsible. If you aren’t sure, ask the lender.

If the credit card issuer considers…
that means…
All card users responsible as joint borrowers (sometimes called authorized users or secondary cardholders)
  • each user can be held fully responsible for any outstanding balances
  • each user has the right to receive the credit card agreement and monthly statements.
Only the primary cardholder responsible
  • the primary cardholder is responsible for all outstanding balances
  • only the primary cardholder has to receive information about the credit card account.

 

Unauthorized transactions: What to do if you have a problem

Unauthorized transactions

If you find unauthorized transactions on your credit card account, follow these steps to find out whether you can be reimbursed:

  1. Contact your credit card issuer immediately and report the unauthorized transactions. Also inform your local police.
  2. Check your credit card agreement. By law, your agreement must explain your maximum liability in the case of lost or stolen credit cards, or the unauthorized use of your credit card account number.

Visa, MasterCard and American Express have zero-liability policies, so that if your credit card is lost or stolen, or if someone uses your credit card number to make transactions you didn’t authorize, you can usually be reimbursed. The Financial Consumer Agency of Canada (FCAC) monitors these commitments, so if you’re having difficulty, contact FCAC and we will review the complaint.

The zero-liability policy applies to transactions made on the Internet, by phone or at retailers. However, it may exclude transactions made using a PIN (personal identification number)—for example, a cash advance made with your card at an automated banking machine. It may also exclude transactions made with convenience cheques, or transactions made on corporate credit cards.

Contact your credit card issuer to find out its policy on unauthorized transactions and how you can be protected. This type of policy is not usually listed in a credit card agreement, since it is a public commitment and not a legal requirement.

If you have a complaint

Federal financial consumer protection legislation requires all federally regulated financial institutions to have a complaint-handling process in place to help resolve disputes between consumers and their financial institutions.

If you feel that your federally regulated financial institution did not provide the required information to you or charged you a fee incorrectly, then you should make use of your financial institution’s complaint-handling process and contact FCAC. FCAC can investigate your complaint to determine whether your financial institution has complied with its legal commitments.

The role of FCAC

Federally regulated financial institutions have certain legal obligations to consumers, including some related to credit cards as described in this publication. Any consumer can file a complaint with FCAC, and there’s no cost involved. Call us toll-free at 1-866-461-3222 or send us a message at info@fcac-acfc.gc.ca.

For more detailed information on FCAC’s role in handling complaints, visit the How to lodge a complaint section of our website.

Thinking of opening a Tax-Free Savings Account?

 

What is a TFSA?

A TFSA is a kind of savings account registered with the federal government.

The key benefit is that you do not have to pay taxes on earnings within the account (including interest, dividends or capital gains) or on money you withdraw from the TFSA. However, contributions to the account are not tax-deductible.

Other important features are:

  • You can carry forward the unused contribution room, increasing the allowable limit in future years.
  • The money you withdraw can be used any way you like. 

Who can open a TFSA?

Canadian residents age 18 or older who have a valid Social Insurance Number (SIN) can open a TFSA and contribute savings, up to the limit of their contribution room.

Note: In some provinces and territories, the legal age at which a person can enter into a contract, including opening a TFSA, is 19. In these cases, the annual contribution limit for the year they are 18 is carried forward and added to their contribution room when they open a TFSA.

What are the annual contribution limits?

As of 2013, the annual contribution limit for TFSAs is $5,500.

If you have not contributed the maximum amount for previous years, you can add your unused contribution room to the $5,500 to calculate the maximum amount you can contribute for this year.

Keep in mind:

  • You begin to accumulate contribution room in 2009 or the year you reached the age of 18 if that is more recent.
  • The annual contribution limit was $5,000 from 2009, when TFSAs were introduced, until 2012.
Example: Jen has made periodic contributions to her TFSA since they became available
  2009 2010 2011 2012 2013
Annual contribution limit $5,000 $5,000 $5,000 $5,000 $5,500
PLUS unused contribution room from previous year - - $2,000 $6,000 $4,000
Maximum amount that Jen can contribute $5,000 $5,000 $7,000 $11,000 $9,500
Amount that Jen contributed $5,000 $3,000 $1,000 $7,000 $6,500
Unused contribution room carried forward to next year - $2,000 $6,000 $4,000 $3,000

To check how much TFSA contribution room you have available, contact the Canada Revenue Agency at 1-800-959-8281.

Caution: Contributing after you withdraw money

If you have already contributed the maximum amount for the calendar year, and you withdraw money from your TFSA, you cannot re-contribute to your TFSA in the same calendar year without paying an over-contribution penalty. However, your annual contribution limit for the following calendar year increases by the amount you withdrew.

For example, you contributed the maximum amount to your TFSA in April this year, and then withdrew $1,000 in October of the same year. To avoid an over-contribution penalty, you must wait until at least January of next year to re-contribute the $1,000. The maximum amount that you can contribute for next year will increase from $5,500 to $6,500, taking into account the $1,000 you withdrew.

Can I have more than one TFSA?

You can have more than one TFSA open, but you cannot contribute more than $5,500 annually, plus any unused contribution room from previous years. For example, you could contribute to a TFSA with Bank A and to a TFSA with Bank B, but if your combined contributions exceed the maximum amount you can contribute for the year, you would have to pay a penalty.

What investments can I hold in a TFSA?

Your TFSA can contain the following types of investments:

  • cash
  • guaranteed investment certificates (GICs)
  • government and corporate bonds
  • mutual funds
  • publicly traded securities or stocks.

Where can I open a TFSA?

You can open a TFSA at most financial institutions, such as banks, credit unions, caisses populaires, trust and loan companies, and life insurance companies.

If you are considering opening TFSA with a federally regulated financial institution, you have the right to be informed of key details before the plan is set up. See Registered products: Your rights and responsibilities.

How can I transfer a TFSA to another financial institution?

If you want to transfer a TFSA from one financial institution to another, the transfer has to be done directly between the two financial institutions for you to avoid potential over contribution penalties.

For example, if you have made a $5,500 contribution to a TFSA with Bank A this year and want to transfer it to Bank B because they are offering a higher interest rate, Bank A would have to transfer the money directly to a TFSA with Bank B. If you were to simply withdraw your $5,500 from Bank A and use that money to open a second TFSA with Bank B, this would be considered a separate contribution from the original $5,500 contribution to Bank A. And because you had already reached your contribution limit for the year, you would be charged an over-contribution penalty.

For more information and examples, see “qualifying transfers” on the Canada Revenue Agency’s website.

If you want to transfer a TFSA between financial institutions, speak with your financial institution for more information.

Other things to keep in mind

  • Different financial institutions charge different fees so shop around before opening a TFSA. Possible fees include account opening fees, transaction fees and monthly maintenance fees. There may also be fees associated with certain types of investment products you can hold within the TFSA.
  • Make sure you read the entire contract before signing. If you don’t understand something, ask for an explanation. For more information on contracts, see FCAC’s publication Before you sign any contract: 10 things you need to know.

Questions to ask before opening a TFSA

  • What are the fees for opening and maintaining the account?
  • Are there any other fees?
  • Who do I contact if I have a problem or question?

For more information

For more information on the Tax-Free Savings Account, contact a financial institution that offers the account. You can also visit the TFSA website or call the Canada Revenue Agency (CRA) at 1-800-959-8281.

 

Debt check-up: Are you at risk if interest rates rise?

Couple discussing 

Interest rates are at all-time lows in Canada, but they are likely to rise at some point. When they do, you can expect that your debt payments will increase if:
  • you have a mortgage, a line of credit or other loans with variable interest rates
  • you are nearing the end of the term on a fixed interest-rate mortgage or loan and will need to renew it.
Have you risk-proofed your budget to ensure you can manage future increases in your debt payments? If you are already close to the maximum payments you can afford, it’s time to think about how you can prepare to manage your debt if interest rates and your payments increase

Example: Impact of interest rate increases

Sofia and Lucas bought their first home for $320,000 in 2010.1 They had a $32,000 down payment (10%), so they needed mortgage default insurance, which brought their mortgage loan to $294,912. They chose a variable interest-rate mortgage for a five-year term, with a 25-year amortization period. They also have other debts, as shown below.

They have been making all their payments, but they have trouble putting aside money for savings. They are starting to worry about what would happen if interest rates on their mortgage and some of their other debts increase. They decide to check how interest rate increases of 0.5%, 1%, 2% and 3% would affect them.

Mortgage

After two years, the outstanding balance on Sofia and Lucas’ mortgage is now $278,748, with 23 years remaining on the amortization period. The variable interest rate is currently set at 3.1%.2 Their current monthly mortgage payment is $1,411.

Car loan

The current balance is $10,000, with three years remaining on the term. The interest rate is fixed at 5.5%,2 and monthly payments are $302.

Personal loan

Lucas has a personal loan of $6,000 to be paid off in two years, with a variable interest rate currently set at 4.75%2 and a monthly payment of $262.

Credit card debt

The couple is carrying $6,500 in credit card debt, with an interest rate of 19.9%.2 They aim to pay it off within two years by making monthly payments of $328. (This assumes that they do not add any new charges to the credit card during that time, and that the interest rate stays the same.)

 

 

 

Description​

 

 

Balance​

 

Current interest
rate​

 

Amortization
or repayment period​

 

Current monthly payment​

Monthly payment
if interest rate
increases:
+ 0.5%    + 1%   + 2%   + 3% 
Mortgage costs​ ​ ​ ​ ​ ​
Mortgage​ $278,748​ 3.1%​ 23 years​ $1,411​
$1,483​ $1,556​ $1,709​ $1,868​
Debts with variable interest rates
Personal
loan,
variable
rate​
$6,000​ 4.75%​ 2 years​ $262​
$264​ $265​ $268​ $270​
 ​
Other debt payments:
fixed interest rate or unlikely to be affected by 0.5%–3% increase​
Car loan​ $10,000​ 5.5%​ 3 years​ $302​
$302 $302​ $302​ $302​
 ​
Credit
card​
$6,500​ 19.9%​
Target
repayment
in 2 years​
$328
$328​ $328​ $328​ $328​
 ​
Total
monthly
debt
payments​
$2,303​
$2,377​
$2,451​
$2,607 $2,768​
 ​
Increase
in monthly
costs​
---- 
$74 $148 $304 $465
 ​
 

Sofia and Lucas were surprised to see that if interest rates increase by 1%, they will have to find almost $150 in their monthly budget to cover the higher costs. If rates rise by 3%, their monthly payments will be over $450 higher.

Sofia and Lucas decide that they are outside their financial comfort zone. They consider options to have more money available to repay debts and save for their goals.

Tips

  • If you have debts with high interest rates, such as credit cards, consider consolidating your debts in a loan with a lower rate, BUT
    • keep your payments the same, and
    • avoid taking on any more debt.
  • This will help you reduce your debt levels faster, since more of your payment will go toward the principal.
  • Paying off your debt with the highest interest rate first will reduce the amount you are paying in interest and help you reduce your debts more quickly.
  • If you are considering borrowing more, take a close look at how it would impact your payments, your budget and your ability to save for other goals. Stay within your comfort zone.  
  • You are in the danger zone if:
    • you are already having trouble making your debt payments, or
    • you are close to your limit and would have trouble making higher payments if interest rates increase.
  • To reduce your risk, review your budget with a goal of reducing your spending, so that you have more money available to repay debts.
  • Remember that getting the biggest mortgage or line of credit that you are offered may push your financial limits. Leaving some room to deal with the unexpected will reduce the stress on your finances—and your nerves.
  • To increase your debt repayments, consider ways you could increase your household income.
  • It’s also a good idea to ensure you have an emergency fund of at least three months’ living expenses to deal with unexpected situations.

Worksheet

  • Use the table below to calculate your current monthly mortgage costs and debt payments.
  • Talk to your lenders to find out how much your payments would increase if interest rates rise by 0.5%, 1%, 2% and 3%.
  • Look at how the higher payments would impact your monthly budget and your ability to save for your goals.
  • If you are outside your comfort zone, look at how you can reduce expenses or earn more money to pay off your debt faster.

 

PDF version (106 KB, 1 page)

Description​ Balance​ Current
interest rate​
Amortization
or repayment
period​
Current monthly payment​
Mortgage and housing costs​
Mortgage
Condo fees
(include 50% of total cost)​
N/A
Debts with variable interest rates​
Home equity
line of credit
Personal loan, variable interest rate​
Other debt payments:
fixed interest rate or unlikely to be affected by 1%–3% increase​​
Personal loan, fixed interest rate​
Credit card​
Car loan​
Total monthly debt payments
Monthly household income​

 

Keep your debts in check—your financial health depends on it!


How Can You Help
1. Share this website on your facebook and all social media make collection agency's stop calling: http://www.myskipassist.com/makecollectionagencysstopcalling.php
2. Share this website with your emails simply copy and pase the following link:
http://www.myskipassist.com/makecollectionagencysstopcalling.php
3. If you think someone you know is being harrased, intimidated or bullyed in any other way. Help them send
do not call letter.
4. Help them file a ministry complaint by clicking the province they live in and sending in the complaint form.
5. If you are financialy able to make a donation to our cause you can feel good knowing the donation money is going to good use helping us end
collection agency bullying and harrasment for good. To make a donation please click the button below.

 You can also support us by purchasing one of the offers listed below, this way you can get something for youself and at the same time make a donation. We appriciate any help no matter how small. We can also mention your name or buisness name on our donation page, we would really like to have some reputible credit counsellor's and trustee's listed as well as any other person or buisness that would like to donate. If you don't want to be listed that is fine too.

Debt collectors Information, debt collector is a term for a licensed bill collector and debtor is term for person in debt which is secured or unsecured debt

get out of debt, how can you be debt free

credit card debt and all other unsecured debt

 

 

 

 


Powered by 4GoodHosting

Find People, Find Phone Numbers, Find Addresses, Find Buisnesses, Your #1 Trace tool & collection agency guide My skip assistPeople Finding websitesFinding people using google, google tricks, Consumer protection websites canadaMake Collection Agency's Stop Calling YouCollection agency rules AlbertaCollection Agency Rules British ColumbiaCollection Agency Rules SaskatchewanCollection agency rules ManitobaCollection Agency Rules OntarioCollection Agency Rules QuebecQUEBEC CONSUMER PROTECTION ACT PAGE 2Collection Agency Rules PEICollection Agency Rules Newfoundland & LabradorCollection agency rules NunavutCollection Agency Rules Northwest territoriesCollection agency rules in Yukon TerritoriesGovernment Of Canada Everything You need to know about credit Page 1Government Of Canada Everything you need to know about credit Page 2Goverment of canada everything you need to know about credit page 3United States Collection Agency RulesCollection agency rules state of AlabamaCollection Agency Rules AlaskaVIDEO PAGE - VIDEO GUIDE TO STOPPING COLLECTOR CALLS YOUR CREDIT AND MOREHow to file a collection agency complaint and all the collection agency rules. All your options from bankrupcy to credit counsellors and everything inbetweenList of all trustees in CanadaCanadian Consumer Handbook Collection AgenciesCanadian Consumer Handbook ContractsCanadian Consumer Handbook Credit ReportingCanadian Consumer Handbook Debit Card FraudCanadian Consumer Handbook DebtCanadian Consumer Handbook Financial ServicesCanadian Consumer Handbook MortgagesCanadian Consumer Handbook Payday LendingBuild Your Buying Skills From OCASpending Smarter Tools from OCATake Charge of Your Debt from OCACellphones from OCALearn About the Retail Market from OCAProtect Your Privacy from OCAGet a Mortgage, Mortgage Refinanace, Second Mortgage, Equity LoanMortgage Basics- What you need to knowHow credit effects your mortgageGuestbookALL Collection Agency's in Canada page 1ALL Collection Agency's in Canada Page 2ALL Collection Agencys in Canada page 3ALL Collection Agency's in Canada Page 4ALL Collection Agency's in Canada Page 5