An honest consolidation is presented line by line: what each debt costs today, what the new structure costs tomorrow, and what the stretching costs over time. No surprises, no pressure.
Why the payment drops: the two levers
The first lever is the credit category. Credit cards, store cards, and unsecured consumer loans are priced on unsecured risk; a mortgage is priced on a property held as security. The gap between those categories is structural, not promotional. The second lever is amortization: a balance repaid over a long amortized period requires less per month than card minimum payments. That second lever is not free: stretching a debt means paying interest for longer. That cost is precisely calculable, and it belongs on the table before signing, not discovered after.
The math we present, line by line
A complete presentation lines up two columns. On the left, the current situation: every balance, its rate, its minimum payment, and the real monthly total. On the right, the proposed structure: which balances are absorbed, which stay separate (a car loan sometimes stays as is), the new payment, and the transaction costs (appraisal, notary, any penalty on the current mortgage). Then the line too many presentations omit: the total interest cost of each scenario over a realistic horizon, with an accelerated repayment plan once the budget can breathe. The monthly difference transforms a family's daily life; the cost over time decides whether the structure is sound. Both numbers matter.
When we say no to a consolidation
- When the habits have not changed. If the spending that filled the cards continues, the consolidation finances the past and sets up the next problem. The spending plan comes before the structure.
- When equity is thin. Fixed costs, penalty, and appraisal can consume the saving. If the net math does not hold up, it does not get signed.
- When the budget cannot sustain any structure. The honest conversation is then about a consumer proposal with a licensed insolvency trustee, or an orderly sale while the equity still exists. Referring a client to a trustee is part of the job, and a serious file says so plainly.
If the bank declined the consolidation
The classic paradox: the bank calculates the debt ratio before the consolidation, exactly the problem the transaction would fix. A grid decline does not end the file. Regulated B-lenders and some private lenders read the file after consolidation: real equity, demonstrated capacity to pay, explained history. In this practice those structures are one-to-three-year bridges, with a written exit plan back to standard pricing and terms that fit the file. Guide: declined by the bank.
Send David the Numbers
Send the scenario, not sensitive documents: the balances, the payments, the approximate property value. A straight answer, including an honest do not consolidate when that is the truth.
Send David the ScenarioThree cases come up constantly: when the spending habits have not changed (the consolidation then finances the past and sets up the next problem), when equity is too thin for the net math to hold up, and when the real budget cannot sustain any structure, in which case the honest conversation is about a consumer proposal with a licensed insolvency trustee or an orderly sale.
No. The decline often comes from the debt ratio calculated before the consolidation, precisely what the transaction would fix. Regulated B-lenders and some private lenders assess the file after consolidation, as a one-to-three-year bridge with a written exit plan. No approval is guaranteed.
Related: The Solution: the method · Second mortgages and private lending · Case files