How (Not) to Consolidate Debt

Diane Buchanan • March 2, 2017

By Sandi Martin of Spring Personal Finance.

The point: it doesn’t matter what method you use to pay off debt, or if you use any method at all. What matters is that you stop creating new debt.

It’s out there: the mathematically precise, strictly rational formula for paying off your three credit cards, small car loan, and fluid line of credit balance. It’s not too hard to calculate the most efficient way to allocate every dollar and wring the most interest-busting bang out of each buck.

If that doesn’t work for you – and let’s be honest, it often doesn’t  – there’s a psychologically motivating method that throws math out the window and concentrates on tickling your brainpan with the momentum of every dollar that’s paid off – like the eponymous snowball rolling down a hill.

Proponents of these two camps are territorial and permanently at odds. (I’m just spitballing here, but I imagine it has to do with not being able to live inside somebody else’s brain and see how it works, like so many other disputes.)

Frankly, I don’t care how you pay off debt, so long as you simultaneously stop creating more.

Enter debt consolidation. Often a polarizing bone of contention between the two camps, debt consolidation – for those three of you in the back of the room unfamiliar with the concept – is when a lender gives you the money to pay back all of your other debt that’s scattered across the country and pay them back instead. They win by getting a new loan on the books, and stealing market share from the competition. You win by bringing down your overall interest rate.

What’s to argue with, right?

This is what to argue with: there’s a teeny-tiny window of opportunity in which debt consolidation is a powerful tool to bring your debt-free date closer and eat vast chunks out of the total amount of interest you’ll pay. That window of opportunity is open for about half an hour, and when it closes, it’s so hard to reopen that it might as well be painted shut.

If from the outset you don’t commit to a payment that is equal to or more than the amount you were paying on your unconsolidated debt, and that will get your three credit cards, small car loan, and fluid line of credit paid off in less time than they were originally amortized for, then you’re not paying down your debt, you’re just moving it around.

If you don’t take a long, hard look at how you got into debt in the first place, and – from minute one of your newly consolidated life – take measured, calculated steps to not do it again, those credit card balances are going to creep back up again. You’ll find yourself in the same office, maybe even in front of the same banker, signing a new set of loan papers for a new consolidation loan three years down the road.

I began my career in banking in the heyday of debt consolidation lending. The amount of new unsecured dollars added to our lending portfolio was a huge component of our sales scorecard, and while the focus shifted to include a wider spectrum of  product sales after 2008, banks are still hungry for your debt consolidation dollars. *

Folks, I’ve seen a lot of debt consolidation train wrecks, and about five of them where due to circumstances beyond the borrower’s control. The other 7,256,219 were due to the window slamming shut, either because the borrower didn’t know or didn’t care about it.

I’d love to blame the bank for it (you know I would), but I can’t. Yes, the banker you sit across from has incentive to talk you into stupid stuff that’ll not only shut the window of opportunity, but nail it closed and board it up too. (“Increasing your cash flow” is a phrase that comes to mind.)

But down in the land of brass tacks, you just signed a loan to pay off other loans. If you weren’t thinking about how you got to this point at this point, when else are you going to think about it?

If it was important enough to you to take action, why isn’t it important enough to change your behaviour?

* They’d like those dollars to be in the form of a secured line of credit, though, and will sell you on the fact that you can consolidate again and again and again, without ever having to go back into the bank to do it.

This article was written by Sandi Martin of Spring Personal Finance and originally appeared on Spring the Blog here. 

DIANE BUCHANAN
 Mortgage Broker

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How to Finance a Spousal Buyout After Separation or Divorce

By Diane Buchanan • October 21, 2026
Mortgage Options During Divorce or Separation: What You Should Know If you’re going through—or considering—a divorce or separation, you may not realize that there are mortgage solutions specifically designed to help one party keep the home . For many people, the family home is their largest asset and where most of their equity is tied up. In situations like this, a spousal buyout program can allow one person to refinance the property and buy out the other party’s share—often up to 95% of the home’s value . This option can work whether you want to keep the home or your former partner does. What Is the Spousal Buyout Program? The spousal buyout program is a refinancing option that allows one owner to purchase the other owner’s share of the property as part of a separation or divorce settlement. In some cases, it can also be used to pay off jointly held debts, as outlined in a legal agreement. Below are some of the most common questions about how the program works. Is a finalized separation agreement required? Yes. Lenders require a signed and finalized separation agreement that clearly outlines how assets and debts are to be divided. This document is essential for approval. Can the funds be used for renovations or personal debts? No. Funds from a spousal buyout can only be used to: Buy out the other owner’s share of equity Pay off joint debts specifically listed in the separation agreement They cannot be used for renovations, personal loans, or unrelated expenses. How much equity can be accessed? The maximum amount available is the amount required to: Buy out the other party’s agreed-upon share of equity Pay off any joint debts listed in the agreement This amount cannot exceed 95% loan-to-value . What is the maximum loan-to-value allowed? The maximum loan-to-value is the lesser of : 95%, or The remaining mortgage balance plus the required buyout and joint debt payout The property must be the primary owner-occupied residence . Do all parties need to be on title? Yes. All individuals involved in the buyout must currently be registered on title. Your solicitor will confirm this through a title search. Does this only apply to married or common-law couples? No. While commonly used for married or common-law couples, the program may also apply to siblings or friends who jointly own a property and need one party to exit the mortgage. These cases are typically reviewed on an exception basis and require insurer approval. If no separation agreement exists, the purchase contract must clearly outline the buyout terms. Is a full appraisal required? Yes. A physical, on-site appraisal is required to confirm the property’s value before the mortgage can be finalized. Final Thoughts This overview covers some of the most common questions about mortgage options during separation or divorce, but every situation is different. Working with an independent mortgage professional gives you access to multiple lenders, specialized programs, and unbiased advice—so you can clearly understand your options and choose what’s best for your future. If you’re navigating a separation and need guidance around keeping or selling the home, feel free to connect anytime. All conversations are handled with discretion and confidentiality, and I’d be happy to walk you through your options.

How to Legally Assign a Construction Mortgage

By Diane Buchanan • October 14, 2026
Why More Mortgage Options Matter—Especially for Assignment Purchases One of the biggest advantages of working with an independent mortgage professional is access to choice. Instead of being limited to one lender and one set of products, mortgage brokers work with multiple lenders—each with different guidelines, risk tolerances, and mortgage solutions. That flexibility becomes especially valuable when your situation doesn’t fit neatly into a “standard” box. A great example of this is purchasing new construction through an assignment contract . Why Assignment Purchases Can Be Challenging Assignment purchases are often viewed as higher risk by traditional lenders. Rather than declining these deals outright, many lenders quietly make them difficult by adding layers of conditions, restrictions, or uncertainty. This can lead to delays, frustration, or financing falling apart late in the process. The Good News There are lenders—available exclusively through the broker channel —that have clear, favourable policies for assignment purchases. With the right lender and proper planning, these transactions are absolutely doable. Typical Financing Requirements for Assignment Purchases While every situation is unique, many lenders that allow assignment financing look for the following: Standard purchase qualification, including income verification, credit, and down payment Assignments accepted at either the original purchase price or current market value Minimum 620 credit score , with no prior bankruptcies or consumer proposals The full down payment must come from the purchaser —seller incentives cannot be used Required Documentation To secure financing, lenders typically require: The original purchase agreement signed by all parties The MLS listing (if applicable) The assignment agreement signed by the builder, original purchaser, and new buyer Any side agreements outlining changes to the purchase price A full appraisal to confirm value This list isn’t exhaustive, but it highlights that while assignment purchases require more coordination, they are very achievable with the right lender and guidance. Final Thoughts Assignment contracts can open doors to great opportunities—but only if your financing supports the transaction. This is where access to multiple lenders and specialized policies makes a real difference. If you’re considering purchasing new construction through an assignment, or if you’d like to explore more traditional purchase options, feel free to connect anytime. I’d be happy to walk you through the mortgage products available and help you choose an option that doesn’t limit your financing possibilities.