• checkbox logo Reduce debt by up to 80%

Debt Glossary of Terms

Get a Free Debt Repayment Plan

Safe, secure & confidential

google logo



In financial terms, an asset is a resource owned by an individual or a business that has value. The expectation is that it will provide a future benefit of some sort. It can be something physical, such as cash, machinery, property, or inventory, or it can be an enforceable claim against others, such as accounts receivable.

Consumer Proposal

A consumer proposal is a legally binding promise to pay your creditors a percentage of your debt over a period of time. Unsecured debts between $10,000 and $250,000 qualify for this option as long as you have a sufficient income to make monthly payments. It is a good alternative solution to bankruptcy and can relieve a lot of stress.

Credit Report

A credit report is a report on your credit history. Credit bureaus will collect information from various sources and create the report based on that information. This information can then be used to determine whether or not you should be approved for a loan.


A creditor is an individual or company who is owed money, usually at a predetermined interest rate. A creditor does not have to accept less than the agreed amount. Even if there was no actual agreement, the debtor must pay the creditor if the creditor loaned money, performed services or sold a product to the debtor.


Debt and liability often refer to the same thing. Debt is any amount of money or other assets that are borrowed (e.g., a loan). Debt makes large purchases possible that would otherwise not be affordable. In nearly all circumstances, debt costs the debtor interest in addition to principal repayment.


A debtor is one who owes money. A debtor can be an individual consumer who incurs debt for personal, family or household purposes or a business. When debt is in the form of a loan from a financial institution, then the debtor is called a borrower.

Interest Rate

An interest rate is calculated as a percentage of the principal that is charged on a daily, monthly or annual basis. Higher rates will apply to a borrower that is considered a higher risk of defaulting on a loan, while lower rates are charged for lower risk clients.

Two calculations for interest rates are most common. A simple interest rate is the principal amount borrowed multiplied by the annual interest rate multiplied by the number of years the loan is outstanding. A compound interest rate additionally takes into account accrued interest from the previous months. There is not much difference between the two calculations for short periods, but the disparity between them increases over time.

A fixed or variable interest rate can apply to debt. A fixed interest rate (such as applicable to credit card debt) remains fixed for the entire term. A variable rate fluctuates according to changes in a benchmark interest or index, such as the Bank of Canada interest rate.


A mortgage is a loan used to raise funds for purchasing real estate or by existing property owners to raise funds for any other purpose. It involves putting a lien on property being mortgaged. The mortgage is secured using the borrower’s property as collateral, and the lender can take possession of the property if the borrower is not able to meet their payment obligations.

Personal Bankruptcy

Personal bankruptcy is the act of declaring that you have no money, eliminating all your debts. It is filed by a Trustee under the Bankruptcy and Insolvency Act, allowing you to gain a fresh financial start. However, it will leave a mark on your credit report for many years, which may affect other things down the road.


Refinancing is what occurs when a person or business revises their debt repayment schedule. The old debt is ostensibly paid off and is replaced with a new loan offering different terms. It typically extends the maturity date of the loan. Refinancing may involve a penalty or fee.

Revolving Credit

Revolving credit is a line of credit that automatically renews as debts are paid off. The customer pays a commitment fee, allowing them to use funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the cash flow needs. Corporations and individuals can apply for this type of credit.

Secured Debt

Secured debt is debt backed or secured by collateral (e.g., a mortgage is secured by a house, a car loan is secured by the car). If you default on repayment, the lender can seize the asset, sell it and use the proceeds to pay back the debt. Because securing debt reduces risks for the lender, the loan terms (e.g., the interest rate, loan time period) are more attractive for the consumer than with unsecured debt.


Seizure is when you are unable to pay your loan or debt, and the creditor is allowed to take possession of some of your assets to pay the loan instead. An example would be a client who has a car that they finance and cannot pay for. The dealership would be able to seize the car and sell it to pay off the rest of what you owe.

Unsecure Debt

Unsecured debt is a loan advanced without any security provided (e.g., credit card balance, utility bills and other types of loans or credit). Unsecured debt is a higher risk to the lender and so the lender will require a higher interest rate in return.

Our Debt Management Solutions

woman whispering to a child
Support across Canada

Why Harris & Partners

chart icon
Remove up to 80% of your debt

Our Licensed Insolvency Trustees provide a customized service that could remove up to 80% of your debt and stress, so you can breathe easier.

people circle outline
We speak your language

Our multilingual team provides support in many languages, from Farsi and Portuguese to Italian and Tamil, leaving out complicated jargon, so you understand everything, every step of the way.

location logo
Debt support across nine provinces

Want to speak to someone in person? Our team is on hand to help at a Harris & Partners office near you.

Get in touch with Harris & Partners

If you need help from those who specialize in solving debt problems, contact us at Harris & Partners Inc. Licensed Insolvency Trustee. In Toronto, NorthYork, Brampton, St.Catharines, Ottawa, Pickering, Oshawa, Hamilton, Kitchener, Brantford, Barrie and Markham, our federally Licensed Insolvency Trustees can help you achieve long lasting financial solutions.

Contact information

It's never too late to obtain debt help. Book your free consultation today

Phone number
Send us a message

Contact form

✓ Valid number ✕ Invalid number
This field is for validation purposes and should be left unchanged.
Shahrad Nakhaie
Shahrad Nakhaie
They are so great, every thing was so easy for me. Unbelievable, All my debt are gone now and I feel like I'm free, thanks Osman Ali for all you did for me, at the first time it's even hard to believe that was real, but it's real and easy. Thank you bro for your help.
Osman is a professional and you cant find anybody better. He really cared about my situation and paid attention to every little detail so he can help me best. Thank you osman and the rest of the team for helping me through my struggles.
Banda Gueye
Banda Gueye
Osman is a vert nice gentlemen, he was polite sweet and gentle. He really cared about my situation and paid attention to every little detail so he can help me best. Thank you Osman and the rest of the team for helping me through my struggles.
Kim Brown
Kim Brown
So far this has been a great company, I have been with them over a year. Every time I have an issue Josh jumps right on it and helps me out. He never makes me feel like I'm being a pain in the butt 🙂 I definitely recommend them, I have referred two of my family members to get help and now Josh is helping them as well. I thank you Josh for all the hard work and responding so quickly to all my messages.⭐️⭐️⭐️⭐️⭐️
Ajanthan Murugananthan
Ajanthan Murugananthan
Staff members Samuel and Josh were both amazing. Both very friendly, professional, and efficient. They took care of my credit card issues and line of credit and made it manageable. I would highly recommend Harris & Partners Inc. They have given me a new life in my financial life to success.
Paul Woo
Paul Woo
Staff members Yasan and Josh were both amazing. Both very friendly, professional, and efficient. They took care of my credit card issues and made it manageable. I would highly recommend Harris & Partners Inc.