Advice is a cheap commodity. You can easily get advice from anybody you know like: your friends, relatives, co-workers and neighbors for free even if they are not expert on the subject you seek for an advice. Even if they are not doctors, they can give you medical advice. Even if they are not lawyers, they can give you legal advice and even if they are not financial counselors, they can give you advice on financial matters that could include debt management, mortgage financing, credit counseling, consumer proposal and bankruptcy.
If you follow an advice from a person who is not an expert, more often than not, you would be in trouble. In fact, not all advice from experts is always appropriate for your situation.
A good example was a retired couple. Their combined net monthly income from pensions was $2,600.00. They owned a house with practically zero equity. They overused their credit cards for the renovation of their house. Their total credit card debt was about $25,000.00. Combining the mortgage payment and payments for their credit cards, their pensions were not enough to pay their monthly obligations.
Then, they went to their bank to apply for consolidation loan, but they were turned down as they were loaded with debts, no equity on their house and low income.
Next, they went to a financial counselor for an advice. They were advised to file a consumer proposal. They followed the advice and filed a consumer proposal. Two years later they default their payments on their proposal as their pensions barely enough to met their basic expenses. The proposal did not really solve their financial problem.
As a result, their proposal was cancelled and their creditors were running after them on the original amount owing of $25,000.00 plus interest in arrears for two years.
Without any other alternative, they decided to file for bankruptcy. Unfortunately, they lost the house as they did not have money or capacity to pay the equity built up over the years since they filed consumer proposal.
Had they got proper advice, they could have filed bankruptcy at the outset, and keep the house instead of a consumer proposal. Bankruptcy was the ideal solution of their financial situation, because they do not have much income and the house had no equity at the time of the proposal.
To avoid the above case scenario, it would be prudent to seek a second opinion even if an advice comes from an expert.