Gehlen Dabbs Lawyers
Call Us
T: 604 757 9380
Call Us : 604 757 9380
Main navigation

Canadian debt at pre-recession levels

By some measures, Canadian households show higher debt levels than the US peak which preceded the Great Recession.

Debt to income ratio, or the ratio of household debt to household disposable income (income after paying taxes and other necessaries), is one indicator of consumer vulnerability to credit crises. The higher the ratio, the more easily consumers will fall into default and insolvency.

According to Statistics Canada, Canada had a household debt to income ratio of 166.8% in the third quarter of 2018, up from the previous quarter and also up from the same quarter last year. It looks like Canadian's debt is continuing to grow faster than our income.

This has implications not just for consumers but for others, such as small businesses and secondary lenders, who deal with individuals and their assets on a regular basis. Secondary mortgage lending in particular may be becoming increasingly risky as debt rises and real estate values stagnate or even drop in several locations in Canada.

Businesses exposed to consumer borrower and customers need to consider these factors when making their risk assessments.

No Comments

Leave a comment
Comment Information

contact us today

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish a lawyer-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy