Consumer Proposal will Avoid Bankruptcy
A legal binding agreement between you and your creditors, to reduce your debt amounts, end interest charges and protect your assets. Created by the Federal Government of Canada, to provide Canadians an alternative debt reduction solution that will avoid Bankruptcy.
Benefits of a Consumer Proposal
- You will repay a portion of your debt, Up to 85% maybe eliminated through a legal consumer proposal
- You keep your assets such as your home, cars, tax refunds, RRSP’s are protected from creditors.
- No Interest, all interest charges are stopped upon filing a proposal.
- Stops collection agencies & creditors from harassing you. Upon filing a proposal, no creditors or their agents are legally allowed to call you.
- One single, affordable monthly payment, based on your ability to pay.
How to Qualify for a Consumer Proposal
As a federally regulated program, Consumer Proposals have specific requirements you must meet:
- You must be able to pay a portion of your debts
- Your assets must be less than what you owe.
- Your unsecured debt must not exceed $250,000 but be more than $1000.00 (not including your mortgage)
- You must have the ability to make monthly payments, have a stable income source.
Process of a Consumer Proposal
- A consumer proposal is an offer to all of your creditors as a group, including Canada Revenue Agency, to pay only a portion of the total debt and to avoid bankruptcy.
- A consumer proposal can only be made through a bankruptcy trustee, so the first step is to sit down with a trustee and discuss your situation. She will ask you about your assets (what you own), your liabilities (what you owe), and your income (your ability to make a payment). She will help you to develop a proposal for a payment plan that works with your ability to pay and gets you out from under that crushing debt load.
- Once the proposal is ready the trustee will send it to your creditors who have 45 days to accept or reject it. Your trustee will monitor your proposal until you’ve finished your payment plan and will also provide financial counselling to help you better manage your finances in the future.