Consumer Proposal vs Other Debt Reduction Options in Chilliwack BC
When you compare all the possible debt reduction options in Chilliwack BC, you will discover 4 distinct solutions being marketed to consumers. Each of these solutions will eventually eliminate your debt, and each of these solutions will come with a different cost.
As you can see in the above chart, the overall costs and the monthly payment related to a consumer proposal is significantly more affordable and viable in reducing debt.
It is important to remember that there are other factors that will impact your decision, distinct advantages and disadvantages apply to each of the 4 debt reduction options.
Will a consumer proposal remove all my debt?
A consumer proposal applies to debt related to unsecured creditors and can eliminate almost all unsecured debts including:
- CRA debt
- credit card debts
- bank loans
- payday loans
- GST debt
- qualifying student loan debt
A consumer proposal will NOT apply to or affect the mortgage on your principal residence or a secured car loan
Will you qualify for a consumer proposal in Chilliwack & Abbotsford BC
Consumer proposals must be administered through a LIT and as a federally regulated debt reduction program, proposals have specific requirements you must meet to be able to qualify;
- You must have a regular source of income and be able to make the required payments
- You must be insolvent, meaning your debts must be greater than the value of any assets you own, or you can no longer keep up with debt payments required
- Your unsecured debt must not exceed $250,000 (not including your mortgage); (if your debts exceed this value we can file a Division 1 Proposal instead)
- You must be a resident of Canada or have property in Canada but you do not have to be a citizen of Canada.
Advantages of a Consumer Proposal
60% of insolvent citizens of Abbotsford and Chilliwack BC have chosen Consumer Proposals as their #1 alternative to filing bankruptcy. The consumer proposal provides people significant benefits over the other debt relief options:
- Reduce your total unsecured debt by up to 70%
- Keep all your assets including any equity in your home and RRSP
- Reduce and consolidate debts into one, affordable, monthly payment;
Freeze interest on your debts to 0%
- All creditors will be legally bound to the proposal, no further recovery actions or legal action can be pursued by any creditors
- Avoid bankruptcy
- Pay off your proposal at anytime during the term agreed
- Stop calls from collection agencies and wage garnishments
A consumer proposal is a legal process under the Bankruptcy & Insolvency Act. As with any of the options above, a consumer proposal will potentially negatively impact your credit score. However most of our clients see an improvement in their credit score as soon as they have made all the payments required by the proposal.
Contact Us to review your situation and determine if a consumer proposal is the best solution for you and your family.