Consumer Proposals – What They Are and How Do They Work
Are you in a situation where paying off your debt seems like a distant dream? Are you fed up of the piling debt that seems to linger on for an indefinite period of time?
There is always a way out and certainly financial matters need considerable attention. If you dread filing for bankruptcy, the next most lucrative option is to file for a consumer proposal in Toronto, under the Bankruptcy and Insolvency Act.
In lieu of it, your creditors will be asked to vote on how to go about handling your debts.
The Basics of a Consumer Proposal
An alternative to bankruptcy, a consume proposal is a comprehensive process that is overseen by a bankruptcy trustee for debtors owing an amount within the bracket of $5,000 to $25,000.
Filing a Consumer Proposal for your creditors kind perusal gives you an opportunity to alleviate your debts, while retaining your assets by paying off debts within your financial limits. There’s a possibility of lowering your debt percentage to 50% or even 30%.
The Immediate Effects of Filing A Consume Proposal
- Automatically, in effect, you are legally secured from creditor calls which are inclusive of any credit card company and the Canada Revenue Agency(CRA).
- Wage garnishments cease to exist.
- You do not have to worry about losing possession of your house, like in bankruptcy.
- From the date you file your consumer proposal, interest stops accumulating.
- Your maximum repayment period stretches to as far as 5 years with your loan cut down for your convenience.
Step-Wise Process of A Consumer Proposal
A financial process obviously needs to be organized and in synchrony with certain rules and regulations. Besides that, filing a consumer proposal is quite hassle-free.
- Contact a local trustee in your area, who is approved with authority to handle Consumer Proposals.
- Choose the payment plan you think will work best for you.
- Your trustee will process to file the proposal with your creditors.
- A meeting is arranged of the various creditors involved in the case. They either choose to amend, accept or reject the proposal.
- After a certain percentage is unanimously decided upon by the creditors, a payment is made.
- Credit counselling sessions are conducted
- After you receive your official certificate of Full Performance, you can start the process of rebuilding your credit.
Do you feel that a Consumer Proposal is the right debt solution for your financial problems? At EmpireOne, our credit counsellors in Toronto provide clients with debt solutions. Call (416)900-2324 for instant credit debt help.