The many benefits of consumer proposals
Filing for a consumer proposal can provide these benefits and help individuals facing financial challenges regain control of their finances:
- Consolidation of debts into a single manageable monthly payment.
- Protection against creditor actions such as wage garnishments, collection calls, and legal proceedings.
- Opportunity to make affordable payments based on income and expenses, easing the burden of multiple creditors.
- Potential for credit score improvement over time as responsible debt repayment is demonstrated.
Filing for a consumer proposal offers these additional benefits, providing individuals with a pathway towards financial stability and debt relief:
- Relief from the stress and harassment associated with overwhelming debt, as all collection efforts must cease once the proposal is accepted.
- Structured repayment plan that provides a clear roadmap for debt repayment, allowing individuals to better manage their finances.
- Opportunity to negotiate with creditors and potentially reduce the total amount of debt owed.
- Guidance and support from professionals experienced in consumer proposals, who can help navigate the process and make informed decisions about financial future.
FAQ – Consumer Proposal
Are consumer proposals usually accepted?
Yes! Consumer Proposals vary for every person, but most are accepted. Most consumer proposals offer a good deal to creditors and lenders, so they are usually accepted. Some proposals don’t even need a meeting with creditors.
How much will I pay back in a consumer proposal?
In a best-case scenario, a consumer proposal can reduce your principal to 20 or 25% of what you originally owed.
How will a consumer proposal help me?
- It can help you avoid bankruptcy.
- The formal document sets clear rules and expectations.
- A stay of proceedings will be issued for non-secured creditors.
- Your loans will stop accruing interest.
How will a consumer proposal hurt me?
- You will be required to fully disclose your financial situation.
- There are strict rules and regulations that cannot be changed.
- Stay of proceedings does not apply to secured creditors.
- Interest continues to accrue on secured debts.
- You cannot pick and choose which creditors are included or not included in your proposal.
What can be included in my consumer proposal?
Most unsecured debts will be included in your consumer proposal, including:
- Credit card debt
- Lines of credit
- Personal loans
- Payday loans
- Student loans older than 7 years
- Income tax debts
Will I lose my car or my house in a consumer proposal?
No, you will not lose your car or house in a consumer proposal. Your assets will be protected from unsecured creditors, but secured creditors are not included in your proposal. This means that as long as you continue to make payments on your car loan or mortgage, your secured assets will not be repossessed.
Can I keep my credit cards during a consumer proposal?
A consumer proposal will negatively impact your credit since a note will show up on your credit report for three to six years. This will let lenders know that you have filed a proposal which can make it hard to obtain future lending but it is possible to rebuild your credit after a consumer proposal.