Consumer Proposals - What is a Consumer Proposal?

 

A consumer proposal is an alternative to bankruptcy. Its positive benefits outweigh its negatives. Consumer proposals are considered a legitimate solution to debt problems, and they can reduce the amount of total debt by 75%. However, the effect on credit can last for up to seven years, depending on the providence in which the consumer lives. The Office of the Superintendent of Bankruptcy (OSB) tracks consumer insolvencies across Canada. As of December 2016, there were over 125,000 consumer proposals and bankruptcies. This rate is up by 3.5% since the previous year, and nearly half of the proposals were bankruptcies. Find linked here more info about consumer proposals.

 

While a consumer proposal can negatively impact your credit score, it is better for your credit rating than the alternative. For one thing, a consumer proposal looks better on a credit report than a charge-off or unpaid debt. In addition, it will fall off your credit report faster than private debt settlement. Listed below are some common questions consumers ask about consumer proposals. Once you have answered these questions, you can begin exploring the process. Weigh your options carefully and get the best consumer proposal.

 

One of the first steps in obtaining a consumer proposal is to contact a Licensed Insolvency Trustee. This professional can assist you in determining whether you are a good candidate for the program. The process of making a consumer proposal can take as little as a week, and it can dramatically reduce the total amount of debt that you owe. With these benefits, a consumer proposal may be the perfect solution to your financial woes.

 

Once you have chosen your consumer proposal, the creditors must respond within 45 days. If your creditors do not respond within 45 days, your proposal will be accepted. If the creditors do not accept your proposal, you can request a meeting with them to discuss the consumer proposal. The creditors will vote on the proposal, and you can begin making payments again. The consumer will receive a Certificate of Full Performance if the proposal is successful. It is important to note that consumer proposals do not affect your credit score and are subject to a 0% interest rate. Do additional reading here concerning the Consumer Proposal process.

 

Once a consumer proposal is approved, it will remain on the credit report for up to three years. This will depend on the type of information and the location of the record. A consumer proposal may remain on your credit report for a few years, but it is possible for you to establish a perfect payment record in three years. However, you should remember that the ability to obtain credit after a consumer proposal is based on your ability to convince the lender that you are a responsible person and can repay your debts.

 

The Consumer Proposal process does not require a court hearing. The trustee will negotiate with your creditors, and if your creditors refuse, they will offer you other options. Once your proposal has been accepted, you will make regular payments according to the terms of your Consumer Proposal until the reduced amount of debt is paid in full. Once the process is complete, your debts will be settled and your creditors will be satisfied with the outcome. You may even qualify for debt forgiveness! Check out this post for more details related to this article: https://en.wikipedia.org/wiki/Bankruptcy.