How to calculate Consumer Proposal amount?
I owe a Canadian bank $21,000 (Visa and Line of Credit), have no other debts, and have to choose between filing bankruptcy or a consumer proposal.
Would you have a ballpark idea of what percentage of this amount a bank might accept at the moment if I were to try to file a proposal?
Would there be additional fees charged by the trustee, or does their payment come out of the proposal amount?
Also, if you don’t mind, Is having filed a consumer proposal considered having been “insolvent” in Canada?
The consumer proposal payments must be more than your creditors would receive if you have gone bankrupt.
In most cases, a consumer proposal means you will repay about 30% of the debt that you owe.
However, every proposal is different and you will have to see a trustee and get a confidential evaluation to provide the trustee with all the information you can.
The trustee can then advise you how to proceed once he has a full understanding of your financial situation.
The trustee fees come out of the payments you make on the consumer proposal.
The credit bureau uses the code R7 to denote a person under a consumer proposal and R9 for a person in bankruptcy.
– Earl Sands, Licensed Insolvency Trustee