What if I Can’t Afford The Consumer Proposal Payments?
Amending a Consumer Proposal:
If you are finding it challenging to make your payments to your consumer proposal as laid out in the agreement of your proposal terms you have several options that your proposal administrator can assist you with.
It is important that you speak with your administrator as soon as you realize you are having trouble, because your administrator will be able to help you further if you contact them earlier rather than later.
There are many reasons for why the payments required under the terms of your proposal are no longer working for you.
You might have lost your job, your hours were cut back, or other unexpected expenses came up.
Fortunately, the law allows amending consumer proposal, which means you can change your proposal with the help of your consumer proposal administrator by rescheduling a maximum of two payments.
The law allows you to only defer two payments, so it is important that you speak with your trustee about whether deferring two payments will be enough to allow you to keep the proposal alive.
It will be important for you and your administrator to determine if your change in circumstances are temporary or permanent.
What are my options if I am struggling with my payments?
If you have missed a payment or two in your proposal, or you feel that you will soon miss a first or second payment you have several options for how to proceed:
• You can contact your proposal administrator about amending a consumer proposal. He or she will work out a proposal amendment to change the terms of your consumer proposal. Your creditors must vote to approve any changes;
• If you have only missed one or two payments you can ensure that you don’t miss a third payment and your administrator will add the missed payments to your proposal payment schedule at the end of the payment schedule;
• You can decide to have your proposal automatically annulled by missing a third payment deliberately;
• You can always save your proposal if you have not yet missed three payments if you so desire to; you may also elect to voluntarily have your proposal cancelled.
If you have a temporary change in your financial situation you can likely defer a payment or two and get yourself back on track, or work out a plan to spread the missed payments over a period of time.
For example, if you miss 2 payments of $250 (or $500) you can make an agreement to add $50 a month to your payments for the next 10 months.
With a more permanent change to your financial security, you might have to discuss the amending consumer proposal with your trustee / proposal administrator.
For example, if your proposal calls for a payment of $300 a month, you can work with your trustee to possibly make an amendment to your proposal terms, such as changing the terms of the proposal to $200 a month.
Your creditors must agree to the terms of the amendment to the terms.
If you have lost your job or are facing a long-term financial challenge, you might need to file bankruptcy to deal with your debts.