Consumer Proposals in Airdrie
With the cost of living continuing to rise in Alberta, it’s not surprising that a significant number of people are facing financial problems. As many residents face a drop in income 2020, the debt crisis currently consuming Canada could be set to worsen. Due to this, more adults will be forced to consider formal debt solutions, such as bankruptcies and consumer proposals.
What is a Consumer Proposal?
A consumer proposal is a form of insolvency. When you file a consumer proposal and it is agreed by the majority of your creditors, it can significantly reduce the amount you need to pay back. It’s not unusual for debts to decrease by 65-70% when a consumer proposal is in place. With the potential to reduce your total outstanding debt by two-thirds, it’s easy to see why so many people are considering filing consumer proposals in Airdrie.
However, reducing your total debt isn’t the only advantage of filing a consumer proposal. In addition to this, creditors are prevented from adding interest to your accounts or pursuing you for more payments. Furthermore, any wage garnishments will cease once your consumer proposal is filed.
Although a consumer proposal remains on your credit file for some time after you’ve finished making payments, it is possible to rebuild your credit rating. In fact, it can be easier and quickly to improve your credit rating after filing a consumer proposal than it is to struggle on and attempt to deal with debts yourself.
How to File a Consumer Proposal
Despite being an increasingly popular form of debt resolution, few people understand how to file a consumer proposal. As the process is governed by the Bankruptcy and Insolvency Act, there are certain criteria which must be met. However, you won’t need to worry too much about formulating your proposal in accordance with the relevant regulations.
All bankruptcies and consumer proposals in Airdrie must be handled by a licensed insolvency trustee (LIT). This means a regulated professional will oversee the process from start to finish and ensure it meets the relevant legislative requirements. In addition to this, your LIT will be on hand to answer any questions you have and will take the time to ensure you understand what everything means and what your obligations are under the agreement.
Remember – filing a consumer proposal is a voluntary decision, so you will never be under any pressure to move forward with this form of debt proposal. Learning more about how consumer proposals in Airdrie work simply gives you the knowledge you need to make an informed decision. Similarly, you won’t be pressured into agreeing to terms you’re not completely happy with or clauses that you feel unsure about.
Making Consumer Proposals in Airdrie
If you decide filing a consumer proposal is the best way to address your financial problems, your licensed insolvency trustee will begin preparing a proposal that’s fair to you and your creditors. To help them do this, you’ll need to supply as much information and documentation as you can.
Once the proposal is completed, you’ll be asked to read through it and sign it, if you’re happy with it. Of course, you can ask your LIT to clarify any points at this stage or make any changes you think are necessary.
Following this, your proposal is filed with the Office of the Superintendent of Bankruptcy (OSB) and notifies your creditors. Your creditors have 45 days to review your proposal and oppose or accept it. Creditors also have the right to hold a meeting to discuss your proposal, although this isn’t always necessary.
Not all your creditors need to agree in order for your consumer proposal to be accepted. Providing creditors that are owed 50% of more of your total debt accept the proposal, it becomes binding on the remaining creditors.
At this point, the consumer proposal is finalized, and you can begin making the pre-agreed monthly repayments and fulfilling any other obligations. For example, most consumer proposals require you to attend at least two credit counselling sessions within a specified time frame. Providing you satisfy your duties; you will be discharged from your consumer proposal once it has been completed.
Contact Bankruptcy Canada Now
If you’re struggling to manage your debts and you’d like support, get in touch with our team today. We can help you to learn more about the various debt solutions available to you. Call Bankruptcy Canada at (877) 879-4770 now.