My Positive Experience with a Consumer Proposal
How a Consumer Proposal Helped Me
In 2013, I decided to start my own business.
I had everything lined up, and took out some credit to help me get things off the ground.
I created a business plan which outlined the milestones I needed to achieve in order to stay afloat and for a few years, everything went well.
Then, things took a turn for the worst.
Business plummeted, it became harder and harder to remain competitive and I soon realised that I needed to invest more in my company, so that I could raise my income ceiling.
So I did.
I took out a new line of credit, even though my old one hadn’t been paid off in-full and hoped to get things back on track again.
Although investing in my business did work, it didn’t give me enough financial income to repay my debts, and my home expenses.
I soon realised that, all of a sudden, I was not able to make the repayments I have and that I was in a bind.
I used credit cards to pay for my weekly shopping, and to buy inventory for my company.
Things spiralled from there and I had big debts to numerous credit providers.
I grew sick of the endless phone calls, letters and hassle and decided that I needed to take action.
That’s when I chose to get in touch with Bankruptcy Canada.
I was scared of losing my home, and my interest rates were anything but favourable with the debt that I had.
In fact, at times, it felt as though I was paying more in interest than I was off my cards.
I felt embarrassed, but I knew that I had to take this next step.
If I didn’t, I would not only lose my business, but also my home and everything that I have worked so hard for over the years.
Speaking to an Administrator at Bankruptcy Canada
I spoke to Bankruptcy Canada and felt nothing but shame, but the advisor immediately made me feel as though I was not alone in my situation.
They explained that the situation I was in, was in fact, very common and it was caused by the way finance works.
Credit cards are handy, but at the end of the day, the lender knows that a lot of people won’t actually be able to pay in the end, especially small business owners.
After all, most small businesses fail within the first 5 years of operation, and mine was about to become one of them.
The advisor talked me through something called Consumer Proposal.
They said that because I had an income through my business, and that it was good enough, I could go down this route and still have enough for my other personal expenses.
I immediately felt better and felt as though it was possible to save everything that I had worked endlessly to achieve.
The next step was for me to make a list of the income I have, and the bills I’m paying.
The advisor showed me everything that the creditors would be able to see.
The monthly payment was small, which meant that I could continue funding my business without being laden down by debt.
The proposal got sent to the creditors.
I was advised that the wait time can be around 50 days, but I was determined that I wouldn’t get accepted.
After all, the payments I was making were so low, and the fact that I’m a small business owner surely put me at some degree of risk.
The companies who voted on the proposal all gave me a thumbs up, and my advisor said that this isn’t rare at all.
Consumer proposals usually have a very high acceptance rate.
I was able to make a very low payment over the space of 5 years and everything went perfectly fine.
I will say that you need to make sure that you have the funds to make the payments on a consumer proposal.
One thing that I love about consumer proposals is that if you have the funds, or if your income goes up at some point then you can pay the Consumer Proposal off early.
That’s what happened with me. I was able to make the payments very early compared to what I thought, and I was able to clear the entire debt in 3 years rather than 5.
I’ve come out of the other side- my business is thriving and I’m now able to manage my money much more efficiently.
I’m very proud to say that I’m now debt-free and this is something that I would recommend to just about anyone who is in a bind like I was.