Please Stop Paying for Consumer Proposal Representation
Consumer Proposal Advice is Free!
Up and down the country, thousands of innocent Canadians who are simply trying to get out of debt, are being ripped off by unlicensed debt advisors who are charging them a fee to refer them to a Licensed Insolvency Trustee who will then handle their consumer proposal request – Don’t fall for the trap!
You would never dream of paying someone a substantial fee, often as much as 40%, to refer you to a counsellor, a doctor or a dentist, so why pay someone to refer you to a Licensed Insolvency Trustee?
People who have been caught in this cruel and unnecessary trap have found themselves forking out thousands of dollars more than they need to in order to file their consumer proposal, worsening their financial situation, and fattening the pockets of those taking advantage of them.
It’s time to stop paying for consumer proposal representation.
Where are they going wrong?
Being in debt can be very scary, and making the decision to reach out for help can be very hard for people to come to.
When the decision is finally made to seek assistance with their financial situation, a quick online search will bring up thousands of people offering to help them get out of debt, many with flashy websites and uplifting case studies about their clients becoming debt-free.
But behind the sparkling facade, many unlicensed debt advisors only have one thing on their mind – lining their own pockets.
Of course, this is not true for all advisors in the industry, and many are genuinely trying to help people to regain financial freedom, but it can be very difficult to tell the good from the bad and where a person’s motivations truly lie, causing many people to fall into the trap and to pay above and beyond for debt relief services.
Why you should never pay for consumer proposal representation
A consumer proposal under the Bankruptcy and Insolvency Act is a legally binding agreement between you and your creditors and MUST be filed by a Licensed Insolvency Trustee.
Debt-advisors may be able to offer advice about the consumer proposal process and to help you decide if it is the right route for you, but they cannot file a consumer proposal on your behalf and will be charging you a fee for advice that you could get for free directly from a Licensed Insolvency Trustee.
Why not cut out the expensive middle man?
Across Canada, Licenced Insolvency Trustees offer free consultations to those looking to get out of debt, including providing a full debt assessment which involves looking at a person’s income, assets and what they owe to their creditors.
If more than one consultation is needed between you and a Licensed Insolvency Trustee, then additional free consultations can be offered until all of the material needed to file your consumer proposal has been collected.
You should not be asked to make a payment until your proposal has been legally filed.
You could be paying a number of hidden fees
In addition to paying a fee for unnecessary advice that you can get for free from a Licensed Insolvency Trustee, many debt advisors use complicated language in their agreements to make it appear as though they are doing more during the consumer proposal process than they actually are.
This includes things like ‘preparing your proposal’, ‘negotiating with your creditors’ and ‘stopping creditor calls’, when in fact, they are not able to do any of those things, and they are actually being undertaken by a Licenced Insolvency Trustee who you will be paying separately.
By making it appear as though they are providing you with these services, debt-advisors are able to trick you into paying their hidden fees, when in fact, you could be getting the very same service from working with a Licenced Insolvency Trustee alone – you’re essentially paying for the same services twice!
If your debt-advisor is claiming to be reaching out to your creditors, to be able to stop creditor calls or to be putting together your proposal, then they are lying to you and you are being tricked.
You could end up making your debt worse
By the time you’ve added on the extra and unnecessary fees imposed on you by your unlicenced advisor, your total debt and repayment amount could have increased by as much as 40%!
What’s more, it is not uncommon for unlicenced advisors to request monthly repayments of their fees before the commencement date of your proposal, meaning that you will be paying for their services before your proposal has even been written or filed.
From our experience in the industry, we know that this additional pressure imposed by debt-advisors often causes people to turn to cash-advances, further credit cards and payday loan lenders, making their situation worse.
You should never have to pay for your consumer proposal before it has been filed.
You could end up losing your money
One of the ways in which unlicensed debt advisors lure innocent people into their traps is by offering magical guarantees that make them look credible.
When these guarantees are unpicked, it often turns out that they aren’t really offering much of a guarantee at all.
It’s impossible to offer a 100% guarantee that your consumer proposal will be accepted, and you need to read the fine print about refunds too.
In our experience, the vast majority of proposals are successful because the creditors know that the alternative is that the debtor files bankruptcy and they are likely to reclaim even less of what is owed to them.
But that being said, a rejection is not unheard of.
If your proposal is rejected and the whole process fails completely or you decide to file elsewhere, then you could lose all of the money that you have already paid in upfront fees to your advisor, effectively tying you into their service for the long haul whether you like it or not.
Over the years, we have seen many people come to us having been in this situation, ultimately losing hundreds if not thousands of dollars in upfront fees that they have paid for a consumer proposal agreement that has ultimately failed.
It doesn’t matter who the work for
Another of the selling points used by unlicensed debt-advisors is to market themselves as working for you, the debtor, and not for your creditors, as if this means that they can somehow get you a better deal.
We’ll let you in on a secret – it doesn’t.
Claiming to work for you and not your creditors is just clever sales talk, and at the end of the day it doesn’t matter who they claim to work for, the important thing is that you come out with an accepted consumer proposal agreement that you can afford to repay over the agreed time period.
Your Licenced Insolvency Trustee will look closely at your financial situation, what you owe and how much you can afford to repay, to ensure that your creditors are getting a better deal that they would if you were to file for bankruptcy, increasing your chances of the deal being accepted, whilst still ensuring that you are not paying more than you can afford.
When it comes to debt relief services, there are no sides.
Please Stop Paying for Consumer Proposal Representation
If you’re in debt and are looking to file a consumer proposal, then please, whatever you do, do not get tied into paying for consumer proposal representation that you really don’t need.
If you’re unsure as to where to turn and don’t know how to find a Licenced Insolvency Trustee yourself, then we at Bankruptcy Canada are here to help.
By giving us a call or filling out our contact form, we can put you into contact with one of more than 430 Licenced Trustees who partner with us from all over the country.
We understand that meeting with a Licenced Insolvency Trustee can be scary, but we want to assure you that we have only partnered with the very best.
Having reached out to us for help, we will connect you with one of our trusted trustees who will then meet you in confidence and privacy to carefully evaluate your financial situation and to explain all of your debt relief options.
All of our consultations are 100% cost-free, and we will never ask you for any upfront payments.
Together, you and your Licenced Insolvency Trustee will be able to decide the best solution for your situation, and you can rest assured that you will never be forced down a path you do not want to take.
So if you’re ready to get out of debt for good and want to avoid paying more than you need to for your consumer proposal, then reach out to us today on (877) 879-4770 or by filling out our contact form here.
We are here to help.