If you are currency overwhelmed with debts, it is important to know that you don’t have to be burdened with them forever.
After booking an appointment with one of our Licensed Insolvency Trustees, we will go through the various debt solutions with you.
It might be that a Consumer Proposal is the best option, so to help you learn more about the process involved, read our short guide below.
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Filing A Consumer Proposal: Understanding The Process
A number of stages are involved within the process, and these are as follows.
Meet With A Licensed Insolvency Trustee
The first step on your journey towards a debt-free life is to meet with one of our Licensed Insolvency Trustees.
At the meeting, your Trustee will get to know more you and your financial situation, and they will explore the various debt relief options that are open to you.
If, after discussing your debt and finances with you, it is agreed that a Consumer Proposal is right for you, the process of what is involved with be discussed in more detail with you.
If you still want to go ahead, the following stages will form a part of the process.
Prepare The Consumer Proposal
Your Trustee will help you prepare a proposal to your creditors.
It will outline the amount you can reasonably afford to pay them, how much you will be able to pay on a monthly basis, and the time period needed to repay your debt.
Your Trustee will file all the necessary documents with the Office of the Superintendent of Bankruptcy (OSB).
These will include a Statement of Affairs (a sworn declaration of your income and expenses, debts, and assets), and the Consumer Proposal itself.
Your Trustee (also known as the Administrator during the process) will also prepare a report explaining the proposal to your creditors and will make the necessary arrangements to halt any legal proceedings and wage garnishments that may have been instigated by your creditors.
It is important to note that Consumer Proposals can’t last for longer than five years, so you will have an end in sight if the proposal is agreed upon.
You might still have debt owing after this time, but if your creditors agree to the proposal, the rest of your debt will be written off.
Wait On Your Creditors
Your creditors have 45 days to review the Consumer Proposal.
During this time, you won’t have to make any payments to them, interest on your debts will be halted, and you will be free of harassment from your creditors.
If the proposal is accepted, the next stage will begin.
If it isn’t, a creditor’s meeting will usually be called to amend the proposal.
You will have to attend the meeting, but your Trustee will guide you through the steps involved and will work with you and your creditors to come up with a proposal that suits all parties.
If the majority of your creditors accept the Consumer Proposal, and if there are no objections within 15 days, it will be legally approved by the court.
It then becomes a legally binding document between you and your creditors, and payments towards your debt will begin.
Fulfill Your Consumer Proposal Duties
You will need to make the payments that have been outlined in the proposal to your Trustee.
They will be responsible for handing out these payments to your creditors.
You will also be required to attend two counselling sessions with your Trustee.
These are designed to help you manage your finances, give you guidance on rebuilding your credit rating, and give you the skills and knowledge needed to avoid debt in the future.
If you stick to the repayment plan, you will eventually pay off the Consumer Proposal in full.
At this point, you will receive the Certificate of Completion and you will be released from the majority of the debts you owed at the beginning of the process (there are minor exceptions, but your Trustee will explain these to you).
If you fail to meet the agreed terms of your Consumer Proposal and/or miss three months of payments, the proposal will be annulled.
It is still possible to make amendments to the proposal if you are having difficulty making payments, but these need to be done before three proposal payments are missed.
Be sure to speak to your Trustee if you know you are struggling, as the sooner you let them know, the sooner the proposed amendments can be suggested to your creditors.
Start Your Debt-Free Life
Once you have fulfilled the terms within the Consumer Proposal, your Trustee will file the paperwork needed to release you from your debts.
They will provide you with the information and resources you will need to rebuild your credit and manage your financial future, and will answer any further questions you might have for them.
You will then have the opportunity to focus on your debt-free life.
Using the advice you have been given by your Trustee, it will be your responsibility to manage your budget and make the necessary changes to your lifestyle to give you the opportunity to remain free of debt.
So, if you’re currently struggling with debt, you might want to consider a Consumer Proposal.
With the opportunity to be free of debt within 5 years, you will be able to say goodbye to your stresses and creditors forever.
Get in touch with us today and book a free consultation with one of our Licensed Insolvency Trustees.
It might be that a Consumer Proposal is right you, although your other options will be discussed with you as well.
Call us at (877) 879-4770, or fill out this consultation form, and start out on your journey towards a debt-free life!
Information on Consumer Proposals
Consumer Proposals in Canada – An Alternative to Bankruptcy
What is a Consumer Proposal?
What are the Benefits of a Consumer Proposal?
What are the Steps in a Proposal?
What Debts Are Erased in a Consumer Proposal?
Is There Life After a Proposal?
Consumer Proposal Eligibility
How to Amend a Consumer Proposal