A Consumer proposal is a legal process that enables the debtor to restructure their financial affairs. The proposal creates an opportunity for the debtor to make reasonable, interest-free payments to creditors’ for up to five years. The debtor will then be able to retain all assets and avoid bankruptcy.
Let’s explore the advantages and disadvantages of Consumer proposal.
A Consumer proposal is a legal process that enables the debtor to restructure its financial affairs. The proposal creates an opportunity for the debtor to make reasonable, interest-free payments to creditors’ for up to five years. The debtor will then be able to retain all assets and avoid bankruptcy.
Let’s explore the advantages and disadvantages of a Consumer proposal.
What are the advantages of a Consumer Proposal?
A consumer proposal is an ideal choice of persons who do not want to file for bankruptcy. A proposal to creditors is not the same a filing for bankruptcy, even though they are governed under the Bankruptcy Act in many jurisdictions.
The debtor is required to attend two mandatory counseling sessions pertaining to budgeting, money management and credit education. These sessions not only help you determine what went wrong, but it will also help you find new ways to budget, pay bills and spend money. These counseling sessions ensure that the same financial situation is avoided in the future.
What are the disadvantages of a Consumer Proposal?
A consumer proposal will have a negative impact on your credit score. Once the certificate of completion has been obtained, the credit can be re-established and the credit will recover with time.
Do not despair! If consumer proposal is not be the right option for you, there are more effective options that enable you get out of debt faster.
What can we do for you?
We will tell you if making the consumer proposal is the right solution to get out of debt. We will represent you with the trustee to get the best terms possible and comply with the consumer proposal terms and conditions.
Click here to find out if a consumer proposal is the right option for your current financial circumstance.