Consumer Proposals in Quesnel
Find out what you need to know and what to look out for.

Consumer Proposal Quesnel, BC – Straight Facts and Other Options

What is a consumer proposal, and is it the best option for me?

One option to consolidate your debts is to file a Consumer Proposal in Quesnel. It is a legal process under the Bankruptcy and Insolvency Act between you and your creditors to repay part of what you owe. The amount you repay is largely based upon your income and what you own.

A Consumer Proposal can only be arranged and administered by a licensed bankruptcy trustee and it costs approximately $1,500 to file. You pay an initial setup fee to begin, and then, if the arrangement is acceptable to your creditors, you then pay the balance to continue the process. The trustee you work with will additionally hold back 20% of your future payments as an administration fee. For the Consumer Proposal to be legally binding, your creditors who own the majority of your debt must agree to the proposed repayment plan. If they do, you then have to repay the agreed amount over a maximum repayment period of 5 years.

Advantages and Disadvantages of Filing for a Consumer Proposal

There are definitely advantages and disadvantages to filing a Consumer Proposal. Here are some that are important to be aware of:

Advantages

  • It can reduce the amount of debt you need to repay your creditors by a considerable amount
  • It can be a helpful debt consolidation method in Quesnel, BC if:
    • You cannot afford to pay back all the debt you owe
    • You have steady income
    • Your budget has enough money in it for you to make monthly payments
  • Has the potential to be a good option if:
  • Will put active collection of student loan payments on hold
  • It is one of the final ways of avoiding bankruptcy

Disadvantages

  • It’s not private. A proposal is filed as a permanent public record and is included on a searchable database
  • It costs more than going bankrupt
  • The Consumer Proposal must be approved by a Judge
  • It can be rejected by your creditors. If they reject it, you may have to offer them more money for to
  • Missing more than 2 payments may mean that you need to file for bankruptcy
  • Not all debts can be included (like secured loans)
  • If you stopped being a student less than 7 years ago, your student loans can’t be included
  • Depending on the type of assets you have, some might need to be sold
  • It may affect future employment opportunities, and the permanent record of your insolvency can put certain professional licenses at risk

There’s a Way Out of Debt with Help

“I had just come to the point where I had given up hope – that there’s no way I could ever repay my debt. A friend of mine suggested I reach out, and I thought I’d get some condescending person on the phone lecture me about money, but my counsellor was the most compassionate, caring person who became sort of my own personal cheerleader.”

– Charis, Actual Client

Watch Out for the Big Debt Rip-Off

Consumer Proposals have become the newest way for a growing number of companies and their sales people to take advantage of unsuspecting, vulnerable Canadians. Don’t let this happen to you! A lot of companies offering debt relief are now claiming to provide Consumer Proposals as a great way of getting out of debt. But there’s a problem. Only a government licensed bankruptcy trustee is permitted to file paperwork for a Consumer Proposal. These debt relief companies bill people for thousands in fees only to refer them to a bankruptcy trustee who then charges his or her own fees.

How to Keep from Getting Ripped Off

Follow the tips outlined below, but start by speaking to a member of Credit Counselling Canada (a national association of non-profit credit counselling organizations who don’t work on commission). If a Consumer Proposal is a truly good option for you, one of their agencies will inform you and refer you to a reputable bankruptcy trustee for free.

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Talk to a Not-for-Profit Credit Counsellor

Speak to an accredited, non-profit Credit Counsellor about your financial situation first. They will go over your whole situation with you and take the time to help you explore and understand all your options to resolve your debt problems.
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Only Pay a Trustee for Consumer Proposal Services

Never hand over money to anyone for Consumer Proposal services except a government licensed bankruptcy trustee. The law states that only they are allowed to offer and get paid for these services.
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Watch Out for Consultants on Commission

Find out how the person helping you is compensated. A lot of people who want to advise you on your debts work on commission. Make certain that the “solution” they are recommending is in your best interest – not theirs.

Find Out What Options May Be Available to You
by Answering 9 Simple Questions

Just answer these easy, multiple-choice questions to get a look at your potential options. Within a few minutes, you'll be looking at summarized options and results that apply specifically to your situation.

Discover Your Options

Self Assessment of Debt Relief Options
1. How would you describe your financial situation? Please move the slider along the scale to reflect approximately where you feel you're at.
I can cover all my expenses each month, plus have the ability to save.
 
I can cover my monthly expenses, but I need to borrow, work extra, etc.
 
I can no longer cover all my expenses every month.
 
2. Which of the following best describes you?
3. How stressed do you feel about your debt?
Not stressed
 
Somewhat stressed
 
Very stressed
 

How a Consumer Proposal Impacts Credit

When you make payments on a Consumer Proposal, there is a note on your credit report in the public records section that you have filed a proposal. Anyone who has your consent to see your credit report will see the public records section as well.

In addition, your creditors may report a “7” rating on the debts included in the proposal. This means that they are receiving payments through a third party. The third party is your trustee. When you make a payment to your trustee, they disburse the agreed upon amount to each of your creditors after all applicable fees have been paid.

If you are making monthly payments to secured creditors (like paying for a vehicle loan) outside of your Consumer Proposal, those debts will be reported separately by the creditors that you are paying. If you can create and stick with a realistic budget, then it should make this easier.

If you are able to keep up a good payment history on any secured debts while you are paying off your proposal, this can assist you in re-building your credit more quickly afterwards.

Contact Us for More Information About Filing for a Consumer Proposal in Quesnel, BC

There are quite a number of options between financial difficulty and bankruptcy. A Consumer Proposal might be one good option for some people, but it’s not the best option for everyone. To find out what other options you have, speak with one of our professionally trained Credit Counsellors today, in person or over the phone. Our appointments are free, non-judgmental, and completely confidential.

To ask us some questions or to make an appointment to speak with a Counsellor, phone us in Quesnel at 1-888-527-8999. You can also email or chat with us online right now.

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