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Consumer Proposals: What to Expect

The reasons people go into debt are different in every case, which is why it should come as no surprise to learn that the process of getting out of debt will also depend heavily on individual circumstances. In some cases, filing for bankruptcy will be the only option; while in other instances, there may be alternatives to bankruptcy that are a better choice.

One alternative to bankruptcy that may be effective is a consumer proposal. To help you decided if a consumer proposal is right for you, learn what to expect when preparing one.

Consumer Proposals Start with a Detailed Financial Evaluation

For a consumer proposal to be effective, we need to determine exactly how large a monthly payment you can afford. To do that, a list of your income, assets and liabilities will be required. Though you could do some of this legwork on your own, it may be best to wait until you have found an administrator of consumer proposals to work with you. This will help you to avoid multiple calls to track down the information you require.

Someone Negotiates with Creditors on Your Behalf

It’s hard to put your fate in someone else’s hands, but when it comes to negotiating a consumer proposal, that’s exactly what must be done. Once we have consulted with you to determine the maximum amount you can afford to pay back each month, we will present your consumer proposal to your creditors. They will then have 45 days to accept or reject your proposal.

Most consumer proposals are accepted, but if it is rejected, we have a couple of options. We can revise and resubmit your proposal, or we consider other methods to help you get out of debt.

It’s Not Easy to Amend Once Finalized

A consumer proposal is not an easy or quick way to get out of debt. Usually, the goal of a consumer proposal is to discharge your debt over the course of several years. It assumes that you will rigorously adhere to the repayment plan, because failure to do so may spell annulment for your consumer proposal.

Because consumer proposals are intended to be long-term plans, you must discuss any foreseeable changes in your financial circumstances with your consumer proposal administrator to determine if this is still a good plan to manage your debt.

The first step to getting ready with a consumer proposal will be finding a licenced insolvency trustee who can prepare one on your behalf. Residents of the BC interior will find our offices conveniently located in Kelowna and Kamloops. Contact us today to get started on your new, debt-free life!

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