The benefits of a consumer proposal

Have you been finding it increasingly difficult to repay your debts, and have you noticed warning signs of financial trouble? Has your financial institution denied you a loan, and do you want to avoid bankruptcy? In that case, a consumer proposal might be a very appealing solution for you.

The advantages of a consumer proposal

When debts become increasingly difficult to repay, more and more people are turning to a consumer proposal, which offer the following advantages:

1. Reduces the amount of your debts into a single, interest-free payment.
2. Protects you from your creditors.
3. Allows you to keep all your assets.
4. Balances your budget and gives you a fresh start, debt-free.

Since every situation is unique, analyzing your financial situation is essential to making an informed decision and choosing the best solution for you. Let’s take a detailed look at the main benefits of a consumer proposal:

1. Reduction of your debts and a single, interest-free payment
   The amount offered in your consumer proposal is determined based on your financial capacity and the value of your assets. That said, a proposal usually allows for a significant reduction in the amount of your debts, often by 50% or more. Additionally, since the law stipulates that no interest is charged on the amount offered, the resulting monthly payment in your proposal will be much lower than the total payments you are currently making on your debts.
2. Protection from your creditors
   Once the consumer proposal process is initiated, creditors and collection agencies are legally required to stop contacting you. With a few exceptions, you will be done with lawsuits, asset seizures, or wage garnishments. What a relief! Furthermore, for a proposal to be accepted and include all your unsecured creditors, it only requires a simple majority vote from creditors. This rule means that all your creditors will be bound by the proposal, even those who are against your proposal.
3. Allows you to keep your assets
   A consumer proposal will enable you to keep all your assets, such as your house or car, as long as you continue making payments according to the proposal’s terms. However, you also have the option to dispose of an asset if you wish. For example, if the car you own is too expensive for you, before filing your proposal, you can choose to return it, and any loss incurred by the creditor financing the car will be included in your proposal.
4. Balance your budget
   From the moment you file your consumer proposal, you will stop making monthly payments on your unsecured debts (credit cards, lines of credit, personal loans, etc.). These savings will allow you to cover expenses in your budget and set aside an amount that will be offered to your creditors as part of the proposal we will make to them.

All these advantages make a consumer proposal a very attractive solution for those looking to get out of debt without declaring bankruptcy and minimizing disruptions in their financial and personal lives.

Interested in the benefits of a consumer proposal?

If you would like to learn more about a consumer proposal, you can get a free, informational meeting. Obtaining a clear picture of your financial situation and possible solutions is simple and efficient. The meeting can be conducted by phone, video conference, or in person, according to your preference. Just fill out this form to schedule an appointment at your convenience or call 1-877-777-2433.

By Pierre Fortin
Jean Fortin & Associés
Personal Finance Advisor
Licensed Insolvency Trustee