when-consumer-proposalIs it possible to eliminate a large percentage of your debts, without even going bankrupt and having to deal with the consequences this bankruptcy could bring? In opting for the consumer proposal, the answer is YES. Here is what this opportunity is all about.

What is a Consumer Proposal?

It is not always easy to repay debts, and even the monthly payment of interest sometimes seems too high! If your budget is too tight to pay back the various amounts to be paid monthly to your creditors, you can make them a consumer proposal.

The consumer proposal is an offer you make to your creditors, offering them to repay only a portion of your debts (credit cards, taxes, various loans, electricity bills and others). If your proposal is accepted, you will be able to repay the amount over a longer period of time while paying a lower monthly fee (and no interest!). This repayment agreement must be made over a period of not more than 5 years.In Quebec, from June 2017 to June 2018, the number of consumer bankruptcies fell by 7.6%, while consumer proposals rose by 6.5% (source). This means is therefore increasingly popular and effective in overcoming debt.

The Requirements for Making a Consumer Proposal

To file a consumer proposal in Montreal, the following conditions must be met:

  • Amount of debts: the amount of your debts must not exceed $ 250,000 (the mortgage contracted to buy your house is not included in the calculation).
  • Bankruptcy or insolvency situation: You must be in bankruptcy OR have more than $ 1,000 in debt and owe more than the value of your assets, while not being able to pay your credit card, Hydro bills and other current bills, as well as your amounts due to tax.

If you are in this situation, it is time to file a consumer proposal by making an appointment with an insolvency trustee.

Consult a Licensed Insolvency Trustee

By making an appointment with a licensed insolvency trustee, you can obtain information about the consumer proposal in Montreal. The financial advisor will help you list your debts and write a proposal that may be acceptable to your creditors. The advisor will then send all the papers to the creditors, and the monthly amount. The trustee’s fees are included in the agreement.

Released from a burden

With the consumer proposal, the harassment of creditors and the stress related to too high debts will be things of the past! Your salary cannot be seized, your creditors will not be able to sue you in court, while your car, residence, RRSP or inheritance will be protected.

Only a note will be included in your credit report, which indicates that you have settled your debts according to a consumer proposal in Montreal. And you will be able to start living a more serene life, free of a heavy burden.