Consumer Proposals

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If you are a resident of Abbotsford, British Columbia, have found yourself in financial trouble, and are considering a consumer proposal, there are a number of things you’ll want to know before going ahead with the process.

• Consumer proposals are ideal for people who have a stable job, who make decent pay, and who can afford to make payments, but need extra time to do so.
• Consumer proposals are also good for those with debts in excess of $5,000.
• A consumer proposal is like a debt management plan; only a consumer proposal is legally binding and is administered by the courts and a licensed bankruptcy trustee in Abbotsford.
• Advantages include a maximum period of 5 years, it is usually accepted by creditors, interest is immediately frozen, you can negotiate to pay only a fraction of the debt, wage garnishments end, and your creditors cannot pursue legal action.
• At the start of the process, your bankruptcy trustee will evaluate your financial situation and figure out what kind of monthly payment you can manage.
• If the number agrees to both you and your creditors, the trustee will file the proposal.
• Your creditors have 45 days to vote for or against your proposal. If 50% or more vote in favor of the proposal, it is considered adequate for all creditors. Usually your creditors will accept your proposal. They’d receive even less money if you filed for bankruptcy.
• If 25% or more of your creditors do not vote in favor of your proposal, your trustee will call a meeting of creditors to re-discuss the proposal. It is mandatory that you attend this meeting.
• Fifteen days later, if nobody protests; your proposal will be approved by the court. You and your creditors are locked into the terms of the proposal from that day on.
• In Abbotsford, you are permitted to miss as many as two payments during the proposal period. Your trustee will just attach two payments onto the end. However, if you miss any more than two, the proposal collapses and is annulled by the court. Your creditors can then apply to have your wages garnished, and interest charges are applied to all debts dating back to the date you filed.
• Your credit rating will be immediately changed to reflect your financial situation, and will probably stay that way until the proposal is finished. A note will also remain on your credit report for seven years starting from the date that you filed.
• The Superintendent of Bankruptcy will determine the trustee fees. In most cases, your trustee is paid from the proceeds of your proposal.
• If you are experiencing financial trouble, and believe a consumer proposal is your best option, please contact us immediately. Our bankruptcy trustees in Abbotsford offer initial consultations free of charge. We will discuss your personal situation with you, and help you select the best possible alternative.

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