Duncan Consumer Proposal Information & Alternatives
What you need to know and watch out for.

Consumer Proposal Duncan, BC – Other Options & Stuff You Need to Know

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 Duncan. 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 bankruptcy trustee and costs about $1,500 to file. You pay an initial setup fee, and then, if it is accepted by your creditors, you will pay the remaining balance to proceed. In addition to this, the trustee will also retain 20% of your future payments as a fee for administering your Consumer Proposal. To be legally binding, the creditors who hold the majority of your debt must agree to the proposal. Once they do, you repay the agreed amount over a maximum of 5 years.

Consumer Proposal Advantages and Disadvantages

Consumer Proposals contain certain advantages and disadvantages. These can include the following:

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 Duncan, 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 a permanent public record included on a searchable database
  • It’s more expensive than declaring bankruptcy
  • It must be approved by the Court
  • Creditors can reject the Consumer Proposal – if they do, you may have to offer them additional funds otherwise your proposal will not proceed
  • If you miss more than 2 payments you may need to file for bankruptcy
  • Student loans can’t be included if they are less than 7 years old
  • Secured debts aren’t included
  • Some assets (such as your home, vehicles, or investments) may need to be sold
  • The permanent record of your insolvency can put certain professional licenses at risk and may also affect future employment opportunities

It’s Okay to Ask for Help with Debt

“Life just happened. My debt got to the point where I started to feel like I was drowning. I didn’t feel like I could fix it on my own, and I wanted to start living my life as an adult without debt. I decided to reach out for help. Feeling relieved, I knew that everything was going to be okay – a lot of work – but okay. I had a plan to pay back my debt and continue doing the things I love to do like yoga and travelling.”

– Yasmine, 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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Speak to a Non-Profit Credit Counsellor

Speak with a non-profit Credit Counsellor about your financial situation first. They will be able to review your situation with you and help you explore and understand all your options to deal with your debt.
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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

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 Can Impact Your Credit

Once you enter into a Consumer Proposal, a special notation is placed on your credit report in the public records section. Anyone who you allow to look at your credit report can see the public records section.

Additionally, it is possible that your creditors will report a “7” rating on any debt included in the proposal. This “7” rating means that creditors are receiving your payments through a third party. In this instance the third party would be your trustee. When you send a payment to your trustee, they distribute the agreed upon dollar amounts to all of your creditors once 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.

Call Us to Learn More About Filing a Consumer Proposal in Duncan, BC and Possible Alternatives

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 Duncan at 1-888-527-8999. You can also email or chat with us online right now.

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Putting Your Interests First

Our goal is to always put consumers first and look out for their best interests in everything we do. One way we do this is through transparency and accountability. We are held accountable to the most rigorous standards in our industry.

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North America’s largest association of non-profit credit counselling organizations.
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The Credit Counselling Society provides not for profit credit counselling services in Duncan, BC and is recognized as one of Canada’s leading debt relief services with offices in communities across the country.