Pembroke Consumer Proposal Information & AlternativesWhat you need to know and watch out for.Consumer Proposal Pembroke, Ontario - Other Options & Stuff You Need to KnowWhat is a consumer proposal, and could it be the best option for my situation?If you are looking to consolidate your debts, one option available is to file a Consumer Proposal in Pembroke. This is a legal process governed by the Bankruptcy and Insolvency Act between yourself and your creditors to pay back a portion of the debt you owe. The amount of debt that you repay is mainly based on your income and what assets you own.A Consumer Proposal can only be arranged and administered by a licensed bankruptcy trustee and it costs approximately $1,500 to file. You pay an initial setup fee to begin, and then, if the arrangement is acceptable to your creditors, you then pay the balance to continue the process. The trustee you work with will additionally hold back 20% of your future payments as an administration fee. For the Consumer Proposal to be legally binding, your creditors who own the majority of your debt must agree to the proposed repayment plan. If they do, you then have to repay the agreed amount over a maximum repayment period of 5 years. The Advantages & Disadvantages of Filing a Consumer Proposal in OntarioThere are some clear advantages and disadvantages of filing for a Consumer Proposal. They include the following:AdvantagesIt can reduce the amount of debt you need to repay your creditors by a considerable amountIt can be a helpful debt consolidation method in Pembroke, Ontario if:You can't afford to repay all of what you oweYou have stable incomeYou have enough money in your budget to make monthly paymentsIt will pause active collection on student loan paymentsCan be a good option if:You don't qualify for a debt consolidation loanIf you have debts (like high government debt) that can't be included in a debt management programIt is one of the last ways to avoid bankruptcyDisadvantagesIt's not private. A proposal is filed as a permanent public record and is included on a searchable databaseIt costs more than going bankruptThe Consumer Proposal must be approved by a JudgeIt can be rejected by your creditors. If they reject it, you may have to offer them more money for toMissing more than 2 payments may mean that you need to file for bankruptcyNot all debts can be included (like secured loans)If you stopped being a student less than 7 years ago, your student loans can't be includedDepending on the type of assets you have, some might need to be soldIt may affect future employment opportunities, and the permanent record of your insolvency can put certain professional licenses at riskThere's a Way Out of Debt with Help"I had just come to the point where I had given up hope \u2013 that there\u2019s no way I could ever repay my debt. A friend of mine suggested I reach out, and I thought I\u2019d get some condescending person on the phone lecture me about money, but my counsellor was the most compassionate, caring person who became sort of my own personal cheerleader." - Charis, Actual ClientWatch 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 OffFollow 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. \tSpeak to an accredited, non-profit Credit Counsellor about your financial situation first. They will go over your whole situation with you and take the time to help you explore and understand all your options to resolve your debt problems.Never pay money to anyone for Consumer Proposal services except a licensed bankruptcy trustee. By law, they are the only ones allowed to provide these services and receive payment for their services.Ask how the person helping you is compensated. Many people who will seek to advise you on your debts work on commission. Make sure the "solution" they are suggesting is in your best interest - not theirs. How a Consumer Proposal Can Impact Your CreditOnce you begin making payments on a Consumer Proposal, a note is placed in the public records section of your credit report that states that you have filed a proposal. Anyone who you have given permission to see your credit report can also see the public records section.Your creditors may also report a \u201c7\u201d rating on any debt included in your proposal. This rating indicates that they are receiving your payments through a third party. In this case, your trustee is the third party. Your monthly payment on your Consumer Proposal is remitted to 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. Contact Us for More Info About Filing for a Consumer Proposal in Pembroke, OntarioThere 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 Pembroke at 1-888-527-8999. You can also email or chat with us online right now.Related Articles of InterestYou may find some of these articles to be helpful. There are more alternative debt consolidation options and services available than most people are aware of. Find the option that's right for you.Find out how a Debt Management Program consolidates your payments, reduces your interest rates, and gets you out of debt.Learn how Consumer Proposals and Bankruptcy are similar and how they are different. Also learn what you need to watch out for.Putting Your Interests FirstOur 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. Related LinksThe Office of the Superintendent of Bankruptcy for OntarioList of Licensed Bankruptcy TrusteesInsolvency Terms & What They MeanCredit Counselling Society Ontario office locations The Credit Counselling Society is an award winning, non-profit credit counselling service provider in Pembroke, Ontario with 22 offices in communities across Canada.