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What to Choose Between A Consumer Proposal and Bankruptcy?

What to Choose Between A Consumer Proposal and Bankruptcy?

by | Bankruptcy, Budgeting, collection calls, Consumer Proposal, Credit Counseling, Debt, Insolvency

The major difference between the consumer proposal and bankruptcy is that the consumer proposal gives the person more rights on their assets. It means that the person can learn more of their assets. And also, it has less effect on the credit score of a person. That can stay of only three years in comparison to 6 years of the bankruptcy. But both of the solutions are made to clear out the debt on the person. In a consumer proposal, the person gives some percentage of amount of debt money. And can hold more of their assets. Then pay the rest amount after some time. Or can be paid monthly or annually depends on the condition of the person.

Whereas in bankruptcy, the asset will be sold out. And from selling those assets the debt amount will be cleared. But in a consumer proposal, not many items will be sold. The person needs to pay some percentage of the debt amount to the creditor and can possess more of their assets. And the rest amount which will be paid monthly or something will be decided by the committee. It depends upon the income of the person and what the person has in their asset list. So, just choose wisely which one to go with.

According to the experts, the consumer proposal is good to go with

Many financial experts suggest that consumer proposal is the best solution in, debt relief solution. Because in consumer proposal the person needs to pay some fixed amount decided by the person and the creditor. And it is good so, even a person is making some more money at some time. They only need to give only a fixed portion of their money. And it also allows possessing more assets. So, it is better to go with it.

Consumer proposal mainly have a lower monthly payment

In a consumer proposal, the monthly payment is always lower. But when a person filed bankruptcy, they need to show the trustees about their growth in income. And that could trigger the surplus charges on recovering the debt amount. While in a consumer proposal, the monthly amount doesn’t change and is less than bankruptcy.

Get help from the professions

Always take help from the professional. Because they are the person who regularly deals with such a case. So, it is better to ask their advice on this case. In case of you have credit or debt issues visit www.gtacredit.com or call 416 650 1100

What is A consumer proposal?

What is A consumer proposal?

by | Bankruptcy, Budgeting, collection calls, Consumer Proposal, Credit Repair, Insolvency

A consumer proposal is nothing but a plan which provides debt relief to Canadians who are struggling with money debt payments. It is sectioned by the Canadian government so that their people can have some relief in debt payments. And it was a very important step that took by the Canadian government because many people suffer from money debt payments. And in the end, they have to file bankruptcy, which was not good for any Canadian people. So, the government thought to give some relief to their people and sectioned this act.

By using this act, the consumers now have some relief in paying the debt amount. In a consumer proposal, a legally blind debt settlement agreement is filled between the consumer and the creditor. But this proposal can only be filled with licensed insolvency trustees. So, the consumer can pay some debt amount to get full debt forgiveness. And the amount is decided by the trustees on the basis of the consumer’s income and what consumer’s own. This is the consumer proposal.

 

All the settlements are the same or different

Not all the settlements are the same each and every settlement is unique in its own way. Because the settlement amount, which is decided by the trustees, is mainly depended upon the consumer’s income and their possession. So, the settlement amount will also be different in every case. The same amount is not applied to every person. And that is why it is very popular among consumers.

Eligibility criteria for the consumer proposal

There are mainly four things that everyone should keep in their mind before filling the consumer proposal. And that is

  • First thing first, the consumer must be a residence of Canada. That thing is not necessarily the person can be permanent resident of Canada or must be residing in Canada for some work or anything else.
  • The consumer must have some amount to pay some portion of the debt amount.
  • The debt amount should be less than $250000.
  • The consumer must not be able to pay their debts in order to apply for a consumer proposal.

Is it okay to go with a consumer proposal?

Of course, it is good to go with a consumer proposal. If the consumer doesn’t have the money to pay their debts, then they should go with it and have some relief on debt payment.

In case of you have credit or debt issues visit www.gtacredit.com or call 416 650 1100