Understanding the Details of a Consumer Proposal in Vancouver

A Consumer Proposal is a legally binding process governed by the Bankruptcy and Insolvency Act that can only be administered by a Licensed Insolvency Trustee (“LIT”). It is available to individuals who have total debts of less than $250,000 (excluding mortgage secured by principal residence).

Advantages of Consumer Proposal

Opting for consumer proposal can have the following benefits:

  • Interest charges are stopped, starting from the date the proposal will be filed.
  • You will have to pay just a portion of the debt.
  • The maximum term for debt repayment is 60 months.
  • Creditors will no longer be able to harass you.
  • Mostly, you will be able to keep most of your assets - please discuss the applicable exemptions with the LIT.

How the Consumer Proposal Works

The consumer proposal is very flexible and can be based around your financial situations. A proposal will be in the form of an offer to pay your creditors a percentage of what is owed to them, a request to extend the time you have to pay your debts, or both. If your proposal is accepted by your creditors, the OSB or any interested party will have 15 days to ask the LIT to apply to Court to have the proposal reviewed. If no request is made, the proposal will be regarded as accepted by the Court. Once the terms of your proposal have been fulfilled, you will be issued a Certificate of Full Performance, and you will be legally released from the debts included in your proposal.

To find out if a Consumer Proposal is the right choice for you, please contact one of the professionals at Crowe MacKay & Company. We will evaluate your financial situation and explain the pros and cons of the various options available that could help you solve your financial problems. We are here to help.

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