These 3 Things Will Happen After You File a Consumer Proposal

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If you are an individual and your debts do not exceed $250,000 (not including the mortgage owed on your home), the Government of Canada states that filing a consumer proposal may be a good option for you. A formal, legally binding process, a consumer proposal can be filed with the assistance of a Licensed Insolvency Trustee (LIT), who will work with you to develop a proposal that outlines how much you can reasonably pay back your creditors.

filing a consumer proposal to regain control of your finances

After drafting your consumer proposal with the assistance of your LIT, here is what will occur:

1.   Your LIT will file the consumer proposal you created with the Office of the Superintendent of Bankruptcy (OSB). After this happens, you will no longer make payments to your unsecured creditors. Your creditors will also have to stop garnishing your wages and relinquish any lawsuits against you at this point.

2.   After providing the OSB with your consumer proposal, your LIT will then submit this document to your creditors. This report will contain a general overview of your financial situation and why you are having trouble making your payments.

3.   Once it is received, your creditors must either reject or accept the proposal within a 45-day period. If a meeting of the creditors is held, your creditors can choose to provide notice of acceptance or rejection at this time.

Are you interested in filing a consumer proposal to regain control of your finances? At Morgan & Partners Inc., we can provide assistance, so please contact us today.