Consumer Proposals and Crushing Debt
If you are overwhelmed by your debt load and simply do not have the income or resources to repay your debts – bankruptcy can seem like the only way out.
In Ontario, however, there may be another way to deal with your crushing debt – a consumer proposal.
If you are unable to repay your overwhelming debts in a reasonable time-frame, you may qualify for a consumer proposal.
A consumer proposal will enable you to enter into a legally-binding agreement with your unsecured creditors to repay a portion of your unsecured debts over a period of up to 5 years.
During a proposal, those creditors who are covered by your proposal will have to stop all their collection efforts such as calls, garnishees, legal actions, etc. As well, they will have to stop charging interest on the outstanding balances.
Note: while most unsecured debt like credit card debt, payday loans, income taxes, etc can be included in your proposal, there are some like child support, court fines, some student loans etc that cannot. Your trustee will go over all of this with you in detail.
Finding Out if You Qualify for a Consumer Proposal
In Ontario, only Licensed Trustees in Bankruptcy (such as David Sklar & Associates) are permitted to file and administer proposals.
To find out if you qualify, you need to start by contacting a trustee in your area – who will go over your financial situation and all of your options with you, in detail.
In the Toronto area, you are welcome to call us at 416-498-9200 for a free consultation to see if a consumer proposal is in your best interest.