Dwindling funds usually translates to the accumulation of unmanageable debt, as debt payments and various financial obligations can no longer be met. If you are one of these individuals who needs aid towards the resolution of your financial problems or specifically, the reduction of your overall debt, you may wish to consider a consumer proposal in Red Deer. This option, which allows debt settlement by payment of amounts less than what are actually owed, may be just what you need to get your finances back on track. Here is some consumer debt proposal information for Canadians considering this means of debt relief:
Consumer Proposal – a Definition
A consumer proposal is basically an agreement between you and your creditors. With this agreement, you can settle your debts with the creditors involved in the proposal by paying a portion of each debt within a predetermined time frame. This agreement is a legally binding one that requires you work with a licensed bankruptcy trustee. It also needs the approval of a majority of the creditors involved prior to taking effect.
The Benefits of a Consumer Proposal
In addition to the sustainable debt relief it provides, a consumer proposal also has many other advantages. Among them are:
- A halt to phone calls and letters from creditors who demand payment, as well as a stop to impending wage garnishments and other collection activity.
- The retention of your home and other valuable assets that would otherwise be taken by the courts for liquidation and debt payment in bankruptcy.
- A stop to the accumulation of interest and other various peripheral fees on your unpaid debts.
Consumer Proposal Requirements
To obtain approval for your consumer proposal and attain its debt relief benefits, you have to meet the following requirements:
- You should have debt ranging from a minimum of $5,000 to a maximum of $250,000 – home mortgage excluded.
- You must be employed, and earn enough income to make the agreed upon payments every month.
Keep in mind that this legal agreement does not cover debts such as child support, alimony, other court mandated payments or your secured debt such as mortgage and car loan payments.
There are numerous legal options available to the individual who wishes to regain financial stability. If your money problems can no longer be resolved by means such as reducing your spending and filing for bankruptcy is something you’d like to avoid, you may want to consider a consumer proposal. Prior to making your decision to apply for one, talk to your trustee about consumer debt proposal information for Canadians and see if you qualify.