Consumer Proposal - Good??

iVillage Member
Registered: 03-27-2008
Consumer Proposal - Good??
5
Mon, 05-26-2008 - 1:17am

Hello:


Well, I am at the bottom of the tracks.


At the point of handing in a consumer proposal.

iVillage Member
Registered: 03-17-2003
Mon, 05-26-2008 - 1:19pm
I'm not knowledgeable about your Canadian laws but there is enough similarity with Canadian and US debt management concepts to offer some feedback.

iVillage Member
Registered: 03-17-2008
Mon, 05-26-2008 - 2:38pm

Hi there i read your problems sorry about the luck you are having, but there is light at the end of the tunnel.


I myself have done a credit proposal here in canada this is my third year in it and two more to go it was the best thing that i done, you are protected from any wage garnishes creditors calling you or any judgments that are placed against you if you have any unsecured loans nobody can take anything away from you all you do is make one small payment a month that you can afford, but be beware never miss a payment or be late it goes against you and you are only aloud to miss three payments through the whole term of your credit proposal or you will be back to square one with your creditors, but its such a relief on your back you can acutally answer your phone and check your mail with no worries. and yes it does affect your credit but sometimes its the only way out, if you have anymore questions feel free to post and i will help you out the best i can.


good luck and keep us posted on how you are doing


blender


iVillage Member
Registered: 07-06-2003
Mon, 05-26-2008 - 6:46pm

Hi there,

I too have been pondering going the route of a consumer proposal. I'll post more on my situation later to get feedback from everyone.

In your situation, where you are facing the real possibility of future wage garnishment, debt collectors and the like, I think that this may be the best solution. It is better than going for bankruptcy altogether if you have the income to make a payment every month but are financially way over your head and it stops the interest altogether.
Now with a consumer proposal, it will figure as either a R7 or an R9 rating on your credit report until you have been confirmed as paid up by the trustee...they provide you a certificate upon successful completion of the approved proposal. The notice will fall off your credit report entirely 3 years afterwards.
So for ex. your proposal is for 3 years, then the note on your credit report will be removed after 6 years. In the event your credit history is already negatively affected due to lates and such, the rating is of lesser consequence. The point is to become solvent, come face to face with the reasons that brought you to this point, address it and move forward by learning about personal finance and implementing a sound plan to live by; living below your means.

As a previous poster mentioned, you can only defer a maximum of three payments which will be tacked on to the end of the proposal term. If you miss more than three months, the proposal becomes null and void and you are no longer protected by the courts. The interest that you will save will now be due retroactively to the beginning of the proposal...and it just gets very ugly from that point.

You mentioned that you have a loan co-signed by your father. You may want to speak with a counselor at the trustee to see how you should deal with that in order to not adversely affect your father's credit report. Normally they don't permit you to withhold a debt outside of those submitted in a proposal, and the other creditors may potentially bring it up at a creditors' meeting if they notice it on your credit report and that that particular company is not on the list of creditors within the proposal.

I work as a Credit and Finance Analyst, so I am pretty familiar with the Canadian rules and system.

Whatever route you choose to take, do what is best for you - take care of your priorities (food/shelter/transportation). You did rack up the debt, but a consumer proposal is a respectable way of trying to honour your obligations under duress.

Best wishes to you!

Kassandra


"It is said that life has its peaks and valleys.

Kassandra

"It is said that life has its peaks and valleys.  The challenge is to accept them equally and experience them

iVillage Member
Registered: 03-27-2008
Thu, 05-29-2008 - 2:19pm

Hello:

Thank you to everyone who has replied to my posting. All your thoughts and suggestions help.

Well, I did the right thing. I told my boyfriend of 3 years about the situation. You see, the rest of the story I shared did not reflect being served at work. Yes, with a statement of claim to begin a judgement process. So stressful.

So we will now be seeing a Lawyer. OH MY.

But regarding the consumer proposal, I did not go ahead. I filed an application but was sick over the decision. I was nauseated, had headaches and could not sleep. For me, my intuition was telling me not to sign. I was hiding all this from my boyfriend. Finally, I couldn't pretend anymore.

Eventaully, he will know that my finances are in terrible shape. He has suggested the credit counselling would be the better idea.

My only word of advice: do not hide your financial issues from your partner/boyfriend it is like living in a dark cave, wanting to get out buy you can't.

Please send your positive thoughts as I endure this highway of going through this legal process, etc. I pray things turn out better.

I will be going to the Credit Counselling Society.

Thank you.
Will keep everyone update.








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iVillage Member
Registered: 07-06-2003
Thu, 05-29-2008 - 5:19pm

I am glad you came to a decision that felt right for you and your situation. I wish you only the best and keep us posted.

Take care.

Kassandra


"It is said that life has its peaks and valleys.

Kassandra

"It is said that life has its peaks and valleys.  The challenge is to accept them equally and experience them