A Consumer Proposal is an arrangement that’s negotiated with your creditors through a Consumer Proposal administrator (who is also a Licensed Insolvency Trustee). It’s an alternative to personal bankruptcy.
A legally binding agreement is put in place to provide you with immediate protection from debt collectors and arrange for a partial repayment of your total unsecured debt owing.
When you file a Consumer Proposal you agree to pay a portion of what you owe, and your creditors agree to forgive the balance.
What happens when you file a consumer proposal?
When you file a consumer proposal:
1) Most wage garnishments cease immediately.
2) Interest stops accumulating from the date you file.
3) Collection companies and creditors can no longer contact you for payment; it’s the law!
4) You are not in jeopardy of losing your house or other assets, as in bankruptcy.
5) You repay only a portion of your debt owing, with a maximum repayment period not exceeding 5 years
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