If you are struggling with debt, it’s important to know that there are options. While your debt might seem overwhelming, the reality is there are many different things you can do. One of these options is filing a consumer proposal.
Many people who are facing financial difficulty are curious of the differences between Consumer proposals and bankruptcy in Edmonton. This is understandable. While the two processes are the similar, there are several key differences.
One major similarity is that people who wish to file consumer proposals Edmonton and area must do through a Licensed Insolvency Trustee. These professionals are the only individuals authorized to administer proposals and other insolvency processes (such as bankruptcy) under the federal Bankruptcy and Insolvency Act.
Speaking with a trustee can help you understand the details of the consumer proposal process, explain how to file for a consumer proposal, and give you information on all the debt relief options that are available to you.
How do Consumer Proposals Work in Edmonton?
If you want to know how to file for a consumer proposal, speaking with a Licensed Insolvency Trustee is critical. Trustees are the only people authorized to administer this legal process in Canada.
- When you meet with a Licensed Insolvency Trustee (most offer free consultations), they will give you information on all the options available to you, not just the ones they administer. This means they’ll give you details on consumer proposals and bankruptcy in Edmonton, but also on any other option that could be a possibility.
- If you decide to go ahead with a consumer proposal, the trustee will prepare an offer that they believe is fair to both you and your creditors. The offer will typically see you pay a portion of the debt that you owe, and the remaining debt will be eliminated when the proposal is complete.
- The offer is then be sent to your unsecured creditors who will vote on whether they wish to accept it.
- Only unsecured debts can be included in a consumer proposal. Unsecured debts are debts that are not tied to an asset. Credit card debt, lines of credit, personal loans, tax debt, and other such debts are unsecured debts.
- If the creditors that are owed the majority of the debt vote to accept the proposal, then all are bound by its terms.
- If the proposal is accepted, you will be responsible for making monthly payments as outlined in the proposal. These payments will be made to the trustee who is responsible for distributing them to your creditors.
- When you file a consumer proposal, you receive legal protection from your creditors. This means they cannot call you or have collection agencies contact you. They also cannot take any legal action against you to collect the debts and any action that has already started must stop. The trustee will be responsible for all communication with your creditors.
How do I File a Consumer Proposal in Edmonton?
Wondering how to file for a consumer proposal? The first step is speaking with a Licensed Insolvency Trustee. The process of administering consumer proposals Edmonton and area (and, in fact, across all of Canada) must be done through a trustee. They are the only people authorized to administer this process.
Once you make the decision to file, the trustee will prepare the offer to your creditors and send it to them. If those that are owed the majority of the debt accept, then you are responsible for making the payments as outlined in the proposal. If the creditors do not accept, the trustee can revise the proposal.
Should I File a Consumer Proposal?
When it comes to consumer proposals in Edmonton, Alberta, this process may be a good option for you if you are able to repay some of the debt you owe, but not the full amount. However, each financial situation is unique.
That means the decision to file a consumer proposal is an individual one. There is no “one size fits all” choice that is perfect for everyone. Whether or not you choose to file is always entirely your decision. A trustee will never attempt to influence your decision.
While some people may be concerned about the cost of consumer proposals in Edmonton, it’s important to remember that when you file a consumer proposal, you will only be responsible for paying a portion of the outstanding debt. The remaining debt will be eliminated, which can save you quite a lot of money. Plus, the fees for a consumer proposal are set by the federal government.
Using Consumer Proposals for Credit Card Debt in Edmonton
If you have credit card debt, investigating consumer proposals in Edmonton, Alberta makes sense. Credit card debt can be very difficult to pay down and, since most credit cards have very high interest rates, it can take a long time to repay the debt and you will likely end up paying a lot of money in interest before your debt has been paid off.
Credit card debt can be included in a consumer proposal. In this situation, you will likely only have to pay a portion of what you owe, if your proposal is accepted by your creditors. Remember, only those creditors that are owed the majority of the debt must accept for the proposal to be valid. For example, if you owe $20,000 in debt and those creditors that are owed at least $10,000 choose to accept the proposal, then all are bound by its terms.
When it comes to consumer proposals Edmonton and area, it is important to remember that each financial situation is unique. While filing a proposal makes perfect sense for some people, it isn’t a blanket option that is perfect for everyone. Speaking with a Licensed Insolvency Trustee can help you understand all the options that are available to you so you can make the right choice for your financial situation.
Should I File for Bankruptcy or Get a Consumer Proposal?
There are a lot of similarities between consumer proposals and bankruptcy in Edmonton, but the differences between the two processes are critical.
- Similarities between consumer proposals and bankruptcies include:
- Both are legal processes that must be administered by a Licensed Insolvency Trustee
- You receive legal protection from your creditors when you file. This means they cannot contact you (all communication happens through the trustee) and they are not able to take legal action against you to collect the debt once you file.
- Any legal actions that are already in place must stop once you file.
- Only unsecured debts can be included in bankruptcies and consumer proposals. These are debts that are not backed by an asset.
- Differences between bankruptcies and consumer proposals include:
- With a bankruptcy, you are automatically discharged after a certain time (typically 9 months if it is your first bankruptcy).
- With a consumer proposal, the proposal is complete when you have paid off the amount listed in the proposal. The length of a proposal cannot be more than 60 months (five years) but you are able to pay off the proposal more quickly without penalty if you are able to do so financially.
- With a bankruptcy, you may have to make surplus income payments if you earn more than a level set by the government for your family size. If your salary increases during the bankruptcy, the cost of your bankruptcy may increase.
- Consumer proposal payments do not change once the proposal has been accepted. However, you can pay the proposal more quickly if you’d like.
- Depending on how much you own, you may lose some assets when filing for bankruptcy. Alberta (and all provinces and territories in Canada) considers certain assets exempt (up to a certain value) but you may lose assets that are not exempt. This is different for each province and territory.
- You do not lose assets when you file a consumer proposal.
Consumer Proposal Options and Alternatives in Edmonton
When you meet with a Licensed Insolvency Trustee, they will give you information on all the debt relief options available to you. It is then your decision for how you wish to proceed. Trustees provide information on all options, not just those that they administer. This allows you to fully understand your options before you decide how to proceed.
When it comes to the cost of consumer proposals in Edmonton, it’s important to know that these costs are standardized. Licensed Insolvency Trustees are regulated by the government and so are their fees. This is different from many other financial professionals who may not be regulated or registered at all.
How Much Does a Consumer Proposal Cost in Edmonton, Alberta?
The cost of consumer proposals in Edmonton comes out of the payments that you make to the trustee for distribution to your creditors. In addition, Licensed Insolvency Trustees are regulated by the federal government, which means their fees are regulated as well.
Consumer proposals in Edmonton, Alberta are regulated and governed by the federal Bankruptcy and Insolvency Act and all Licensed Insolvency Trustees in Edmonton and across the country are regulated and supervised by the Office of the Superintendent of Bankruptcy and bound by a strict code of ethics.
How to Pick the Right Consumer Proposal Trustee
When it comes to choosing the right consumer proposal trustee Edmonton and area, it’s important that you work with someone you can trust and someone you feel comfortable with. Licensed Insolvency Trustees must complete specific training in order to be licensed, but different trustees have different levels of experience and, of course, different personalities.
Most trustees offer a free consultation. This gives you an opportunity to learn more about the trustee and to see if they are someone you feel comfortable working with.
How Our Alberta Team Can Help
For more than 35 years, our team has helped people deal with debt and resolve their financial problems. We can help you live debt free.
If you are looking for a consumer proposal trustee Edmonton, know that our Licensed Insolvency Trustees are here to help. Wondering how to file for a consumer proposal? We can give you all the information you need. Want to understand your options? We will give you details on all available debt relief possibilities.
We offer a free consultation where we can review your situation and your finances and provide you with information on all debt relief options. This consultation will give you the information you need to make the right decision for your financial future.
Dealing with debt can be very stressful, but there are ways to improve your financial situation. Our team will help you find them.
We can answer any questions you may have, from how to file for a consumer proposal to the cost of consumer proposals in Edmonton to the differences between consumer proposals and bankruptcy in Edmonton and everything in between.
How to Find Our Office
Looking for a consumer proposal trustee Edmonton and beyond? We are here for you. Please click here to find our closest office. We proudly serve Edmonton, all of Alberta, and Canadians across the country.
If you want to know more about consumer proposals and bankruptcy in Edmonton, or if you just want to understand your options, we can help. When it comes to Consumer proposals in Edmonton, Alberta – as well as other debt relief options – working with a Licensed Insolvency Trustee is a great idea.
Let our team help you understand your options so you can make the right choice for your financial future and start yourself on the path towards a debt-free life. Please contact A. Farber & Partners, Licensed Insolvency Trustee, at our office at 10665 Jasper Avenue, 14th Floor, Edmonton AB T5J 3S9.