What is the Voting Period in a Consumer Proposal?



If you find that you are experiencing financial difficulty and you are struggling to pay your debts in a reasonable period of time but can afford to pay a consumer proposal is an option. In a proposal you make an offer to repay a portion of your debts and your creditors vote to accept or reject that offer. First you will meet with a licensed insolvency trustee to sign your documents. The trustee will file your…


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What Happens If My Creditors Reject My Consumer Proposal?



Consumer proposals are rarely rejected, however, if your creditors do reject your consumer proposal, all hope is not lost. When you file a consumer proposal, your creditors have 45 days to vote on whether they will accept the terms that you offered (this includes terms such as the payment amount and the length of the proposal) or reject those terms. Consumer proposals are accepted or rejected based on votes by your creditors. The voting system operates under…


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Consumer Proposal Vs. Division I Proposal To Creditors



What is a consumer proposal? A proposal to creditors is a deal you negotiate with the people you owe money to in order to repay a portion (or perhaps all) of what you owe.  If you like legal terms, a proposal is an “arrangement” to “settle” your debts for less than their full amount. You might be asking yourself, “Why would anyone accept a deal for me to repay less than what I owe?”  That’s…


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Will There Be a Meeting of Creditors During My Proposal?



When talking with clients, I often get asked, “Do I have to meet with my creditors?”; coupled with a look of stress or fear. Let me explain the basics and then provide you with some practical, real life scenarios. The Basics The Bankruptcy and Insolvency Act tells us that the Administrator of the proposal (that’s your trustee) is to call a meeting of creditors if: directed to do so by the Official Receiver (the government)…


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Does the Government Have to Approve My Consumer Proposal?



Consumer Proposals are the only debt settlement programs regulated by the federal government. You may know that your creditors will vote on your consumer proposal and if more than 50% vote yes your proposal terms will be accepted. But what role, if any, does the government play in approving or processing consumer proposals? Government Oversite through the OSB Any bankruptcy or consumer proposal has to be filed with the Office of the Superintendent of Bankruptcy (OSB) for it…


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How the Voting Process Works on a Consumer Proposal



If you’re struggling to repay debts, you can ask creditors to reduce the amount you have to repay on your debt by offering a Consumer Proposal.  A consumer proposal is legally binding between you and your creditors if they accept the offer made. The creditors would generally consider accepting this if what you’re offering to them provides a greater benefit to them than they’d receive if you were to file a bankruptcy instead. As much…


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Consumer Proposals: What is the Acceptance Rate?



You are filing a consumer proposal to deal with your debts, but obviously if your creditors don’t agree to your proposal, there’s not  much point in filing a proposal. For a consumer proposal to be accepted, a majority of the dollar value of your creditors must accept the proposal.  So, if you have $50,000 in unsecured debts, you need $25,001 of those dollars to vote to accept the proposal.  If more than half of the…


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Why Do Consumer Proposals Have Different Payments When the Debts are the Same?



A consumer proposal is a great way to eliminate your debts, but how much will it cost? The amount you will be required to pay in a consumer proposal is based on many factors.  Here is an example to illustrate how payments are determined. I recently met with Evan (not his real name).  He had $60,000 in total debt, so he offered a proposal of $400 per month for 50 months, for total payments of…


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Are Consumer Proposals Often Rejected?



What are the chances your consumer proposal will be accepted or are consumer proposals often rejected?   If you are considering filing a consumer proposal you are going to want to know what the chances are of your proposal being accepted by your creditors. Once you file your proposal your creditors have an opportunity to vote on whether to accept or reject your proposal, we refer to this as the “voting period”.  Here are some of…


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4 Factors that Greatly Increase the Likelihood of a Successful Consumer Proposal



A consumer proposal is a court sanctioned way to negotiate a settlement with your creditors and one of the best ways to avoid filing bankruptcy in Canada . As I am a licensed trustee in bankruptcy and consumer proposal administrator with Goth & Company Inc., I see a large number of consumer proposals and recognize the importance of crafting a proposal properly. Unfortunately not all proposals are created equal, nor are all proposal administrators. There…


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