The Consumer Proposal

Understanding Consumer Proposals

You have a great job, you have money coming in, but you’re having a hard time paying all of your debt back and paying it back on time. Is bankruptcy your only option?

The great news is there are other options. You should meet with a professional to know what options are out there to best deal with your creditors. Sometimes you need more than counselling to help restore your financial health.

Consumer Proposal

A Consumer Proposal is an option for those in debt to work with a Licenced Insolvency Trustee (LIT ) to negotiate a better personalized payment with your lenders. You should ensure you are working with a LIT as they are professionally certified, follow a professional code of ethics, and are properly trained.

The LIT works with you to create a proposal to creditors that is fair and reasonable to all parties. They’ll use your budget to tailor a plan and create payment arrangements that work for you, and most times have that broken down into equal payments over a period of time.

It’s Not Bankruptcy

Consumer Proposals have been increasing in popularity for several years.More people are choosing to settle debt using a Consumer Proposal instead of filing for bankruptcy.

Consumer Proposals are typically set up as payments over a period of time and can greatly reduce the overall amount of debt you must pay. The flexibility of a Consumer Proposal means that there is a range of terms that creditors may accept, which may benefit you as a consumer more than a bankruptcy would.

Sometimes, personal bankruptcy may be the best option for debt management. However, it is always best to meet and discuss your specific situation and needs in person before making a final decision.

Additional Benefits

If you have student loans or income tax as part of your debt load, your LIT will work with you on the best ways to manage this debt.

A proposal is accepted by all creditors if the majority of unsecured creditors accept it. And once accepted, your creditors are bound by it as long as you continue to make your payments.

A consumer proposal is a great option, but not the only option. Speaking to professionals about your situation is the best way to discover which path to financial wellness is appropriate for you. With free consultations, Rita Anderson & Associates is always available to help you make those first steps.

Signs You Could Need Financial Counselling

One of the most difficult parts of being in debt is you never really know when you should seek help. Most debt is acquired over a long period of time, meaning the signs that things have gotten out of control don’t show up overnight.

For many, solutions can be found in counselling from a professional; but how can you tell it is time to seek help?

Every Cent of Your Earnings is Spoken For
Does this sound familiar? You’re living paycheck to paycheck. You’re unable to put anything substantial towards paying off your loans and credit cards. All you can contribute are minimum payments, or less. Every new unexpected purchase adds to the debt pile. That debt pile is beginning to feel like quick sand.

It’s important to track all your money coming into your bank account. Not knowing how much money you make is a sign of financial difficulty.Having all of your income accounted for before it even arrives in your bank account – especially if you have more going out than coming in – is a surefire sign that you need to seek counselling. Minimum payments on your loans is bad. Less than minimum payments is the danger zone.

Creditors are Contacting You
It starts with letters in the mail and then the phone calls start.Phone calls start sometimes 15 days past due.If creditors are calling you – this is a red flag you are in financial difficulty. Every phone call gives you anxiety to the point where you stop answering. When the heat from collections agencies is on, the level of stress you can experience goes through the roof.

If creditors are calling, you need to seek a professional for guidance on making a plan to make things better, if not then things will only get worse.

You’re Looking for More Money That Isn’t Yours
If you’re seeking a cash advance from a money lender to help you pay for everyday items, or even worse, to pay off your debt, then you’re in serious trouble. Don’t get sucked in by the friendly marketing and “great deals” on money loans. When you peel back the layers on these companies, all you get is a high interest lender that reels you into another debt trap.

Debt cannot be cured by more debt. If you’re visiting these stores and seeking cash advances, it’s time to seek a professional about credit counselling.

So What Will a Professional Help me With?
A licensed and trained professional will help guide you on ways to rebuild your credit history. If it isn’t too late, financial counselling will help you avoid bankruptcy. Should bankruptcy be necessary, trusted professionals are there to assist with the process.

But financial counselling doesn’t only relieve debt. You need to consider the other areas of your life that are going to improve. You’ll also be relieved of stress which can lead to better sleep, stronger relationships, and the ability to focus positive energy into other areas of your life.

Overall, the main goal of a counselor is to resolve issues with your debt and help you identify other issues that are contributing to your financial difficulty.If you’re following the plan created with your professional, you will be on the road to financial recovery.

Is it time you reached out for financial help?