Important Differences Between a Consumer Proposal and Personal Bankruptcy
|Cost||Fixed monthly amount for the term of the proposal. Amount based on what you can reasonably afford.||Can vary month to month depending on your income. The more you earn, the more that you pay.|
|Length||Up to 5 years (60 months)||9 months to 36 months|
|Credit Report Impact||R7
indicates that you are on a debt repayment plan. Reported for 3 years after completion.
the lowest rating possible. Indicates the debt is written off. Reported for 7 to 14 years.
|Duties||Make (agreed upon) monthly proposal payments||Required to perform the following:
1) report income each month
2) if trigger surplus income, make additional payments
3) attend 2 counselling sessions
4) provide tax documents (can lose all refunds)
|Important||Will know up front if creditors will accept proposal offer. 99% of the proposal we file are accepted.||Creditors could oppose discharge at the end. Could result in an increase in cost and/or length of bankruptcy term.|
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