Are You Currently the Proper Choice for a Client Propsal
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Settling debts through a consumer proposal is a debt management strategy whereby borrowers pay only a portion of what they owe. It is also a form of debt relief in that the borrower pays back less than the amount to be repaid originally. This type of debt elimination strategy is intended for persons who have unsecured debts. You are the right candidate for a consumer proposal if you have savings or other sources of income to repay all or a portion of your debt. Your total debt should be between $5,000 and $250,000. Debtors who want to avoid bankruptcy resort to this debt reduction strategy. Financial institutions will be willing to accept a consumer proposal if what you can offer them is more than what they would get if you were to file bankruptcy. For example, creditors will consider your proposal if you offer $35,000 while the equity in your house is only $25,000. Financial institutions will accept your proposal as they benefit more than if you go bankrupt. If what you offer them is less than the equity in your home, financial institutions would rather see you going bankrupt. You are an ideal candidate if you have unsecured debts such as credit cards, lines of credit, income taxes, personal loans, and other debts that are not secured with collateral. Secured debt is offered against collateral, and this category includes car loans and leases, mortgages, and financial contracts. You cannot include secured debt in a consumer proposal. One exception is if the amount borrowed is more than the value of the collateral. The right candidates for this debt reduction strategy are borrowers who want to keep their assets.
Wage garnishment and legal action against you are not allowed. You do not have to pay any fees when filing a consumer proposal. The proceeds from the proposal are used to pay to the proposal administrator. If you need to know about the credit card visit this [http:/www.greatbusinessmen.net/the-best-way-to-apply-for-credit-card.html guide/].This means that your creditors will pay the cost of filing. Borrowers who have a joint debt with their spouse are allowed to file a joint consumer proposal for all of their non-mortgage debts. The amount of debt should not exceed $500,000. Applying for a debt consolidation loan is one alternative to a consumer proposal. At the same time, even if you have a well-paid job, having accumulated a high debt load may result in your application being rejected.
It is reasonable to ask who is not a good candidate for a consumer proposal? Debtors who cannot make payments may consider other debt reduction strategies, even bankruptcy. Just keep in mind that depending on your income, surplus income penalties may apply. You may also lose valuable assets such as your car, and the effect of bankruptcy on your credit rating will be more severe than if you were to file a consumer proposal.
