It’s easy to fall into arrears and get in debt, whether it’s because of an unexpected vehicle repair or because you’ve recently lost a job and you don’t have a salary to cover your outgoings. Whatever the reason, it’s not an easy step to take to sort out your finances, but it’s a step that needs to be considered otherwise it could make it impossible for you to secure finances in the near future. If you’ve fallen behind on your bills and you now have creditors chasing you for money but you don’t have enough to spare every month, before you file for bankruptcy, consider filing for a consumer proposal for these reasons instead.
Cease the Interest on All Debts
One of the biggest benefits of a consumer proposal is that when your creditors agree to one, your interest will be frozen so you can start getting on top of your finances. A lot of consumers don’t like the idea of a consumer proposal because the proposal will appear on their credit file. However, there are more benefits to filing for one than there are for filing for bankruptcy.
Make Your Repayments Affordable
A consumer proposal isn’t a miracle worker that’s going to get you out of a massive hole, it’s just a helping hand to make the hole easier to climb out of. One of the major benefits it provides is that it will lower all your debt repayments into one affordable monthly cost that your salary can cope with.
Stop Creditors from Harassing You
Once you’ve told your creditors that you’re filing for a consumer proposal and they’ve agreed to it, they’ll not be able to contact you for payments until the debt is cleared. You’ll obviously need to stick to the repayments for this change to take effect, but a consumer proposal will help to relieve a lot of stress.
Your Valuables Will Remain Protected
If you have a car sitting on the drive or a nice sized television in the family room, with a consumer proposal filed, your belongings can’t be touched. This means you get to keep everything you own whilst the debt is being cleared.
You’ll Get to Keep Your Job
Another benefit of filing a consumer proposal is that your employer can’t fire you, so it would be the wise option if you’re getting a good salary. If your employer lets you go on finding out about your consumer proposal, they would be in breach of federal law and they’ll quickly find a lawsuit on their hands.
A consumer proposal isn’t for everyone because there are one or two negatives in the sense a consumer proposal will still appear on your credit file, and you’ll have to stick to making the repayments otherwise you’ll be in a worse position. However, the pros certainly outweigh the bankruptcy route which is why it should always be strongly considered if you find yourself in a bit of a tough situation with your financial affairs.