Why A Consumer Proposal Is Better Than Bankruptcy

By Karina Frost


People who are barely meeting their needs are common these days. For these people, their income usually go into paying their debts. If they cannot take it anymore, then they will have to file for a petition on personal bankruptcy. This is for them to start over again with their life. Filing for this petition have its own benefits and risks, though.

If the personal bankruptcy is not suitable for a person, then it is only natural to think of other ways to get out of the said debt. Out of the many alternatives available for people nowadays, the one alternative that most opt for is consumer proposal Toronto. This arrangement is negotiated with your creditors through reputable administrator.

This is actually a legally binding arrangement that is put in place between creditors and debtors. When the said arrangement is put in place, then the debtors are immediately protected from debt collectors. Through the said arrangement, it should be easier to make plans for any partial repayment for one's debts.

In filing the said agreement, you can expect any wage garnishments to cease immediately. Accumulating interests will also stop right from the filing date of this agreement. More than that, you can expect the calls from collection agencies to stop right from that date. Remember that this is in accordance with the law.

This arrangement is definitely unlike the bankruptcy. When you choose bankruptcy, you will have to liquidate your assets to be able to pay off all of your debts in one go. However, this agreement will allow you to pay for the debts you have accumulated without having to sell off your house or your car.

There is also no need for you to worry too much about your credit score. Unlike when you declare bankruptcy, the negative impact that is put in place on your credit score will not be generally severe. When you go for this agreement, the credit score will get an R7 rating, as opposed to the R9 rating of bankruptcy. R9 is the lowest rating.

Through this agreement, you should be able to pay off your debt still. When you are allowed that much, then you can surely regain the lost sense of control you got over your own life. It will also be helpful in improving your own self-esteem. You will find a resolution over that feeling of loss you feel.

The creditors will also prefer it if their debtors opt for this agreement instead of filing for bankruptcy immediately. This is because bankruptcy has a higher chance of giving back nothing to them. When in this agreement, the creditors can still expect their debtors to pay even a portion of their debt to them in the future. This is definitely preferable than bankruptcy.

There are various qualifications that you should meet when you opt for the said agreement. It is necessary for you to meet all of the qualifications set in place for the said agreement so that you may avail of it. If you actually fail to qualify, then you will have no other option but to look for other alternatives for your problem.




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