If you're in need of help with credit card debt and are tired of being forced to file for bankruptcy, then you should look into a Consumer Proposal. This is a debt relief solution that can eliminate up to 60% of your unsecured debt. However, like all legal solutions there are always a risk involved and a certain amount of expense as well. This article will discuss some of the pros and cons associated with this popular plan.
First of all, a consumer proposal is a legally binding loan agreement, signed by a licensed insolvency trustee, to settle your debts for a percentage of actually owed instead of full repayment. By making only one payment each month to the insolvency trustee, you will pay off your debts much faster than if you continued to make payments on your own. This is very important for anyone who wants to get rid of debt quickly. Also, because creditors do not have to worry about going through the court system, they will often settle the case for far less than what they may be owed.
Secondly, a consumer proposal allows you to negotiate directly with your lenders. By creating a document that lists all of your income and expenses you can quickly determine how much money you can realistically save each month. You can show these figures to your creditors and ask for a reduction in interest or fees. In many cases you can get a significant reduction in the amount of money you have to pay each month.
Thirdly, a consumer proposal can put you in a better position than your creditors when it comes to negotiating new terms for your account. When you create and submit a proposal to the creditors, you are not only telling them what you can afford, but also what kind of deal you want. This gives you an edge when it comes to getting new terms and conditions agreed upon with your lenders. For this reason it is highly recommended that anyone who is considering using a consumer proposal should undergo some form of negotiation training.
In addition, you can use a consumer proposal to eliminate a wide range of debts. These include personal loans, credit card debt, auto loans, and home loans. In fact, if you can qualify for an import tax refund you can use a consumer proposal to eliminate a portion of your tax obligations. A large number of people also use a consumer proposal to reduce premiums on their health care plans. If you are able to obtain lower health insurance premiums than you currently pay, you can save hundreds of dollars every year. In addition, some consumers have used a proposal to reduce the interest on their student loans. Please view here for more great tips.
The above reasons explain why a consumer proposal can be a great financial tool when filing for bankruptcy. Bankruptcy filings are difficult tasks that take a long time to resolve. By using a professional debt settlement service you can get out of debt quickly and without having to spend years working to resolve your debts. In addition, if you use a consumer proposal you can get rid of a large number of bills in a timely manner, saving you even more money.
Look here for added details: https://en.wikipedia.org/wiki/Bankruptcy