[{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/rkillen.ca\/what-happens-if-i-default-on-my-consumer-proposal\/#BlogPosting","mainEntityOfPage":"https:\/\/rkillen.ca\/what-happens-if-i-default-on-my-consumer-proposal\/","headline":"What Happens If You Default On A Consumer Proposal?","name":"What Happens If You Default On A Consumer Proposal?","description":"Do you have a consumer proposal that you are struggling to pay and you are wondering “What happens if you default on a consumer proposal”? As a rule, it’s not good to default on any kind of debt. A proposal for an individual \u2013 most commonly called a “consumer proposal”\u00a0\u2013 is one of the two […]","datePublished":"2014-10-09","dateModified":"2024-04-19","author":{"@type":"Person","@id":"https:\/\/rkillen.ca\/author\/admin\/#Person","name":"admin","url":"https:\/\/rkillen.ca\/author\/admin\/","identifier":2,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/9802e0bea345b33afa85a53646482da09b2d7944429d88b59778b5d3e1c3dd14?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/9802e0bea345b33afa85a53646482da09b2d7944429d88b59778b5d3e1c3dd14?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"Richard Killen and Associates","logo":{"@type":"ImageObject","@id":"https:\/\/rkillen.ca\/wp-content\/uploads\/2016\/08\/landscape-logo-12345-for-web.png","url":"https:\/\/rkillen.ca\/wp-content\/uploads\/2016\/08\/landscape-logo-12345-for-web.png","width":600,"height":60}},"image":{"@type":"ImageObject","@id":"https:\/\/rkillen.ca\/wp-content\/uploads\/2015\/03\/What-Happens-if-I-Default-on-My-Consumer-Proposal.png","url":"https:\/\/rkillen.ca\/wp-content\/uploads\/2015\/03\/What-Happens-if-I-Default-on-My-Consumer-Proposal.png","height":1024,"width":742},"url":"https:\/\/rkillen.ca\/what-happens-if-i-default-on-my-consumer-proposal\/","video":{"@context":"http:\/\/schema.org\/","@type":"VideoObject","@id":"https:\/\/www.youtube.com\/watch?v=JCS5VBXwZ18#VideoObject","contentUrl":"https:\/\/www.youtube.com\/watch?v=JCS5VBXwZ18","name":"Consumer Proposals In Mississauga- What You Need To Know","description":"https:\/\/rkillen.ca\/consumer-proposals-in-mississauga-what-you-need-to-know, Sean Killen, President of Richard Killen & Associates Ltd., answers frequently-asked questions on consumer proposals and bankruptcies in Mississauga.\n\nDo you see more consumer proposals or bankruptcies in Mississauga?\n\nOver the history of our office in Mississauga, there are about 60% consumer proposals. People coming into us don\u2019t even want to hear anything about bankruptcy although we are required to go through it with them because it is part of the legalities.\n\nIs there a minimum amount of debt required to be eligible for a consumer proposal or bankruptcy in Ontario?\n\nThere is a minimum under the law. The minimum would be $1,000. The law says you cannot declare yourself insolvent unless you meet the criteria of owing more than $1,000. \n\nWhat\u2019s the average duration of a proposal?\n\nConsumer proposals are designed to be over a 5-year period because that\u2019s the restriction that the law puts. They are not allowed to go beyond five years. However, the person has the freedom and the ability to shorten the term if they want with no interest, no penalties and no restrictions. Although most proposals are designed over five years, they end up paying out right around the four-year mark. Most of the time, after they get over about two and a half years, they start seeing the light at the end of the tunnel and want to pay it off faster. Therefore, they start ramping up their payments a little bit.  Furthermore, they have a chance to get reorganized and start realizing the value in getting things out of the way. \n\nWhat\u2019s the status of the debt during a consumer proposal?\n\nAll the debts still exist. The creditors just agreed to sit back and see whether or not you can satisfy the agreement that was made. Ultimately, the final signatures are in place verifying that you have met the terms of your agreement. The debt still exists and can still blow back on you. Every once in a while, we\u2019ll have a file that does that but very rarely will a file ever get past the halfway mark and then not complete. Most files that don't make it fail in the first year and that\u2019s just because everybody wants to do it but overextends themselves. They don\u2019t properly accommodate to what the reality of their expenses really are. They think they can find money, they can cut back, and they can make this work just so that they can avoid bankruptcy. \n\nIf I go bankrupt, can I get a mortgage?\n\nGetting a mortgage is still difficult because your debts still exist. Getting a mortgage renewal is not a problem. We always advise you to look for automatic renewal. You are already in the mortgage and you are already making payments. As long as you have never missed any payments, they're just going to renew you, anyway.\n\nIf I Go Bankrupt or do a consumer proposal, can I get a car loan?\n\nIt\u2019s easier to get a car loan while you\u2019re in a proposal as opposed to bankruptcy. However, most lenders don\u2019t really care whether you're in a bankruptcy or a proposal. They\u2019re just happy that you\u2019re not dealing with outstanding debts and have creditors looming over you. However, you will always have to pay for it with higher interest rates to make sure they make enough money to cover their risks. They\u2019re happy to lend it to you. Their money is in the car and not in you, necessarily. In general consumer proposals in Mississauga are significantly more popular than bankruptcies. \n\nIf you are having debt problems and considering bankruptcy or a consumer proposal, I invite you to talk to one of our licensed insolvency trustees. This will ensure you have all the information to make an educated decision on your debt relief solution.\n\nWe can meet with you during business hours or book after hours appointments if that is more convenient for you.\n\nContact us for a fresh start (905) 822-1151\nThis may be the most stress relieving call you will ever make!\nFollow us on Social Media: \nhttps:\/\/www.instagram.com\/killen_trustee\/\nhttps:\/\/twitter.com\/Killen_Trustee\nhttps:\/\/www.facebook.com\/rkillenassociates\nhttps:\/\/www.linkedin.com\/company\/richard-killen-&-associates\/\nhttps:\/\/www.linkedin.com\/in\/richard-killen-020aaaba\/\n\nRichard Killen and Associates have 10 locations across the Greater Toronto Area.\nOur Mississauga offices are at \nRichard Killen & Associates Ltd\nLicensed Insolvency Trustee and\nLicensed Consumer Proposal Administrator\n2155 Leanne Blvd #203, Mississauga, ON L5K 2K8, Canada\nhttps:\/\/rkillen.ca\/erin-mills-oakville-mississauga-bankruptcy-trustee\/\n\nRichard Killen & Associates Ltd\n130 Dundas St E #304,\nMississauga, ON L5A 3V8\nTel: (905) 822-1151\nhttps:\/\/rkillen.ca\/bankruptcy-trustee-in-cooksville-port-credit-mississauga\/","thumbnailUrl":["https:\/\/i.ytimg.com\/vi\/JCS5VBXwZ18\/default.jpg","https:\/\/i.ytimg.com\/vi\/JCS5VBXwZ18\/mqdefault.jpg","https:\/\/i.ytimg.com\/vi\/JCS5VBXwZ18\/hqdefault.jpg"],"uploadDate":"2019-04-21T19:42:39+00:00","duration":"PT4M46S","embedUrl":"https:\/\/www.youtube.com\/embed\/JCS5VBXwZ18","publisher":{"@type":"Organization","@id":"https:\/\/www.youtube.com\/channel\/UCVqfGDwXy-OK5RHKZGkaMUw#Organization","url":"https:\/\/www.youtube.com\/channel\/UCVqfGDwXy-OK5RHKZGkaMUw","name":"Richard Killen & Associates Ltd","description":"Since 1992 we at Richard Killen & Associates have helped thousands of people resolve their financial problems. With over 22 years experience in this industry, our president, Richard Killen, and the rest of our team understand the difficulties that honest people can sometimes find themselves in. This expertise makes it possible to provide you with a service that effectively deals with the issues.\n\nThe strength of our company is exemplified by the manner in which we treat our customers. We understand the intense pressure people are under. You will feel better after having spoken with our staff and your sense of dignity will be restored. The relief most people feel is tangible.","logo":{"url":"https:\/\/yt3.ggpht.com\/ytc\/AIdro_nK1yzM56nIFCGmWO7scxw1pLTW2Z8LVLH_kg8kdbbfw5M=s800-c-k-c0x00ffffff-no-rj","width":800,"height":800,"@type":"ImageObject","@id":"https:\/\/www.youtube.com\/watch?v=JCS5VBXwZ18#VideoObject_publisher_logo_ImageObject"}},"potentialAction":{"@type":"SeekToAction","@id":"https:\/\/www.youtube.com\/watch?v=JCS5VBXwZ18#VideoObject_potentialAction","target":"https:\/\/www.youtube.com\/watch?v=JCS5VBXwZ18&t={seek_to_second_number}","startOffset-input":"required name=seek_to_second_number"},"interactionStatistic":[[{"@type":"InteractionCounter","@id":"https:\/\/www.youtube.com\/watch?v=JCS5VBXwZ18#VideoObject_interactionStatistic_WatchAction","interactionType":{"@type":"WatchAction"},"userInteractionCount":71}]]},"about":["Consumer Proposals","Debt"],"wordCount":498,"articleBody":"Do you have a consumer proposal that you are struggling to pay and you are wondering “What happens if you default on a consumer proposal”? As a rule, it’s not good to default on any kind of debt.A proposal for an individual \u2013 most commonly called a “consumer proposal”\u00a0\u2013 is one of the two ways of addressing a severe debt issue under the Canadian Bankruptcy and Insolvency Act. The other, of course, is bankruptcy.Using the services of a Licensed Insolvency Trustee, like Richard Killen & Associates, a consumer proposal is a deal that you strike with your creditors to pay back part or all of what you owe, according to your means, either through a lump-sum payment or, more likely, a series of monthly payments. As long as you make the required payments, your creditors can take no action against you.Once all the payments are made, you are freed from the spectre of your debt.However, what happens if you miss some of the payments agreed upon in the proposal?Since the proposal is a legally binding agreement, this would be a serious situation. If you fail to meet the terms of your proposal, especially by missing three months of payments, the consumer proposal is annulled automatically. (You can miss up to two payments without triggering the consumer proposal annulment. The missing payments will be tacked to the end of your term.)And what happens after a consumer proposal is annulled? Well, your creditors are free to once again start collections and\/or take legal proceedings against you. And you may be faced with bankruptcy.If you start falling behind in your proposal payments and you know that your shifting financial situation is going to make it hard to make them up, then you need to see your trustee and review your situation. You might be able to amend the proposal and solve the problem that way. You might have other options, but you’ll need to see the trustee. He or she can tell you what you need to know.But fair warning: if you amend your consumer proposal, it will mean that your original one no longer applies. Your amended proposal will have to go through the creditor approval process again, and if your creditors refuse the amended version, you cannot just go back to the original terms.Consumer Proposals In Mississauga- What You Need To KnowWatch this video on YouTubeThis is why we at Richard Killen & Associates believe it is critical that we sit down with you at the beginning of the process and work out reasonable terms for a consumer proposal. That is the only way you can have peace of mind knowing that you are getting your financial life back on track \u2013 one payment at a time. If you are at the point where you are asking what happens if you default on a consumer proposal, it’s time to talk to a licensed trustee before you default."},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"What Happens If You Default On A Consumer Proposal?","item":"https:\/\/rkillen.ca\/what-happens-if-i-default-on-my-consumer-proposal\/#breadcrumbitem"}]}]