Bankruptcy discharged in 2004 and Consumer Proposal in Jan. 2015: Worthwhile to try to apply for a mortgage now?
Can I get a line of credit with a consumer proposal?
One of the most frequently asked questions we receive is, “Will my credit be affected, and will I still be able to use a credit card after I file a consumer proposal?” The short answer is yes, a consumer proposal will impact your credit rating and yes, you will still be able to acquire a credit card after you file.
What happens when you pay off a consumer proposal?
What happens when you pay off your proposal? Once your consumer proposal repayment plan gets completed, you receive a Certificate of Full Performance. This certificate shows you have honoured your commitments and completed your consumer proposal. This is the last formal step in your consumer proposal.
How do I get out of a consumer proposal?
How to Pay Off Your Consumer Proposal Early Without a Loan
- Increase your payment frequency. Instead of making monthly payments, make weekly or bi-weekly payments. …
- Increase your payment amount. If you can afford it, increase the amount you pay each period. …
- Lump sum payment.
What debts can be included in a consumer proposal?
In a consumer proposal, you can include the following debts:
- Credit cards.
- Lines of credit.
- Personal loans.
- Payday loans.
- Certain student loans.
- Income tax debts.
Is it possible to get a mortgage after consumer proposal?
You absolutely can, and often it is the fastest way to pay off a large debt like a consumer proposal. You may wish to take on a larger mortgage to cover both your property amount and the consumer proposal, provided there is sufficient equity in your property to cover the additional loan needed.
Can you get a mortgage while in a consumer proposal?
Can you get a mortgage during a consumer proposal? A Consumer Proposal can’t prevent you from obtaining a new mortgage, even if your current one is not yet paid off. You should still be able to give the bank all required documentation including pay stubs and income tax returns.
How long does a consumer proposal stay on your record?
3 years
A consumer proposal will be removed from your Equifax credit report 3 years after you’ve paid off all the debts according to the proposal, or 6 years from the date it was filed, whichever comes first. Secured loans remain on your Equifax credit report for 6 years from the date filed.
How long does it take to rebuild credit after consumer proposal?
Credit History and Score after a Consumer Proposal
A Consumer Proposal will be reflected on your credit history report for 3 years after the date you finish your Consumer Proposal, or 6 years from the date your Consumer Proposal started (whichever is soonest).
Is consumer proposal a good idea?
A consumer proposal is one of the best and safest debt consolidation options available. Creditors will generally accept your consumer proposal if you offer more than they would expect to receive in a bankruptcy.
What are the pros and cons of a consumer proposal?
Consumer proposal pros and cons
| Pros | Cons |
|---|---|
| You will get out of the unsecured debt you owe in 60 payments or less. | The agreement is legally binding, so if you break it you will not receive a refund on the fees that you paid. |
Can you do a consumer proposal twice?
The short answer is no, there is no limit to the number of times you can file a consumer proposal. Unlike a bankruptcy. If you file a second bankruptcy, your discharge takes longer and may cost more and if you file a third bankruptcy you would need to go to court to apply for a discharge.
Is a consumer proposal public record?
Consumer proposal and bankruptcy records remain public
When you file a proposal or declare bankruptcy, your name becomes part of public bankruptcy and insolvency records. These records are accessible to anyone who makes a request for the information.
Why are consumer proposals rejected?
The court may reject the proposal if it finds that the terms of the proposal are not reasonable or fair to the debtor or the creditors. However, if no request is made within 15 days, the proposal is considered approved.
Will a consumer proposal affect my mortgage renewal?
If you’re already a homeowner, and just you or your spouse files a consumer proposal, or you file one jointly, your mortgage will not be affected as long as you are making its payments.
How much do you pay back in a consumer proposal?
In general, having debt cut down so that you are repaying as little as 20% to 50% of the total balance is a reasonable guideline. To be successful your Consumer Proposal should provide for a ‘meaningful’ portion of your debts being repaid.
Does consumer proposal affect credit rating?
A consumer proposal will affect your credit rating, but less drastically than a Bankruptcy. While both options make it less likely that you will be able to obtain credit a Consumer Proposal will only stay on your record for three years after your last payment.
Does CRA keep your refund in the year that you do a consumer proposal?
You remain eligible to receive your tax refund for the income earned during the year of the proposal after the proposal filing date. To avoid processing delays on the CRA end, it is recommended that for the year of the proposal filing you file two tax returns (Pre and Post).
What is the maximum debt level over which one Cannot make a consumer proposal?
$250,000
Debt Required to File a Consumer Proposal
The maximum that you can owe as a single person and still qualify for a consumer proposal is $250,000. Married couples who file their income taxes jointly, however, can owe up to $500,000.
How long can debt collectors try to collect in Canada?
How Long Can A Debt Collector Pursue An Old Debt In Canada? While debt collectors can technically pursue an old debt in Canada for as long as they’d like, there are laws in place that restrict when they can take someone to court or file legal action against a debtor. In Canada, this period is six years.
How do I know if I qualify for a consumer proposal?
You are eligible to file a Consumer Proposal if your debts, excluding claims secured by your principal residence (mortgages, property taxes. etc) do not exceed $250,000. If your debts exceed $250,000, you may still a proposal but it is called a Division 1 proposal.
Will a consumer proposal affect my employment?
In most cases, your ability to obtain employment should not be impacted by an insolvency filing, whether that’s a consumer proposal or bankruptcy.
Can I lease a car while in a consumer proposal?
It is not impossible to lease a car while you are in a consumer proposal, but it is more difficult. In our practice we recommend that you investigate a replacement car before filing the consumer proposal, so you know your options.
Will I lose my car in a consumer proposal?
If your car and mortgage payments are in good standing, however, they will not be affected by a consumer proposal. All your possessions and belongings, including your car and home, are protected from your creditors when you file a consumer proposal.
What documents do you need for a consumer proposal?
A consumer proposal is a legal settlement negotiated between yourself and your creditors to avoid bankruptcy.
A formal consumer proposal requires four documents that the administrator will file on your behalf:
- A Statement of Affairs.
- A Statement of Income and Expense.
- An Assessment Certificate.
- A Consumer Proposal.