consumer proposal after bankruptcy

August 3rd, 2010 by Questions

I have been discharged from my bankruptcy for 5 years now. Unfortunately, my husband and I have separated and I`ve been using my credit cards to fill in the financial gaps. I know, mistake. I am presently looking for a full time job as my last job has gone to part time hours. I am about $35,000 in credit card debt with no more room to breathe. The interest and payments are way beyond my ability to pay. Is it possible for me to look at the consumer proposal option? I understand that a second bankruptcy would bring 14 years on my credit record – I simply could not do that. Is it the same thing with a consumer proposal staying on my credit report that long? Thank you very much. Tanya

Posted from: Ontario


One Response to “consumer proposal after bankruptcy”

, A licensed trustee said:

You’ve hit on a couple of points… First, when you file a consumer proposal it is supposed to be reported as an R7 on your credit report (bankruptcy is an R9). Further, your debts remain at the R7 while you are in the proposal and then there is a warning on your file for 3 years after you’ve completed your payments. So, that sounds better than the 14 years for a second bankruptcy.

As to whether or not you may file a consumer proposal – you should expect to have to offer your crditors somewhere around 1/3 of your debt at a minimum. So if you owe $35,000 you should be thinking of offering your creditors at least $12,000 over a maximum of 5 years (that’s $200/month).

Whatever trustee you speak to will be able to explain all of this in greater detail.

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