mortgage refinance after consumer proposal

I am thinking of doing a CP. I am scared that after doing this, I will not be able to renew my mortage in 4 years. I only bought my house 1 year ago, so will not have that much equity in it. Will a bank still refinance me after a CP, if I stay with the same lender? Even if I have made all my mortage on time?

Posted from: Ontario

One Response to “mortgage refinance after consumer proposal”

Barton Goth – Goth & Company Inc. -Trustee in Bankruptcy said...

Normally speaking as long as you have a good history on your mortgage, have kept up on your payments, and there is some equity in the property, a mortgage renewal with the same institution is pretty straight forward.

Although, in terms of the impact of a consumer proposal on this process, I would argue that if you are in a position where you are considering a consumer proposal then likely you have a fairly significant amount of consumer debt. While it is impossible to know for sure, but I would suggest that this high level of consumer debt will make it just as difficult if to obtain any financing, if not more so.

One of the major considerations lenders look at is cash flow and ability to make payments. After the consumer proposal is filed both of these criteria will be significantly improved.