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CP percentage

I’ve read different accounts of the minimum amount that a consumer proposal can be negotiated for? Anywhere from 15 to 30 percent of total unsecured debt. When filing a proposal, what percentage do you typically aim for? What do you base this number on?

Posted from: Ontario

One Response to “CP percentage”

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

The problem with quoting a percentage is that every consumer proposal is different. I have proposals that have offered 15% to creditors, I have ones that pay the creditors in full. As a result it is difficult to tell you what is normal as normal changes depending on the specifics of the situation.

What you need to do is consult with a local trustee and they will look at where you are sitting and explain what needs to be considered when putting a proposal forward.

The baseline that everything is measered against is what you are worth to your creditors as legally and practically you have to offer more than this to get the creditors to cooperate. Then the composition of your debts will play a role as each creditor has a different tendency when it comes to voting. Finally your cash flow must be reviewed as it will also play a major role. As you can see there are a number of things to consider, but after your situaiton is reviewed you will have a pretty good idea of what it is going to take to get your creditors to come on board.