Would I qualify for a consumer proposal?
I am currently on EI, laid off because of low oil prices, but will be called back to work eventually (not permanent). Even when working full time, I found it difficult to keep up with payments. I have used up almost all my savings in just keeping up with the payments along with the EI payments to help. My EI payments are just enough to cover my vehicle payments, insurance, mortgage, etc. But I have approximately 30K in unsecured debts, and those payments have drained my savings. I am at the point where I can’t keep up anymore, and soon will have voluntarily to give up one or both of my vehicles. Would I qualify for a consumer proposal? I do not want to have to go bankrupt and lose everything I have worked for, because of a temporary layoff.
It’s tough to say from just the information you’ve provided, but it’s important to keep in mind that consistent payments are very important in a consumer proposal. Because of this, sometimes when income is up and down or not predictable, keeping up with payments can be challenging. The legislation only allows the equivalent of three monthly payments behind until the proposal is in default and would be considered unsuccessful. The likelihood of a proposal being successful would also depend on whether your creditors would be getting a greater recovery than they would if you were to file a bankruptcy. I know that you want to avoid bankruptcy, but keeping assets like a home and vehicles is a possibility in filing a bankruptcy because it depends more on the equity of those assets (the difference between what the assets are worth and what is owed on them) then the fact that they simply exist. I always recommend talking to a local trustee to get an idea of what each different process would like for your individual situation.