Negotiating with Creditors

If you owe consumer loans and credit card debts, some creditors at the collection stage may accept a discounted amount for the debt as long as the settled amount is paid in one lump sum and not by way of instalments. If that option is not feasible for you, filing a consumer proposal through a trustee is a common solution but you would require some level of steady income to do it. Under this option, you will offer monthly payments of usually between 36 and 60 months with the aim of providing a better return to your creditors than if you were to proceed to a bankruptcy filing. With this in mind, you will still need to provide a return of usually at least 20% after cost of administration of the proposal. You will only need 51% of creditors (by $ value) voting in favour of the proposal in order for it to be binding on all unsecured creditors. If you have no income or assets to speak of at this time, there is very little your creditors can do to collect. You may wish to wait until you obtain a steady income and then consider a proposal.