When you have reached the end of your rope with managing debt, where do you turn to get help? There are a number of options available to Canadian consumers such as personal bankruptcy, consumer proposal, debt settlement via debt pooling and informal consumer proposal. Depending on your financial situation, not all options are viable solutions.
Newly released statistics show the number of debt settlement proposals filed by consumers in Saskatchewan has nearly doubled in the last year. This comes after Statistics Canada showed Saskatchewan is being the province with lowest credit card delinquency rates in 2013 at 0.20%.
Yet the Superintendent of Bankruptcy says 80 consumer proposals were filled in Saskatchewan in July of this year. That is an increase of nearly 82 per cent compared to last year, and this increase is still expected to continue before the year is up. Nationally, the number of consumer proposals rose 13 per cent compared to July 2013.
So what is involved with filing a formal consumer proposal?
Negotiating debts with a formal consumer proposal requires a bankruptcy trustee. All debts are required to be disclosed and put on the program. The trustee puts together an offer to pay creditors a percentage of what is owed to them over a specific period of time, or extend the time the debtor has to pay off the debt, or a combination of both. The creditors may vote to accept the proposal as presented by the trustee but they can also reject it, in which case the debtor is no longer protected from creditors attempting to take legal action to recover payment. If accepted, debt repayments are made through the trustee, and the trustee uses that money to pay each of the creditors. The debt must be paid off within five years. There is no room for flexibility with a consumer proposal, more specifically, you do not have any flexibility on what you want to pay, nor can you prioritize or exclude any creditors. Furthermore, if you miss more than two payments the consumer proposal program will become null and void. A person would need to ensure payments are not missed for any reason or they will fall back to square one with their debt. Consider possible dangers in this scenario such as an unexpected job loss or cut in pay, an illness that keeps a person from earning income or a divorce. Each scenario can jeopardize a formal consumer proposal repayment plan. One cannot prepare for these kinds of things and it makes it enormously difficult to resolve debt when any can occur.
Is there another option that offers more flexibility in paying off debt?
Yes, there is. OCCA Consumer Debt Relief offers a tailored debt relief program based solely on offering repayment terms to the creditor based on the consumer’s true financial position, ability to repay and a reasonable time frame.
The Benefits of the OCCA Informal Consumer Proposal:
o Protection and representation of consumer from the first day of membership, including in-house Paralegal services within Ontario, utilization of legal techniques and proven professional negotiation services;
o Unlimited flexibility in repayment plan that does not involve institutionalized rules or rigid guidelines that may not suit a consumer’s particular needs or budget. Repayment plan can include lump-sum settlement, finite-term plan and unlimited protection due to financial hardship;
o Payments to creditors are provided directly by the consumer; no consumer’s funds are held in Trust or a joint bank account;
o Finally, the membership is not over until all debts are resolved.
So to those indebted people in Saskatchewan as well as nationwide Canada, we invite you take another look at the options for tacking their debt other than formal consumer proposals. It will be worth your while in the long run!
For more information about OCCA Consumer Debt Relief and it’s program, visit www.occa.ca.
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