Installment Loan Contract With Consumer Proposal In Suffolk
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FAQ
The debt limit for filing a consumer proposal is less than $250,000 in total unsecured personal debts.
If you default on three payments during the term of the proposal, the proposal is annulled. This means the proposal is brought to an end by default. In certain circumstances, an amended proposal may be filed prior to the default occurring.
A consumer proposal is automatically annulled if you miss three monthly payments or miss one payment by more than three months if you are not on a monthly payment schedule. When this occurs, the terms of the agreement are no longer in effect. This means interest rates and penalties on your debts can be reinstated.
The purpose of a consumer proposal is to allow you to negotiate a revised payment plan with your creditors. By forgiving a significant chunk of your debt (in some cases, up to 80%), your payments shrink considerably, giving your budget some much-needed breathing room.
The total amount of debt owing, excluding the mortgage on your principal residence, must be less than $250,000 in order to qualify for a consumer proposal.
You can keep credit cards when you file a CP so long as you have no balance on them on the date your CP is filed.
Long-Term Effects on Credit As mentioned earlier, the consumer proposal stays on your credit report for three years after you have completed it, but you can start improving your credit score as soon as you begin making consistent payments.
