The consumer proposal is a very effective solution to financial problems that allows an over-indebted person to settle their debts without losing their assets (house, vehicle, etc.). Despite its growing popularity, the consumer proposal remains a solution little known to the majority of Quebecers. It is often easier to explain this solution in detail by using an example. Here is a typical example that will allow you to better understand the consumer proposal.
Troy, a construction contractor, is married and has two children. He owns a house with his wife, Liza, and they both have paid vehicles for their respective names.
For some time, Troy has had difficulty finding contracts. Liza, meanwhile, had to change jobs following the closure of the company for which she had been working for more than ten years. Finding a new job was not easy and she resigned herself to a lower-paying job than before.
Pay off their credit cards
Over time, debts have accumulated and the couple is now having difficulty making their monthly payments. They thought of selling their homes and vehicles to pay off their credit cards and lines of credit, but soon realized that the profit they could potentially make would not be enough to cover all the debts. They also had late payments which made the bank refuse to lend them more. Liza and Troy are at a dead end and are therefore considering making a consumer proposal to solve their debt problem.
The consumer proposal would indeed be appropriate for the couple, because it would allow them to keep their assets and pay their debts taking into account their current financial situation.
After analyzing their situation, including the value of their assets and their monthly income and expenses, a consumer proposal of $ 265 per month for 60 months could be possible for Liza and Troy. This proposal would thus balance the monthly budget of the couple.