Consumer Proposals

A consumer proposal is also known as a Proposal to Creditors or Personal Proposal. It is a voluntary arrangement between the debtor, an independent trustee and the creditors. Essentially it’s a plan that lays out who, when and how much someone can pay towards their unsecured debts over a given period, usually up to 5 years.

The idea is to lay out a plan of action so all involved knows when their debts will be paid. The trustee will be a licensed bankruptcy trustee who will likely be overseeing plenty of consumer proposals at any one time.

Select debts can be included in a consumer proposal while leaving others intact. For example, if one can afford to pay the mortgage and car loan in full, but not credit cards and a loan, the first two debts would be left out of the consumer proposal and the latter two would be included.
That would mean continuing to pay the mortgage and car loan in full, but entering a plan to pay the credit cards and outstanding loan finance.

How a Consumer Proposal is Beneficial

A consumer proposal is a structured plan for those in debt to pay it back. That means, in most cases, the debtor can keep their assets, such as their home and car while they pay off the debt.
As long as all other debts continue being paid in full, all unsecured lending can be structured using a consumer proposal.

Entering into a voluntary consumer proposal helps in several ways:

  • It’s easier than a bankruptcy
  • It does not affect the credit rating as much (R7 status)
  • Assets remain in place
  • The plan remains regardless of change of circumstance
  • Buying a Car While Paying a Consumer Proposal

While a consumer proposal is less harmful than bankruptcy in every way, your credit history is impacted. That means mainstream lenders will think twice, or charge twice the interest for any future lending, at least until the credit score is improved.

Not so with Car Nation Canada and Dixie Auto Loans. We provide bad credit car loans for people in all sorts of situations including Consumer Proposals. We offer fair terms, fair rates and can be organized at one of our dealerships after you found your dream car.

So, if you need a bad credit car loan, are working within a consumer proposal or have adverse credit of any kind, you need to come see us today!