DEBT RELIEF OPTIONS IN GUELPH, ONTARIO
Consumer Proposal
A consumer proposal is one of the most effective strategies for addressing overwhelming debt, whether it stems from credit cards, taxes, or personal loans.
This option may be ideal if you don’t qualify for a debt consolidation loan, can’t repay your full debt, or if your debt exceeds the value of your assets.
A consumer proposal is a legally binding agreement between you and your creditors that consolidates your debt and allows you to settle it for less than the total amount owed. Our Licensed Insolvency Trustees (LIT) will work with you to evaluate your financial situation and determine if a consumer proposal is the best solution. We’ll then help you establish an affordable monthly payment plan. Once your LIT submits the proposal to your creditors and it’s accepted, you’ll make monthly payments. After fulfilling the terms, the remaining debt will be discharged.
Key benefits of a consumer proposal include:
- Discharging up to 75% of your debt
- Stopping all legal actions, such as wage garnishments or frozen bank accounts
- Ending all collection calls
- Retaining all assets, including tax refunds
- No additional interest on any debt included in the proposal
It’s important to note that only Licensed Insolvency Trustees, like those at Chande Debt Solutions, are authorized to file consumer proposals in Guelph.
Debt Consolidation vs. Consumer Proposal
Many Canadians weigh the pros and cons of debt consolidation versus a consumer proposal. While debt consolidation in Guelph can help maintain your credit score (provided payments are made on time) and allows you to work exclusively with your financial institution, it also has its drawbacks.
Personal or home equity loans often come with high interest rates, and depending on your credit and payment history, you may not qualify at all. Additionally, with a consolidation loan, you may continue to have access to high-interest credit cards and other accounts, which can perpetuate financial problems if spending habits aren’t adjusted.
In contrast, while a consumer proposal does affect your credit score and only covers unsecured debts (such as credit card debt, personal loans, tax debt, or possibly older student loans), it offers significant advantages. These include the ability to discharge up to 75% of your debt, stop all legal actions and collection calls, and halt any additional interest on the debts included in the proposal.
Personal Bankruptcy
In some cases, personal bankruptcy may be the only feasible option. Generally considered a last resort when all other options have been exhausted, bankruptcy offers a quick and cost-effective solution to debt problems. However, it carries serious consequences, including a substantial impact on your credit score and the loss of any non-exempt assets. Let Chande Debt Solutions be your bankruptcy trustee in Guelph!
