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Author:		Joey
Date:		October 19, 1999
Question:		If a consumer proposal is made to my creditors, is this strictly an agreement between them and myself to pay a portion of the debt within my(our) current means or must I sell property, etc. to pay the debtload? Also, must all creditors be included in a proposal or can certain secured creditors be excluded? (i.e. I don't need my computer which is leased for work but I do use it for personal use and to complete correspondance courses) Would they need to be included? And finally, if a proposal is made and rejected, must I continue to pursue bankruptcy or can I proceed as I have been (borrowing from family, cash advances from cards, etc.) which is VERY VERY SLOWLY paying off some debt but still causes many headaches with others.
From:		Shane Brenneis, Collins Barrow Limited
Date:		October 21, 1999
Answer:		A proposal to creditors is whatever you want to make it. The funds can come from monthly payments, sale of property or assets or borrowed from a friend or relative. Once they accept your proposal, that is all the creditors can get. All creditors must be included in a proposal. Secured creditors are different as they hold security on your assets and you can write into the proposal that they continue to get paid. Alternatively, you can also write into the proposal that they take the asset back and any deficiency be included in the proposal. If you file a consumer proposal (Non-mortgage debts less than $75,000) there is no automatic bankruptcy if your proposal is rejected. Bankruptcy is an option, but you can make that decision at that time. If your debts are over $75,000 then you would file a Division 1 proposal and if this is not accepted then you would automatically be in bankruptcy. Cosigners are affected by a proposal or bankruptcy, because if you don't pay the total debt, the creditor can look to the co-signor for payment. Whether they would pursue the co-signor while you were in a proposal would be up to the creditor. To obtain a free assessment of your financial situation and which proposal may be the best for you, you should contact a Trustee in your area by looking in the yellow pages under "Bankruptcy". If you have any further questions or want to come in for a free assessment to our office, please call or email me using the information below. Shane Brenneis phone: (403) 298-1575 sbrenneis@collinsbarrow.com