A consumer proposal in Alberta, is a legal process which enables you to consolidate your debt and make an offer to your creditors to modify your payments or to repay only a percentage of what you owe. A proposal allows you a fresh start without going bankrupt.
You can make a proposal (or file bankruptcy) in Alberta if you:
are not presently in bankruptcy
owe at least $1,000
are not able to meet your regular payments as they become due; or
would not be able to pay all of your debts if all of the assets you are not allowed to keep are sold
Your company, partnership, or business may also file bankruptcy or make a proposal if it meets the above requirements.
However, any unsecured creditor to whom you owe more than $1,000 could try to force you into bankruptcy. In this case, the creditor must prove that you have committed an act of bankruptcy, such as not paying your bills as they came due. The court reviews the facts and, if the application is successful, issues a bankruptcy order which places you in bankruptcy by the creditor.
Briefly the steps to making a consumer proposal in Alberta are:
The Licensed Insolvency Trustee will help you prepare a Statement of Affairs which lists all of your assets, creditors, income, expenses and other pertinent information
Your finances will be reviewed and the Trustee will assist you in preparing a proposal to your creditors of all of your debts consolidated together
After you make your proposal, most creditors are no longer able to pursue you for collection of their accounts
Public utilities may not discontinue service
You make your payments to the Trustee who will pay your creditors until the terms of your proposal have been met
You will be required to attend two financial counselling sessions
Once you have met the terms of your proposal, you will receive a document stating that you completed your proposal and you will have no further obligation for the debts covered in your proposal
Creditors are not required nor do they have any legal obligation to arrange alternative payment terms with you. Furthermore, the creditor can end special arrangements at any time with little or no notification. Also, this option may not stop collection agents from calling.
Our qualified professional Licensed Insolvency Trustees and Administrators are familiar with all aspects of Canadian bankruptcy law and can provide you with options, whether consolidating through a consumer proposal or filing for bankruptcy. The earlier you contact us, generally, the more debt solutions are available.
Read more about the Benefits of Consumer Proposals (PDF).
Our Licensed Insolvency Trustees (formerly called Trustee in Bankruptcy or Bankruptcy Trustee) and Estate Managers believe everyone deserves a financial fresh start, while being treated with dignity and respect.
To speak to someone now call us at 310-8888 for a free, no obligation, confidential consultation.
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