A "consumer proposal" is a formal agreement under the Bankruptcy and Insolvency Act that permits you to settle debts for less than you owe. When filing paperwork, your Licensed Insolvency Trustee's review of your financial situation is the foundation for your offer or payment arrangements. Your monthly payments will be tailored to your financial situation.

What transpires if your financial status changes, for the better or worse? In the post, we will go through some questions about what happens after filing a consumer proposal in Kamloops, BC, what to do if your income goes up, and what to do if it goes down, maybe due to a job loss or illness. 

Here we answer all these questions through the paragraphs below.  

1- Q1. Will an income change affect consumer proposal payment? 

One of the major benefits of a consumer proposal over bankruptcy is that your payments won't increase if your income rises during process. Your repayment conditions are fixed for the duration of the proposal after it has been accepted. This implies that the monthly payment will stay the same even if your salary increases once it is accepted.

But what happens if your income decreases? You must speak with your trustee to better understand the situation.  
 
2- Q2. What will happen if you get a default on your consumer proposal? 

If you miss three payments in a row, a consumer proposal in Kamloops is ruled to be void. A considered annulment occurs if three months have passed since the payment was due if your consumer proposal is set up so that payments are not required monthly. A stay of proceedings expires, and creditors can seek full repayment of the unpaid amount, including interest collected since the filing date.  
 
3- Q3. What options do you have if you have a material adverse drop in income? 

If action is taken quickly enough (within 30 days of default), it is feasible to reinstate an annulled proposal; however, it is far preferable to take proactive measures if your income declines and you fear you won't be able to finish your proposal as initially filed.

If your proposal is almost finished, you can file an adjusted consumer proposal in Kamloops for the amount you have already paid to make a reduced monthly payment.
 
4- Q4. What will be the result if you get a windfall? 

Your assets vest with you in a consumer proposal in Canada, meaning you keep them and are free to utilize them in any way you see best. You also own any new assets you acquire after your request is accepted.

Fifteen days after the creditors have accepted your consumer proposal, it is officially court-approved.

Closing Remark 

A consumer proposal might be a suitable choice if you're thinking about it and think your income might rise or if you're concerned about receiving an inheritance in the future. 

At Mike Wright & Associates Inc., you can book a free consultation with a LIT to discuss all your issues and doubts about a consumer proposal in Kamloops. Visit our website and get all information on potential debt solutions you require. 

Shane Taylor is the author of this article. To know more about Commercial Proposal in Kelowna, BC please visit our website: debtfreebc.ca