Do you have older debt you would like to clear up?

If you have some older debt in collections but cannot afford to pay it in full, you can contact the creditor or collection agency to propose an offer to settle.

The creditor or collection agency might not accept your first offer, but they may provide a counter offer you can afford.  If you reach an agreement, always ask for confirmation in writing which clearly outlines the terms of the settlement reached.  After you receive confirmation — in writing, you can send your payment and keep confirmation of payment and settlement terms reached, in a safe place.  Do not rely on verbal confirmation alone; you need something in writing to hold the creditor accountable to the terms of the settlement agreement.

If you are not able to reach agreements with your creditors, besides Bankruptcy, you can also consider a Consumer Proposal.  In a Consumer Proposal, one offer is made to all of your unsecured creditors; usually consisting of a monthly payment for a pre-determined number of months.  The sum of all these monthly payments would cover proposal administration costs and the balance would be divided among all of your unsecured creditors on a pro-rata basis.

Once a Consumer Proposal is filed, collection and/or legal action must stop and creditors will have 45 days to vote on your offer.  Each creditor receives 1 vote per $1 owed and the proposal is deemed to be accepted as long as a simple majority of unsecured creditors accept the offer (50% + 1).  An accepted Consumer Proposal will become legally binding on all unsecured creditors — even the ones who may have voted against the proposal or failed to register a vote within the required time frame.  

A Consumer Proposal will provide some benefits which are not applicable in a Bankruptcy.  In a Consumer Proposal, increased income, bonuses, overtime, retro-active pay, inheritances, lottery and other windfalls are yours to keep and use at your discretion.  A Consumer Proposal has no mandatory minimum time frame — the balance can be paid off and proposal completed at any time without penalty whenever you have the extra funds for completion.  The record of filing a Consumer Proposal will be purged from your credit report quicker than a Bankruptcy; the sooner you pay it off, the better.

If you would like to learn more about Consumer Proposals or any other option for debt relief, please do not hesitate to contact our office for a free consultation.  At Jaime Johnson & Associates, you will work directly with a Licensed Insolvency Trustee — from the beginning as we explore your debt relief options, to the end as you achieve debt relief.  For a free consultation, you can call or text (506) 645-1814; email jaime@tackledebt.ca or visit us on-line at www.tackledebt.ca.

We are pleased to offer Debt Consulting, Debt Relief, Consumer Proposal and Bankruptcy services to the following areas: Saint John, St. Stephen, St. Andrews, St. George, Grand Bay-Westfield, Fredericton, Oromocto, Rothesay, Quispamsis, Hampton, Norton, Sussex, Petitcodiac, Moncton, Riverview, Miramichi and all places in between.