If you are experiencing financial problems and you have the ability to offer something to your creditors, a proposal may be a good option. There are two types of proposals: a consumer proposal and a Division 1 proposal. MGM Trustee has a team of knowledgeable, experienced and friendly professionals that can help prepare and file a proposal to your creditors.
- A formal, legally binding debt settlement with creditors usually to pay a percentage of the amount owed. It can also be for an extension of time.
- Alternative to filing an assignment in bankruptcy
- Filed with an adminstrator of consumer proposals (Licensed Insolvency Trustee - LIT)
- Regulated by the Federal Government
- Stops wage garnishment and legal action by unsecured creditors
- Filed by individuals whose debt is $250,000 or less (excluding mortgage on principal residence)
- Usually debtor retains possession of their assets
- Terms of proposal cannot exceed 5 years
- Payments are usually monthly and there is no interest
- Two financial counseling sessions provided
- Creditors vote on proposal
- Majority vote required for acceptance
- If rejected by creditors, no deemed bankruptcy
For complete information on the consumer proposal process, contact MGM Trustee.