If you have searched the Internet for consumer debt proposal information in Lethbridge and you’re ready to file, how do you do it? You should already know it is not a “do-it-yourself” project and in fact the BIA (Bankruptcy and Insolvency Act) states a consumer proposal must be prepared and filed by a licensed bankruptcy trustee.
You should also know there are differences in some aspects of how the act is administered across the Provinces so if you live in Lethbridge, you’ll need a trustee licensed in Alberta. They will know what’s relevant to your particular situation.
Here are seven steps you and your trustee will need to take to file a Consumer Proposal in Lethbridge:
- Make a list of potential Alberta bankruptcy trustees to contact.
- Meet with a trustee to ensure a Consumer Proposal is right for you.
- Work with your trustee to complete a Statement of Affairs.
- Review the details of the proposal your trustee will present to your creditors.
- Your trustee presents the proposal to the creditors, who have 45 dates to vote for or against its acceptance.
- If accepted by a simple majority, the trustee files the proposal with the courts.
- The proposal becomes legally binding within 15 days of submission.
You can accomplish Step 1 by visiting these Lethbridge Bankruptcy Trustees. You can visit their website and even call them for consumer debt proposal information for Lethbridge residents, but for Step 2 you will need to sit down with one or more face to face and pick one with whom you are comfortable. Initial consultations are generally free of charge, so you have nothing to lose by interviewing several.
In Step 3 you will provide your trustee with all your financial details and based on that, the trustee will determine how much you can afford to repay your creditors and what kind of monthly payment you can afford over the allowable time frame. The BIA requires that a Statement of Affairs is filed with the proposal itself.
Steps 5 and 6 determine the fate of the proposal. The trustee presents the proposals and the creditors vote to accept or reject. The vast majority of Consumer Proposals are accepted and the process then proceeds to Step 7, where it is formally accepted by the courts.
However, if 25% of your creditors vote ‘no’ to the terms outlined in the proposal, an additional step comes into play – the Creditor Meeting. Simply put, the trustee arranges a meeting between you and the dissenting creditors to see if he or she can get the two sides – you as debtor and the creditors who voted no – to come to an agreement. Since creditors almost always prefer to opt for partial repayment over the potential of no repayment in a bankruptcy, it is rare that a solution is not reached.
In summary, filing for a Consumer Proposal in Lethbridge involves finding a bankruptcy trustee licensed in Alberta who will first assess your financial situation. Based on the assessment, a formal proposal outlining how much you can afford to repay and how long it will take will be prepared by the trustee and presented to your creditors for a vote of acceptance. Once accepted, the trustee files the proposal with the courts and it becomes legally binding.
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