What does it cost to file a consumer proposal in Sarnia?

by Joel Sandwith on October 22, 2010

Filing a consumer proposal can be an excellent alternative to personal bankruptcy.  It can allow you to keep your assets, such as a car or house, and can in some cases substantially lower the amount of debt you need to repay.  Best of all, a consumer proposal is usually done in the form of a monthly payment, so that you can build a budget around it.

So, this sounds wonderful, but a question we get quite frequently is what does it cost?  Only a licensed trustee in bankruptcy can administer a consumer proposal, and the fees that a trustee charges are outlined by the Bankruptcy and Insolvency Act.  So, what does this mean for you?

The way that the fees are charged is simple – you pay a monthly amount, and the trustee takes their fees out of that payment.  Here’s an example – let’s say your debts are $25,000.  Your trustee recommends a consumer proposal of $14,400, with a low payment of $300 per month for 48 months.  This saves you over $10,000, and is probably a lot easier to afford than your current payments.  The total of $14,400 INCLUDES all fees, and all taxes on the fees.  This means there should never be an added or extra fee to file a consumer proposal, and that all trustees should be charging fees the same way.

Now that you know how the fees work, here are a few things to consider.  One, always ask about the fees you are being charged – for example, be wary of outfits – ‘debt consolidators’ – and the like, who want to charge you $500 or $2000 up front – they might do nothing for you, and just send you to us anyway.  Meeting with us is free, and you don’t need a referal.

Second, always ask how your trustee has come up with the number they suggest.  We always take care to approach every consumer proposal the same way – we want to balance what you can afford, with what your creditors are expecting. 

If you’d like an evaluation of your situation, to determine whether a proposal is a good idea, and if so, how much to offer, please give us a call to book a free meeting.  We can be reached toll free at 310-PLAN (7526) – no area code required, or locally here in Sarnia at 519-344-1058.

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