Consumer Proposals Have No Limit: There is no limit to the number of consumer proposals you can file with a Licensed Insolvency Trustee (LIT). This is the simplest answer to the question we can provide, but there are a few caveats that you should be aware of since they do augment the answer somewhat.
Eligibility Is Determined Individually for Each Proposal
One of the caveats is that you must meet all the requirements to file a consumer proposal each and every time you file. You don’t accrue “frequent debtor miles” or anything like that. This means that you will have to have sufficient debt and an inability to make timely payments. You will also have to work with a LIT and ensure that they are willing to work with you to file the consumer proposal.
You Can’t Have More than One Active Consumer Proposal at a Time
Additionally, you cannot file a second consumer proposal while in an active one. So, if you have accrued debt since your first consumer proposal, you cannot seek a second consumer proposal to address it, nor can you add this debt to your existing proposal. In these situations, the solution would be to collapse or amend your existing proposal to include the new debt.
Frequently Asked Questions About Multiple Consumer Proposals
These are the main caveats that you need to consider when filing multiple proposals. However, there are often additional questions that arise from individuals worried about pursuing this line of financial assistance. Below, we address some of the more common questions and provide answers to them.
Do Subsequent Consumer Proposals Cost More?
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There is no cost difference between filing your first consumer proposal and your second or any number thereafter. This helps ensure that this federal process is made available to everyone on a consistent and equal basis regardless of their past financial history.
What Happens When My Proposal Is Annulled or Rejected?
Consumer proposals will not be annulled without sufficient information or reason. This means that they are only going to occur if they were filed incorrectly or if the terms allow for the annulment based on the factors described in the proposal. Understanding the specific terms that could lead to an annulment on your first or subsequent proposal is best done with the aid of your LIT.
Proposals will only be rejected before they are accepted. They can be rejected if the information is not correct, the majority of creditors do not agree with the proposal or other extenuating circumstances. Typically, the fix to a rejected proposal is to make suitable changes and resubmit it.
Where Will My Credit Score Stand After a Consumer Proposal?
Successful consumer proposals will put you at the lowest assigned credit score, and they will come up during credit checks for the balance of the proposal’s term. This process is consistent with your first, second and subsequent proposals.
Consumer proposals can be a great way to regain control of your finances, unburden yourself from persistent creditors and ensure that you have the support you need to properly manage your finances in the future. As Licensed Insolvency Trustees (LITs) are a mandatory part of the process, seeking them out is the first step in regaining your financial independence.