Alternatives to Bankruptcy

A number of alternatives to bankruptcy exist for individuals who are facing financial difficulty. Listed below are various options which may be of assistance.

Consumer Proposal

Filing a Consumer Proposal to your creditors is a way to deal with an unmanageable debt load and are becoming a more and more popular way to deal with debt. Despite what you may read on the internet from other debt or credit service providers, only a licensed Trustee can file a Consumer Proposal on your behalf.   A Consumer Proposal allows you to reduce the debt you owe, extend the time you have to pay off the debt, or some combination of both without accumulating interest or additional fees.

Contact Your Creditors

Explain to your creditors how your circumstances have changed and explain why you cannot make your agreed upon payments. Suggest an arrangement that could work for both of you. Creditors are generally prepared to work with you.

Debt Consolidation Loan

You can approach a bank or financial institution about combining or “consolidating” your debts into one loan. The financial institution pays off all your debts and you only make a monthly payment to that creditor. There may be a qualifying process with the bank, and quite often, the bank will ask for a co-signor. In reality, this is generally not a viable option.

Informal Proposal

In some cases we can work with you and your creditors to set up a payment plan that will allow you to pay your creditors in an orderly way and thus help preserve your credit rating. This operates similar to a debt consolidation loan except you do not borrow the money to pay off your creditors.