Debt Agreement Proposal Definition

Once the payment period is complete, all remaining debts will be cancelled and insolvency will be removed from your credit reference file five years after the debt contract is approved or after the conclusion of your debt contract, the last being the last. Learn how to submit a consumer proposal in Canada or contact us for a free consultation. Once you paid the agreed amount, you paid that debt. Once your documents are complete, you must read them, sign them and send them back to Fox Symes. We then submit it to AFSA (see below). Your file must be submitted to AFSA within 14 days of signing and the date of the proposal and declaration. What will happen to my secured debts, such as my car loan and mortgage? You fill out 3 forms and file 3 forms with AFSA: a debt contract proposal, a justification and a declaration. The debtor contract manager (or, in some cases, broker) will help fill out the forms, including the details of the proposal you make to your creditors. Forms must be received by AFSA within 14 days of signing.

The debtor must read the prescribed information on the alternatives and consequences of bankruptcy and debt contracts. We will discuss this with you and explain your options. These formal options can free you from debt, but they have serious long-term consequences. You may influence your career and your ability to obtain loans or credits in the future. If your income is high enough for you to have to pay high monthly surplus income and you want to avoid bankruptcy, a consumer proposal program can be a good choice for you. You can continue to pay your creditors during the processing period, the amount of debt included in the debt contract is the amount owed on the reference date. However, you should pay your secured creditors all the time, as these are not included in the debt contract. In order for a debt contract to be approved, creditors representing at least 50% of the value owed must vote in favour of its adoption. Once they do, it is legally binding on all your creditors and they cannot sue you or take further legal action as long as you comply with the terms of the agreement.