Gambling and Consumer Proposals Ontario: Introduction
Gambling and Consumer Proposals Ontario are treated very differently than in a Bankruptcy in Ontario. One of the most common questions that people in difficult financial situations ask is: what’s the difference between a consumer proposal and bankruptcy?
Personal bankruptcies and consumer proposals are two of the most common solutions available for personal financial issues. While both are designed to help people resolve debt issues and give users the necessary protection from creditors, learning what’s the difference between a consumer proposal and bankruptcy can help people make more informed decisions in the future.
Gambling and Consumer Proposals Ontario: Consumer Proposal debt limitation
With a consumer proposal, it is only possible for you to claim it if your total debt does not exceed $250,000, excluding the debt owing on the mortgage(s) on your home. Additionally, you must be able to repay a part of those debts to apply.
Gambling and Consumer Proposals Ontario: Creditor acceptance
However, your creditors must accept your proposal, as you do not automatically earn it upon signing up for the option. With bankruptcy, however, any person who owes their creditors more than $1,000 in debt is eligible to file without the need for creditor approval.
The ideal candidates for this situation are those who need some type of immediate financial relief and whose income and budget do not allow them to pay off the reduced amount agreed to in a consumer proposal, on a monthly basis, up to a maximum of 60 months.
Gambling and Consumer Proposals Ontario: Fixed consumer proposal monthly payment vs. potential variable surplus income bankruptcy payment
In order to resolve the financial issues, you and your creditors need to agree to a proposed amount with a consumer proposal, hence the name of the program. This is a monthly amount that you need to pay consistently, but it stays the same for as long as the proposal is in effect. With bankruptcy, however, monthly payments may vary based on the amount of money that you make. The more that you regularly earn, the more you need to pay per month.
Gambling and Consumer Proposals Ontario: Surrendering of your assets in a bankruptcy
With a consumer proposal, you do not need to surrender your assets. With bankruptcy, however, with only certain minor exceptions, you will have to surrender your assets to your licensed insolvency trustee. The Trustee sells them and will use the money to pay for the cost of administration. The Trustee might also pay a dividend to your unsecured creditors.
Gambling and Consumer Proposals Ontario: Credit rating
With a consumer proposal, your credit rating will receive an R7. This indicates you have undergone such an agreement. It will remain for up to 3 years after paying off your loans. With bankruptcy, you earn an R9 rating. That is the worst that you can have. It can stay on your report for a period of 7 years.
Gambling and Consumer Proposals Ontario: Debts from an addiction
The Bankruptcy and Insolvency Act and the Superintendent of Bankruptcy, are very concerned about debts that have arisen as a result of addiction. The Licensed Insolvency Trustee must ask questions to decide if any debts have arisen as a result of addiction.
Once so determined, in a bankruptcy, the licensed insolvency trustee must oppose the bankrupt’s discharge. In order to hope to get an absolute discharge from the Court, the bankrupt will have to go into a rehabilitation program. They will need to prove they have completed a recognized program and continue to seek help. The person will also need to show they are no longer spending money on such addiction.
These are all good things for the total rehabilitation of the individual. It differs from the treatment under a consumer proposal. The licensed insolvency trustee will still want to make sure that the individual is seeking help for their addiction. If you complete your consumer proposal payments there will never be a bankruptcy. Your consumer proposal is successfully completed. You also avoid the onerous issues of discharge from bankruptcy. The treatment of gambling and consumer proposals Ontario as compared to bankruptcy is huge for the individual.
Gambling and Consumer Proposals Ontario: Are you suffering from too much debt?
If you are an individual or company who needs to free themselves from the stress and strain of too much debt, and especially if you have been told your situation is hopeless because of an addiction, Ira Smith Trustee & Receiver Inc. can prepare and carry out the plan made just for you, to free you from the burden of your financial challenges to go on to live a productive, stress-free, financially sound life.
If you’re experiencing serious debt issues for any reason, contact a professional trustee for a free, no-obligation consultation. The Ira Smith Team does not try to write new insolvency laws or tax laws. Rather, we will evaluate your situation within the existing statutes, and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counselling, debt consolidation or a consumer proposal or bankruptcy. Starting Over, Starting Now you can be debt-free with the help of a professional, licensed insolvency trustee. Contact us today.
