In our downtown Toronto office, one of the most commonly asked questions from people that meet with ask is “Am I the only one doing this? Am I alone?” Typically, we let people know that they are not alone and not the only one. And we now have the numbers to support this response.
If you are considering filing either a personal bankruptcy or a consumer proposal in Toronto you may be interested to know that there were a total of 1,482 consumer insolvencies filings in the first six months of 2011. Of the total filings for the first six months of 2011, Personal Bankruptcy filings represent 46% or 679 files and Consumer Proposals represent the balance of 54% or 803 files. From the same period in 2010, Consumer Proposal filings are up 13% and bankruptcy filings are down by 24%. In summary, over half of consumer insolvencies filed in the City of Toronto in the first six months of 2011 were consumer proposals and the number of filings is increasing!
So it would appear that more people in Toronto are taking advantage of a Consumer Proposal as a remedy for dealing with their debts than a bankruptcy. This is likely due the change in the bankruptcy laws that took place in 2009.
A consumer proposal offers an opportunity to repay a portion of what you owe to your creditors and eliminate your debts without filing for bankruptcy. We can say from our perspective the consumer proposal often makes the most sense for people that we see as it is a solution that deals with their debt with the least amount of impact on their lives. The consumer proposal process is very efficient; once the proposal is accepted by your creditors, you simply make the monthly payments as per the proposal terms. A consumer proposal is a legally binding, negotiated settlement made between you and your creditors. In a proposal, you will typically make one monthly payment over a period of time that can last no longer than 5 years. We usually base the payment on your budget – what you can afford to repay after things like rent and food etc. http://consumer-proposals.org/blog/2011/09/07/consumer-proposal-increase-2011/
It seems that it’s not just in Toronto that consumer proposals are out-pacing personal bankruptcies – we have been seeing similar trends in both Ontario and across Canada http://bankruptcy-canada.com/bankruptcy-canada-statistics/
If you think a consumer proposal may be the right option for you, contact us today by calling 310-PLAN or email us to book your free consultation to discuss your options for a fresh start.