Will A Consumer Proposal Affect My Credit?
A consumer proposal will affect your credit. A record of your consumer proposal will be on your credit file from the day you file your proposal until it’s paid in full and a further 3 years thereafter. More specifically:
Equifax removes a consumer proposal from your credit report 3 years after you’ve paid off all of the debts included in the proposal.
TransUnion removes a consumer proposal from your credit report either:
3 years after you’ve paid off all of the debts included in the proposal, or
6 years after you sign the proposal (whichever is sooner)
Rebuilding Credit After A Consumer Proposal
Although you have up to 60 months pay your consumer proposal in full, you have the option of paying it off faster if you are able to. The more quickly you pay off your proposal, the more quickly you can rebuild your credit.
For example, if you file your consumer proposal on November 2019 and it’s paid in full by November 2022, a record of your proposal stays on your credit file until November 2025. Thereafter, you can do the following to rebuild your credit:
- If your goal is to eventually apply for a mortgage to purchase a home, lenders generally use a 2/2/2 rule: 2 years discharged, 2 new credit accounts, $2,000 minimum credit limits with good repayment history. The easiest way to start is to obtain a secured credit card. Because your credit utilization rate is a major factor in your credit score, try to get card with a moderately higher credit limit (e.g. $2,000) – using a card with too low a credit limit will be of limited use in rebuilding your credit score.
- Use your credit card consistently – use it for everyday purchases and pay off the balance in full at the end of the billing cycle. By doing this, you’re reestablishing your payment history. Doing this over a long period of time will gradually increase your credit score since the length of your credit history contributes to your credit score.
If you want to work with a Trustee who will give you confidence and peace of mind that your consumer proposal is being dealt with in a professional manner, look no further.
Reviews of Our Services
Victor was quick to contact me and the consistent contact was amazing. Victor is really passionate about listening to my needs and it showed as his service with me was nothing short of an amazing experience. He went out of his way to meet on my sched and his attention to detail is exceptional. If yo
Victor and his team (Mary) were always extraordinarily prompt with their responses to any inquiries and went out of their way to respond to questions in detail. They were extremely helpful at all times, even after my Proposal was completed. VIctor is an excellent advocate for his client's needs and
Victor and his team were amazing. Treated us with the upmost professionalism. Answered all our questions, took care of everything and turned an unfortunate situation and made it much less stressful. I highly recommend Fong and Partners. Thank you all for your support through the process.
Working with Victor Fong was great. We just finished our consumer proposal a week ago and the entire process was quite easy. Mary was amazing at answering all my questions and accommodating me when I had any questions or concerns. Her response time was impeccable. Our initial meeting with Victor wa
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