The TRUTH about credit counseling (CC) & consumer proposals (CP)
Let us educate you about Credit! By filling Consumer Proposals and Credit Counseling you are actually making your situation worse. Don't apply for credit counseling, consumer proposal or bankruptcy until you talk to us. Call today 1-800-774-3408
Credit Counseling (CC) and Consumer Proposals (CP) stay on your credit report for 3 years from the "date settled"
Many consumers choose to enter into consumer proposals & credit counseling services in an attempt to avoid bankruptcy. Why? Bankruptcy will be shown on bankrupt’s credit rating as long as 7 years after discharge Bankrupt loses some professional and civil privileges, i.e. capacity to hold money in trust, capacity to be elected to certain civil positions Bankruptcy still carries negative stigma, i.e. negatively influence bankrupt’s credibility in the community. What most consumers do not understand is that "Date Settled" refers to the date of last payment to CC/CP.
Consumer B has an R7 rating on all trade lines included in CC/CP on credit report for 3 years from the "date settled". Consumer B made 5 years of set monthly payments prior to date settled, in retrospect consumer B will have R7 rating for total of 8 years on all trade lines included in CC/CP. What does this all mean for the Consumer? When comparing the two examples both consumers would have bad credit R9 and R7 ratings, however consumer A who filed for bankruptcy would have an R9 rating for 8 years with the ability to start re establishing credit right away. Whereas consumer B who entered a CC/CP will not be able to rebuild credit until the "date settled" 5 years later.
The Following is an example of CC/CP verse Bankruptcy and the-long term effect on your credit for each:
Consumer A files for Bankruptcy pays established monthly payments to Trustee for 9 months and is discharged. Consumer A has an R9 rating on all trade lines included in bankruptcy on credit report for 7 years from "date settled" or "discharge date " for bankruptcy proceedings. Consumer A made 9 months of set payments prior to date settled, in retrospect consumer A will have R9 rating for total of 8 years on all trade lines included in bankruptcy. Consumer B files CC/CP for $30K pays established monthly payments to Trustee or Credit Counseling Company for 5 years.