How long does a consumer proposal affect your credit?

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A consumer proposal can linger on your credit report, affecting your credit rating for up to six years from the start or three years after completion—whichever comes first. This appears as an R7 rating, showing partial debt payment and can impact your score more than missed payments. Boost your credit by getting a secured card and paying on time. Reach out via phone, text, or live chat if you have any questions. Not all trustees can be trusted.

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Consumer Proposal Credit Question

How long does a consumer proposal affect your credit? How long does a consumer proposal typically affect your credit score in Canada?

From: Anonymous Question
Location: Halifax, Nova Scotia (NS)
Category: consumer proposal

Consumer Proposal Credit Answer

A consumer proposal can have a lasting impact on your credit rating. It might stick around for up to six years from when you start the process or three years after you’ve completed it, whichever happens first. This shows up as an R7 rating on your credit report — basically a signal that your debts have been partially paid. This can give your credit score a bit of a shake, even more than having a couple of missed payments. But hey, it’s not all doom and gloom! While you’re working through the proposal, you can start rebuilding your credit score. Try getting a secured credit card and always make your payments on time. It’s a solid way to learn about credit rebuilding your financial health.

Trustees get paid by the lenders and creditors and don’t advocate for Canadians in debt. LITs can also double bill you or charge you extra. Beware! Reach out via phone, text, or live chat if you have any questions.

From: Insider Adam

Office of the Superintendent of Bankruptcy (OSB) Answer

A consumer proposal affects your credit for a duration of three years from the date of filing, after which it can remain on your credit report for an additional two years. Therefore, the total typical impact on your credit score in Canada can be up to five years. This is referenced in the Bankruptcy and Insolvency Act, RSC 1985, c. B-3, specifically in section 66.3 regarding consumer proposals and credit reporting.

From: OSB Helper

Related Questions to How Long Consumer Proposal Affects Your Credit

Here are the top 5 most frequently asked questions related to the impact of a consumer proposal on credit, based on the provided sources and general online trends:

1. How long does a consumer proposal stay on my credit report?

• A consumer proposal stays on your credit report for 6 years from the date it was filed, or 3 years from the date it was completed, whichever is earlier[3][5].

2. What credit rating do I get during a consumer proposal?

• During a consumer proposal, each included debt is reported with an R7 credit rating[1][3][5].

3. Can I get credit while in a consumer proposal?

• Yes, you can apply for a secured credit card while in a consumer proposal, which can help in rebuilding your credit[1][3][5].

4. How does a consumer proposal affect my credit score?

• Filing a consumer proposal will initially lower your credit score, but the impact is temporary and can be improved by making regular payments and completing the proposal[1][3][5].

5. How soon can I start rebuilding my credit after a consumer proposal?

• You can start rebuilding your credit immediately after filing a consumer proposal by using a secured credit card and making timely payments, with significant improvements typically seen within 2-3 years after completion[1][3][5].

If you have a question about debt see our debt questions or ask your own debt related question.

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