As well... it's a really good idea to ask questions on this site.... so as to help others...

Did you speak to anyone regarding the Credit Proposal?

My company, Ken Rowan & Associates specializes in Proposals to Creditors, Debt Counselling, and Bankruptcy. I would be happy to help with any advice that would make your situation more reasonable. Please give me a call or send me an email through my Website. Best of luck.

A RRSP loan is NOT a secured loan because with all secured loans, a lien is attached to the asset that is offered as security for the loan. Under the Personal Property Security Act and the Income Tax Act ( Canada ), there is no provision to attach a lien to a RRSP. Conversely, if one has an RRSP, under the Income Tax Act ( Canada ), it cannot be used as security to obtain a loan because if the loan defaults, the lender cannot attach the RRSP for repayment. The only person who can transfer or collapse a RRSP or authorize the transfer or collapse of a RRSP is the contributor or the contributor's spouse if it is a spousal RRSP, the contributor's or contributor's spouses' executor or court appointed administrator in the event of death, or upon authorization from the contributor or contributor's spouse to an issuer of annuities or a RRIF ( Registered Retirement Income Fund ).

For information on a Personal or Consumer Proposal, see the following link. It is the best explanation that I have seen and is written in clear, simple everyday language.

http://www.sands-trustee.com/proposals/index.htm

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Educating one Consumer at a time

I am debating applying for a credit proposal. In 2008 I went through a separation and was heading for bankruptcy with a house I could not afford and monthly bills adding up to more than I was making. I talked to an agency that dealt with bankruptcy and they told me come back once the separation was finalized.

Once the separation was finalized I had sold the house and everything I had of value to avoided bankruptcy but I was left with a $47 000 dept which came from lawyer fees and the separation settlement. In the last two years I have been paying $400/mth towards my dept and I have 500/mth left to buy gas and groceries. I managed to pay off $2000 of the initial dept in two years, with no money left over to put aside every month all unforeseen expenses go on my line of credit. At the rate I’m going I’ll have my dept paid off in 47 years.

Here’s what I have in dept:
$12 000 RRSP loan at prime (RRSP has been cashed to pay lawyer fees)
$28 000 on a Line of credit at 3% + prime
$5000 on a Credit card at 2.9% for the next 9 months

I have excellent credit and have always paid my depts. The creditors are not calling; never had a late payment and I pay more than the minimum payment every month. I am not proud in considering a credit proposal and I’m not even sure if I qualify but it feel like I’m just treading water trying to pay off my dept.
I read that an RRSP loan is a secure loan but is still secured if the RRSP is no longer there?
I am not sure how a credit proposal works or if this is the only solution for me. Any advice would be appreciated.
Thanks