The sooner you pay off your consumer proposal – the better.
From the time you file your consumer proposal until it’s paid off, you will have an R9 credit rating (i.e bad debt; placed for collection; moved without giving a new address or bankruptcy). Once the proposal is paid in full, the R9 is replaced with an R7 credit rating. An R7 credit rating that results from filing remains on your credit bureau report for 3 years after the balance is paid in full. Therefore, if it took you 4 years to pay off your proposal, you’d have an R9 for 4 years and an R7 for 3 years (7 years of bad credit). If you it took you just one year to pay it off, you’d have an R9 for 1 year and an R7 for 3 years (4 years of bad credit).
It’s easy to see that there is a huge advantage to paying off your consumer proposal early. You will receive your certificate of full performance as soon as it’s paid in full, and are able to put your debt behind you and focus on rebuilding your credit rating sooner rather than later.
