What is a Certificate of Full Performance?
When you complete your consumer proposal, your Licensed Insolvency Trustee will give you a Certificate of Full Performance.
It’s proof that you attended the financial counselling sessions and completed your consumer proposal.
When you receive your Certificate of Full Performance, it’s a good idea to send it to both major credit bureaus: Equifax and TransUnion. By doing so, they can update your credit report accordingly. You can also send your certificate to lenders when you apply for credit.
Even though credit bureaus are notified by the Office of the Superintendent of Bankruptcy that you’ve completed your proposal, mistakes do happen.
Sending the certificate ensures that your consumer proposal is marked as discharged on your credit report and allows the credit bureaus to correct any errors. As a result, you might also see an increase in your credit score.
When your proposal is finished, your credit report should display no balances for the included unsecured debts. You’ll want to get a copy of your credit report to ensure this is the case.
See also: How to read a credit report
What happens after you receive a Certificate of Full Performance?
When you file a consumer proposal, a note will appear on the public records section of your credit report referring to your consumer proposal with the date it was filed.
Once you have completed your proposal and received your Certificate of Full Performance, the note on your credit report will be updated to state that you have successfully done so.
When reviewing your credit report, make sure that there are no mistakes. If you spot any errors, tell the credit bureaus immediately and ask them to update or remove any information that shouldn’t be there.
Once it has been three years since you completed your consumer proposal or six years from the date you filed (whichever comes first), you’ll notice that it no longer appears on your credit report.
What debts are released when you receive your Certificate of Full Performance?
When you finish your consumer proposal, you are released from your obligation to repay the remaining balance of your unsecured debts.
You can eliminate most unsecured debts, such as:
- Credit card debts
- Personal loans
- Payday loans
- Bank overdrafts
- Utility bills (You can’t include bills for services you are continuing to use)
- Unsecured lines of credit
- Income tax debts (unless the CRA register a lien on your property)
- Student loan debt if you haven’t been a student for seven years or more
- Unpaid rent
- Debts owed to friends and family.
But you cannot eliminate all debts, such as:
- Secured debts such as a mortgage or car loan.
- Property taxes.
- Any fine or penalty imposed by a court, such as a parking ticket or fine.
- Unpaid alimony or child support.
- Debts obtained by fraud.
- Debt obtained through false pretence (e.g. lied on a loan application).
- Student loans (if less than seven years since you were a student).
- An award by a civil court for damages arising from personal or sexual assault.
Rebuilding your credit after you receive your Certificate of Full Performance
After completing a consumer proposal and receiving your Certificate of Full Performance, you have successfully eradicated your debts, and you can start rebuilding your credit.
If you’re considering filing a consumer proposal, discuss your situation with a Licensed Insolvency Trustee. There is no obligation, and the appointment is free.
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