Consumer Proposal

How do I get out of debt? A consumer  proposal might be the solution for you. A consumer proposal is one of two viable government-sponsored option for debt reduction/debt relief. (The other one is bankruptcy.) It is for people who:

  • have unsecured (line of credit or credit card) debts not exceeding $250,000 (excluding mortgages)
  • have the ability to pay some but not all of their debts
  • are insolvent (owe more than they earn).

A consumer proposal differs significantly from credit counselling in that with credit counselling, each creditor can accept or reject the plan. You will remain indebted to lenders who reject the plan. With a consumer proposal, if the majority of creditors accept the plan, they are alllegally bound to it.

When you file a consumer proposal, your will have an R7 credit rating for the duration of your payments and three years thereafter. Payment do not last beyond 5 years.

The pages in this section give you more information on filing a consumer proposal. If you have assets that you would like to protect, a consumer proposal may be your best solution. (Without assets, you really should consider bankruptcy!)

Consumer proposals are offers made by debtors under the Bankruptcy and Insolvency Act (BIA) to modify their payments to creditors. For example, debtors may propose paying a lower amount each month over a longer period of time, or paying a percentage of what they owe. Such a proposal must be completed within five years. (OSB)

Post to Twitter