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What is a consumer proposal?
A popular bankruptcy alternative, a consumer proposal, is a legal repayment agreement negotiated with creditors to settle your unsecured debt (credit cards, income tax debt, payday loans, etc.). Your Licensed Insolvency Trustee (LIT) will work with you to offer creditors a percentage of what’s owed and/or modified repayment terms based on what you can afford.
A consumer proposal is ideal for anyone who can repay some of their debt. The advantages of a consumer proposal are:
You'll likely only repay a portion of what you owe.
Once filed, interest charges, legal actions, garnishments, and collection activities stop.
You'll likely keep all your assets, including your car, house, and RRSPs.
Consumer proposals are federally regulated and require you to meet the following requirements, such as:
You must reside in Canada or own assets in Canada.
You must be insolvent, which means that you can't meet your financial obligations as they come due, or your debts exceed the value of your assets.
You must have unsecured debt.
Every person’s situation is unique, and consumer proposals are customized to meet your needs. After reviewing your income, assets, and debt, your Licensed Insolvency Trustee will propose an amount for repayment and present it to you and your creditors. If approved by your creditors, the amount you repay will typically be less than the amount initially owed, potentially by up to 80%. Your monthly payment will include all trustee fees.
Only a Licensed Insolvency Trustee (LIT) can file a consumer proposal on your behalf. If your LIT determines that a consumer proposal is the right step for you, you'll work together to draft a proposal to your creditors.
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I was treated with kindness and respect during a difficult situation that was hard to maneuver on my own. I couldn't have made this fresh start without them. The trustees and associates and everyone involved made the experience as seamless and painless as possible. I highly recommend this business if you are struggling financially and need some guidance. I am over the moon pleased with Grant Thornton Ltd.
— Angelique W, Vancouver, BC
I was waiting so long dreading the call, but I put my shame aside and called. The lady that picked it up was a saint. She made it so easy, and I could tell she cared about me as a person and not a number. Thanks to the Grant Thornton team. Cheers!
— Mik, Passage, NS
They were always available, even during COVID-19, and responded to me with quick and concise answers to any and all of my questions. The kindness I was shown by the staff & Trustee of the Thunder Bay office was unmeasurable. They made my decision one of the best I could have made!
— Donna M, Atikokan, ON
My debt has been such a huge weight on my shoulders over the last few years. Finally, I made the move to deal with it. I am so happy I chose Grant Thornton, and extremely satisfied and over the moon happy to have their help. They made the process so much easier. Very knowledgeable and always readily available. Thank you so much for all your help.
— Darlene S, Calgary, AB
Speak to one of our debt solutions professionals during a free, no-obligation consultation.
Yes. If you can continue to maintain payments, assets such as your home and car won’t be impacted by a consumer proposal.
Debt consolidation and consumer proposals are both ways to simplify debt payments. Consolidation loans combine debts into one monthly payment, but they may have high interest rates and fees, and you must repay 100% of the debt.
Consumer proposals are administered by Licensed Insolvency Trustees and offer lower monthly payments with the possibility to reduce your debt by up to 80%. They also have more favourable terms with 0% interest.
A consumer proposal will settle all unsecured debt such as (but not limited to):
A consumer proposal doesn’t cover secured debt (such as your mortgage or car loan).
Looking for tax, audit, and business advisory services? Visit Grant Thornton LLP Canada.
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