How do I file a consumer proposal?

Learn how to file a consumer proposal and take control of your finances.

Filing a consumer proposal is ideal for people who are struggling financially but can pay back some of their debt. Our Licensed Insolvency Trustees (LITs) and debt solutions professionals can help you decide if a consumer proposal is the right solution for you.

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Before you begin

A consumer proposal is a formal debt management solution that can reduce your unsecured debt—debt not tied to an asset such as a house or a car.

Unsecured debt can include:

  • Credit cards
  • Lines of credit
  • Personal loans
  • CRA (Canada Revenue Agency) income taxes
  • Payday loans
  • Student loans (if older than seven years)
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Step 1

Book your free, confidential consultation with a debt solutions professional

During your consultation, one of our debt solutions professionals will work with you to assess your financial situation and recommend the best option for settling your debt. If a consumer proposal is your ideal solution, your debt solutions professional will analyze your income and expenses in detail and estimate a payment amount based on your financial situation. The first appointment is always free, confidential, and judgment-free.

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Step 2

We’ll prepare the necessary documents for your proposal

During the next step, we’ll prepare the necessary documents needed to submit a formal offer to your creditors to settle your unsecured debt, which you’ll review beforehand. At this stage, we may ask you to provide additional documentation to confirm your creditors, debt owed, and/or your income.

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Step 3

Review and sign your consumer proposal with your LIT

Once you’ve reviewed and signed your consumer proposal, your LIT will file the proposal with the Office of the Superintendent of Bankruptcy Canada (OSB). 

After filing your proposal, you‘ll stop making payments directly to your creditors, collection calls will stop, and creditors can no longer garnish your wages or take legal action against you for your debt.

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Step 4

Receive a voting decision from your creditors

Your creditors have 45 days from the filing date of your proposal to either approve or reject the terms. Typically, creditors will agree to the terms because, in a proposal, you’ll repay more of what’s owed to them, compared to bankruptcy.  

However, if your creditors are unhappy with the proposal, your LIT may renegotiate the terms. The majority of your creditors must accept the terms of your proposal for it to be approved. If they reject your proposal, our debt solutions professionals will explore other options with you.

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Step 5

Complete your repayments and other responsibilities

Once your proposal is signed, you’ll be required to make either a lump sum or monthly payment to your LIT, who will repay your creditors on your behalf. 

You‘ll have up to five years to repay your debt; however, you can pay off the outstanding balance at any time and complete the process early. 

You also must attend two financial counselling sessions and meet any other conditions in the proposal.

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Step 6

Begin your financial fresh start

Once you’ve completed the proposal terms, you can start rebuilding your credit and living debt-free.

Take the first step to debt freedom

Speak to one of our debt solutions professionals during a free, no-obligation consultation.

You can count on us!

LITs are the only federally regulated debt professionals qualified to offer solutions such as bankruptcies and consumer proposals. When you choose a LIT, you can be assured that you’re dealing with someone who‘s proven they have the knowledge, experience, and skills to help you make an informed decision about your finances.

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