A Credit Card Company is Taking Me to Court – Is it too Late to File a Consumer Proposal?

Filing a Consumer Proposal After Being Sued by a Credit Card Company

Credit card debt is a common issue that many people face. When this debt becomes unmanageable, creditors may resort to legal action. If you’re in this situation, you might wonder: Is it too late to file a consumer proposal? The short answer is, it’s never too late.


A consumer proposal is a legal procedure in which you make an offer to your creditors to pay off a percentage of your debt, extend the time you have to pay off the debt, or a combination of both. It’s a way to avoid bankruptcy and minimize the impact on your credit score.

Legal Action by Creditors: The Process

Understanding the process of legal action by creditors can provide some peace of mind. It’s important to remember that receiving court papers is just the first step in the legal process. Creditors cannot immediately start garnishing your wages – they must follow a legal process.

Step 1: Statement of Claim

The first step in this legal process is the issuance of a statement of claim. This document shows the amount you owe and notifies you that legal action has been initiated. Upon receiving the statement of claim, you have 20 days to file a defence.

Step 2: Default Judgement

If you do not defend the action within the 20 day period, the creditor can obtain a default judgement against you. This is a court order that allows your creditor to garnish your wages.

Filing a Consumer Proposal: The Benefits

Filing a consumer proposal has several benefits that can protect you from the consequences of legal action.

Stopping Interest

A consumer proposal can halt all interest on your debts, preventing them from growing further.

Halting Legal or Collection Action

Once you file a consumer proposal, any ongoing legal or collection actions are stopped. This includes wage garnishment.

Compromising Your Debts

A consumer proposal allows you to negotiate the terms of your debt repayment. You may be able to pay a portion of your debts, extend the repayment period, or both.

It’s Never Too Late

Even if a creditor has obtained a judgement against you, filing a consumer proposal can still stop them. It’s never too late to file a consumer proposal, but it’s crucial to act promptly to protect your wages and assets.


If a credit card company is taking you to court, don’t panic. While it’s a serious situation, there are options available to you. Filing a consumer proposal is a viable option, providing a way to manage your debt and protect yourself from further legal action. It’s never too late to take control of your financial future.

Contact a financial advisor or a licensed insolvency trustee to explore your options and determine if a consumer proposal is the right solution for you. Remember, every situation is unique, so it’s important to get advice tailored to your specific circumstances.

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