Consumer Proposals in BC

Are you living in British Columbia and are struggling with your finances?

A Consumer Proposal in BC can help you get your debts under control.

No matter where you live in the province, whether it’s Vancouver, Victoria, Kamloops or another area, it’s time to look for a solution to your debt.

Debt in the province is ever-increasing, so there’s no better time than now to look for a way to consolidate your debts.

And one of these options that you might come across is a consumer proposal.

A popular option for those seeking debt relief, it’s a legally binding process that’s governed through Canada’s Bankruptcy and Insolvency Act.

With this option, there are, however, certain eligibility requirements that you need to align with to be able to file a consumer proposal.

These include, but are not limited to the following:


  • You’ll have to have debts below $250,000 to qualify.
  • You must be insolvent (i.e you must owe more in repayments than you own).
  • You must have a stable income so that you can efficiently repay your creditors the agreed monthly amount.
  • You must be a resident of Canada or be a Canadian homeowner.


What is a Consumer Proposal? 

A consumer proposal is a legal agreement which is made directly between you (the debtor) and your creditor.

Arranged by a Licensed Insolvency Trustee, it details the exact amount that you have to repay each month to your creditors.

Taking into account how much you can realistically afford to repay and the assets you own, it’s an agreement that’s designed to satisfy both your requirements and that of the creditors in question.

An alternative to personal bankruptcy that can be very effective in the long term, it’s created with flexibility so that you can successfully repay the debt within a maximum of 5 years.

If you’re on the hunt for further advice about consumer proposals in BC or you’re looking to discover what other debt relief options may be suitable for your unique needs, it’s a good idea to get in contact with a Licensed Insolvency Trustee that’s based in BC.

Luckily, at Bankruptcy Canada, we’ve partnered with experienced and skilled trustees throughout British Columbia that will help you with the process and guide you as to the specific steps it entails.

Find out more today by calling (877) 879-4770 or by filling out the online form

The cost of consumer proposals in BC 

When filing for a consumer proposal, you may think that the process is free.

However, it will cost you – therefore, it’s important that you budget ahead of time to ensure that you can cover it.

The process of setting up a proposal will cost you approximately $1,500.

Set up by the trustee, once the setup fee is paid, the proposal can be sent off to your creditors for them to look over.

There is a 45 day period in which they can accept or reject the proposal.

If they accept it, you’ll have up to a maximum of 5 years to repay the debt in full and you’ll have to cover the remaining balance.

As well as the cost of setup, it’s important that you pay attention to the trustee fee.

This will be approximately 20% of your monthly repayments.

Known as an administration fee, it’s one that many people often forget about when filing a proposal.

The key benefits and downsides of consumer proposals in BC

Before filing a consumer proposal in BC, it’s essential that you pay attention to the key benefits and downsides that come with it.

To help with this, here is a brief list of the pros and cons that you can take advantage of:

Let’s start with the benefits:


  • It will consolidate all of your debt into one affordable repayment each month.
  • It stops any wage garnishments you have.
  • It will prevent creditors from directly harassing you.
  • It pauses any collections of payments – i.e student loan repayments.
  • No interest rates are applied to the repayment.
  • You’ll only repay a percentage of what you owe.
  • An effective alternative to either a debt consolidation loan or management program – it’s therefore ideal for those who don’t qualify for them.
  • You are able to keep your assets (unlike filing for bankruptcy).
  • You can avoid bankruptcy.


Now, onto the downsides of consumer proposals in BC


  • If you miss more than 2 repayments, you may have to file for bankruptcy.
  • You have to wait 45 days for the creditors to accept it.
  • The Office of the Superintendent of Bankruptcy must approve it.
  • The student loan debt has to be over 7 years old.
  • The process can be costly, making it not affordable for everyone.
  • It has an effect on your credit report.
  • If you’re unable to make the repayments, you might need to sell some of your high-ticket assets (e.g your home or car) to help cover them.
  • It only applies to unsecured debt.


What type of debt can consumer proposals cover?

Consumer proposals aren’t suitable for everyone.

That’s why it’s important when looking at this option, that you note the types of debt that it can help with.

Many people don’t realize that it’s only suitable for unsecured debts and that secured debts aren’t factored in.

However, despite this, it can be effective at assisting with the following types of unsecured debts, that are very common:


  • Payday and bank loans.
  • Credit card, student loan and tax debt.


When should you consider consumer proposals in BC?

Alongside the specific debts that it can help with, there are certain situations when it can be a good choice.

Of course, your trustee will further guide you with this, but to give you an insight, here are a few examples:


  • You have a stable income and are therefore able to successfully make each payment.
  • You are looking for an alternative to filing for bankruptcy.
  • You’re looking for an affordable and personalized solution to your financial struggle.


Harassment you should be aware of surrounding consumer proposals in BC

As with all debt relief options available in Canada, there are certain issues that you should be aware of.

And when it comes to consumer proposals, there is a possibility of being ripped off and misled by illegitimate companies.

Only a licensed trustee can file your consumer proposal for you.

So even if you’re tempted into a for-profit agency because they seem cheaper, they aren’t legally allowed to carry out the process.

Instead, opt for a trustee that has the experience and qualifications to file it for you.

You don’t want to be ripped off and for your financial situation to be affected even more.

Therefore, it’s a good idea to contact a BC-based trustee to discuss your financial situation.

Alongside this, you should make sure that you:


  • Read through the terms thoroughly before you sign.
  • Read customer testimonials and uncover the experience that they have.
  • Avoid any for-profit consultants that claim to work solely on commission.

The impact it can have on your credit report 

As aforementioned, a consumer proposal can have an impact on your credit report and rating.

But to what degree is this?

A common question that people have, it’s a vital element to consider and understand.

Once your consumer proposal is filed with the superintendent, you’ll have to start repairing your debts.

The date that this begins will be put on your credit report within the public records area.

This note can be accessed by anyone that has permission to do so.

As well as this note, you may receive an R7 credit rating.

Reported by your creditors, it showcases that you’re repaying the debt through a third party – your licensed trustee.

When your repayments come to an end, it will state that it’s complete on your report.

This report could have an effect on future loans or on your employment as it shows that you had a repayment plan in place.

However, if you’ve successfully completed it and you budgeted effectively, you’ll be able to rebuild your credit rating in as little as 2 years.

Guiding BC residents with debt relief advice for over 20 years

Since 1999, Bankruptcy Canada has been guiding BC residents on debt relief solutions.

From filing for bankruptcy to consumer proposals, credit counselling and more, our expert advice has helped thousands of people.

This, along with the advice given by our partnered trustees could be invaluable to helping you to regain your financial stability.

No matter what your financial situation, whether you’re in a debt cycle or have a specific type of debt (e.g student loan or tax debt) our advice could help you to gain a new financial start.

Personalized to your needs, you needn’t look any further for financial guidance.

A licensed insolvency trustee can help you with filing a consumer proposal.

When you make a proposal to your creditors you are prosing to pay a certain monthly payment to your creditors in exchange for forgiveness of the debt included in the proposal agreement.

Declaring bankruptcy is also a possibility, but a proposal offers many advantages over going bankrupt.

If you are looking for a debt settlement plan, a consumer proposal can help you get out of debt.

Find out more today 

Do you want to find out what debt relief solution works for you?

Then contact one of our BC licensed trustees today.

Guiding you through consumer proposals in BC along with your other options, they are with you from start to finish.

Call one of our partnered experts today on (877) 879-4770 or drop them an email to discover more.

In BC, a licensed insolvency trustee will help you with making a consumer proposal to your creditors, although they will be acting as your proposal administrator.

As a popular alternative to declaring bankruptcy, a proposal allows you to make a plan to make a monthly payment to your creditors for a certain period of time to become debt free.

Under your proposal plan, you will only repay a portion of the debt you owe, and there is no interest charged on your debts throughout the entirety of your proposal.

Debt included in a proposal can be credit card debt, tax debt, unsecured lines of credit, and other unsecured debts.

As a debt settlement arrangement, a debt proposal offers many advantages for the consumer struggling with debt.

Consumer Proposals Across British Columbia, BC

North Vancouver