Top Ten Questions About Consumer Proposals

A consumer proposal can be an extremely reliable way to help you clear some of your debts.

In fact, it can provide relief for up to 80% of all your debt and the remaining 20% can be paid off over several years.

So here are ten common questions that we get asked about consumer proposals to help you understand more.

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1. Does a consumer proposal differ from bankruptcy?


A bankruptcy seizes your assets and clears all of your unsecured debts.

A consumer proposal differs in that it doesn’t completely wipe your debts but does give you more freedom to keep your assets.

2. How much of my debt can I clear?

You can clear up to around 80% of your debt and the remainder can be paid off interest-free over a period that is suitable for you.

3. Will my assets be safe?


Unlike bankruptcy, you can opt to keep your assets or sell them to shorten the repayment term.

4. Does a consumer proposal affect my spouse?


However, if your debts are shared then you can file a joint proposal with your spouse.

Otherwise, it will not affect your spouse.

5. Will my wages be affected?


An advantage of a consumer proposal is that it actually stops any potential wage garnishment as soon as it has been filed.

6. Does a consumer proposal affect my credit?

If your credit rating was high before filing the proposal then it will drop.

However, if you’re already facing a poor credit rating, you likely won’t be affected much.

Your credit can easily be repaired after filing a consumer proposal and it doesn’t leave a mark on your credit for several years like a bankruptcy.

7. How long is the repayment period?

This will depend on the consumer proposal that your trustee has negotiated.

This can be up to five years but can be negotiated with help from your trustee.

8. What happens if I can’t make my consumer proposal payments?

If you fall behind by three payments then the consumer proposal is annulled and creditors can chase you for the original amount owed plus interest.

It’s important to stay up-to-date with your payments to avoid this, so speak to your trustee to ensure the repayment terms are suitable for your circumstances.

9. What if my income situation changes?

You have no obligation to report changes to your living situation.

Additional income is yours to keep, but you may want to let your trustee know if you fear you’re unable to make payments.

10. Who do I contact to learn more about consumer proposals?

You’ll need to contact a licensed insolvency trustee who will guide you through the process of filing a consumer proposal.

They will also be responsible for negotiating the consumer proposal.

If you’d like to learn more about consumer proposals, don’t hesitate to get in touch with us today for more information.

Information on Consumer Proposals

Consumer Proposals in Canada – An Alternative to Bankruptcy
What is a Consumer Proposal?
What are the Benefits of a Consumer Proposal?
What are the Steps in a Proposal?
What Debts Are Erased in a Consumer Proposal?
Is There Life After a Proposal?
Consumer Proposal Eligibility
How to Amend a Consumer Proposal

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