Consumer Proposal

File your consumer proposal through a Licensed Insolvency Trustee. It is a viable restructuring option for over 45,000 Canadians a year, allowing the consumer to seek legal protection from their creditors under a Federal Statute (Bankruptcy and Insolvency Act) whereby a debtor usually only repays a portion of what they owe interest-free.

Read our guide to consumer proposals and debt consolidation

Highlights

• Payback a percentage of what you owe without interest or penalty
• The repayment period is up to 60 months
• The repayment amount is based on your budget and ability to pay

Consumer Proposal Benefits

• Most wage garnishments cease immediately
• Interest stops accumulating from the day the consumer proposal is filed
• Collection agencies and creditors can no longer contact you
• Consumer proposals do less damage on your credit bureau rating than a bankruptcy by reporting as a "7" instead of a 9. So it is easier and quicker to start rebuilding your credit

Through this process, a debtor is required to give "full disclosure" of all their assets, liabilities, income and expenses, as well as business interest as part of the process.

Additional Information

• You must be insolvent to file a consumer proposal (debts are more than assets)
• Your creditors are required to vote on the consumer proposal
• A consumer proposal is an alternative to Bankruptcy
• You cannot pick and choose the debts that are included (all debts must be included)
• You cannot eliminate support or alimony obligations
• You cannot eliminate student loans under seven years old
• You cannot include secured debts such as mortgage and car loans
• You are allowed to keep assets based on Provincial legislation

4 Pillars works with the debtor to fully understand all options to deal with debt and how each option fits with their budget.