Consumer Proposal

Consumer Proposal

What is a consumer proposal?

The consumer proposal is an alternative to bankruptcy. This solution consists of submitting an offer to your creditors to reduce your payments and reimburse them based on your financial capacity. If the proposal is accepted, you will be discharged of all your unsecured debts once you have met your commitments.

Only a licensed insolvency trustee (LIT) can act as administrator of a consumer proposal. You will be guided by a professional at each step until you regain your financial freedom.


How does a consumer proposal work?

Remboursement - Dettes

Development of a settlement offer, subject to the approval of your creditors.

Paiement par mois

Only one monthly payment to make, directly to the Licensed Insolvency Trustee.

Cible - objectif

Released from the debts included in the consumer proposal upon meeting all the conditions.

Understand the consumer proposal

Preliminary meeting with the trustee

The trustee tabulates your financial situation, first by analyzing your income and assets. Then, he or she lists your debts and determines your capacity to pay them, taking into account your budget and daily expenses. If a consumer proposal appears to be a good way to settle your debts, the licensed insolvency trustee will recommend it as a solution.


Day 1

The trustee presents an offer to pay to your creditors. This offer will take into account your needs and capacity to pay.


Days 1 to 45

After 45 days, the consumer proposal administrator must call a meeting of creditors if creditors representing 25% of the value of claims request one. If no request for a meeting is made, or if the percentage is less than 25%, the proposal is deemed accepted by all creditors.


Meeting of creditors

At a meeting of creditors, the majority of creditors, representing 50%+1 of the number of votes received by the trustee, must accept the consumer proposal for it to be accepted.


When the consumer proposal is accepted

If it is accepted, the agreement negotiated under the consumer proposal can continue for a period not exceeding 60 months. Interest no longer accumulates and you now have only one monthly payment to make, directly to the trustee.

If the consumer proposal is refused, your licensed insolvency trustee will guide you to another solution to settle your debts and help you with the process.


Debt discharge

Once the required payments have been made, you are discharged of your unsecured debts even if the amount reimbursed is less than the initial amount.


Advantages of the consumer proposal

  • Simplifies your debt management.

  • Reduces the total amount of debt you have to reimburse.

  • Stops interest accumulation.

  • Ends collection action by your creditors.

  • Protects you against certain legal proceedings, including garnishment.

  • Subject to creditors approval, the amount of your payment is set according to your budget.

  • Flexible payback period, can be as long as 60 months.

  • The fees of a LIT are established under the BIA and are included in the monthly payments of your proposal.

  • Allows you to avoid bankruptcy.

Is a consumer proposal the right solution for you?

The consumer proposal is a solution for your debts if you are facing one or more of the following problems:

  • 1

    You are making your payments late.

  • 2

    Your creditors have started collection action.

  • 3

    Your salary has been seized.

  • 4

    You are concerned about your debt level.

  • 5

    You want to get out of your debt problem, despite your financial difficulties.

  • 6

    You want to avoid bankruptcy.

Start fresh thanks to the consumer proposal

Once your debts have been discharged and the consumer proposal completed, you can rebuild your credit rating by adopting sound financial management practices.

The consumer proposal will appear in your credit file for a period of three years after you’ve made your final payment. However, you can work on improving your reputation with financial institutions.

For example, you can continue to reimburse your secured debt within the expected terms and pay your bills on time. What is important is to maintain a good financial situation and leave your financial problems behind you.


Ginsberg Gingras, your debt solution.

If you are losing control of your financial situation and you are thinking seriously about a consumer proposal, our Licensed Insolvency Trustees (LIT) can advise you.

As professionals, they can help you throughout your efforts to end your financial difficulties. They’ll ensure your interests will be respected and will be sure to keep you well informed about each step.

Contact us for a free, confidential evaluation without any obligation on your part.

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Información para los consumidores sobre el procedimiento de insolvencia.
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