If you are insolvent, you may be able to file a Consumer Proposal. However, in order to file a Consumer Proposal your total debts, excluding the mortgage on your principal residence, must not exceed $250,000 as outlined by the Bankruptcy and Insolvency Act. For more details, visit our Are You Eligible for a Consumer Proposal page.

When it comes to costs involved in filing a Consumer Proposal, there are a couple of important points. First, costs are federally regulated and prescribed by a tariff contained in insolvency legislation. Second, all costs associated with filing a Consumer Proposal are paid from the Consumer Proposal funds, so the consumer is not billed for costs at any time during the Consumer Proposal. In effect, the Consumer Proposal funding covers administration...

There are certain debts that survive a Consumer Proposal filing as outlined in Section 178 of the Bankruptcy and Insolvency Act . These include: Court fines, penalties and restitution orders Alimony, child support and maintenance Any award by the Court for intentional bodily harm, sexual assault or wrongful death Any debt or liability arising out of fraud, embezzlement, misappropriation or misconduct while acting in a fiduciary...

At the time of filing a proposal you will generally be required to turn over all your credit cards to your Licensed Insolvency Trustee. You may not be able to obtain a new credit card until after your proposal term is complete. However, you can usually continue to use or obtain a prepaid or secured credit card during your proposal.

As you do not typically give up your assets in a proposal, you will continue to be responsible to file your annual Income Tax returns. Any eligible tax refunds for years before the proposal will continue to be sent to you by Canada Revenue Agency, unless you have other tax debts owing to them. Any tax debt arising in the tax years prior to the proposal year will be included as a creditor in the proposal. For the year of the proposal and future years...

When you file a proposal, unsecured creditors deal directly with your Licensed Insolvency Trustee. Unsecured creditors must stop contacting you directly. If an unsecured creditor persists in contacting you, notify your Licensed Insolvency Trustee immediately.

No, filing a Consumer Proposal will have no affect on your job. Section 66.36 of the Bankruptcy and Insolvency Act states that, “No employer shall dismiss, suspend, lay off or otherwise discipline a consumer debtor on the sole ground that a consumer proposal has been filed in respect of a consumer debtor.”

Normally, secured creditors are not affected by a proposal. In most instances, you will continue to make payments to the secured creditors as per your usual arrangements. However, in your proposal you may choose to surrender and return your secured assets and stop making payments to secured creditors. In these circumstances, any resulting shortfall that may arise from the sale of the asset held as security by the secured creditor will be included...

A consumer proposal cannot last more than five years, but the exact length depends on the type of proposal you submit. Your credit rating reflects this for three years after your final payment.

A Consumer Proposal is for individuals whose debts have become unmanageable, but are still able to make some form of payment to creditors. With revisions to their payment plans they will be able to pay back their unsecured debts partially or in full within a maximum term of five years.