In a consumer proposal a stay of proceedings takes effect the moment the proposal is filed, and creditors must stop charging interest immediately.
When you work with our trustees, this protection starts on day one, giving you instant financial breathing room and a clear path forward.
The stay of proceedings is the legal rule that forces creditors to stop all interest, penalties, and collection activity as soon as your proposal is submitted. Creditors cannot add charges, increase your balance, or continue enforcement.
How Interest Stops in a Consumer Proposal with a Stay of Proceedings
This gives you a clean slate moving forward.
Many people assume interest continues until approval, but it doesn’t. The moment the proposal is filed, all interest stops—even before creditors vote.
This applies to bank loans, credit cards, tax debt, lines of credit, payday loans, and collections. The balance freezes, protecting you from further growth.
Creditors often add late fees, compounding charges, or penalty interest when accounts fall behind. The stay prevents this. Whether you owe a small amount or tens of thousands, the balance is locked at the filing date. For most people, this is the moment their debt finally stops growing.
In addition to stopping interest, a consumer proposal usually reduces the principal to about 30% of your original debt. Once the interest freeze is applied, the trustees from Yanch Dey calculate a new payment that fits your budget and stays fixed for the entire term.
This stability is one of the biggest advantages of the process.
Once the stay takes effect, collection agencies must stop calling.
Lawsuits, wage garnishments, and bank freezes also stop immediately. Even aggressive collectors must follow these rules, and they cannot contact you or add new charges to your account.
The Bankruptcy and Insolvency Act gives consumer proposals their legal power. Creditors who violate the stay face penalties and legal consequences.
This ensures fairness, and it guarantees that your proposal moves forward without new financial pressure.
This consumer proposal calculator shows an approximate of how much you could save.
If you’re feeling overwhelmed by debt and not sure where to start, the best thing you can do is talk to someone who understands.
Call now and speak directly with me — Kelly Dey — for clear, honest advice that’s tailored to your situation. There’s no pressure and no judgment. We’ll look at your options together and create a plan that helps you breathe again. Getting started is easier than you think, and one simple conversation can put you back in control of your money and your life.
Let’s take that first step today, call 905-721-7506.
A. Interest stops the moment your consumer proposal is filed—not after approval, not after the vote, and not when payments begin.
Creditors are legally required to freeze your balance instantly. This prevents your debt from growing while the proposal moves forward.
A.Yes. All unsecured debt interest must stop. This includes credit cards, lines of credit, loans, collection accounts, overdrafts, and even CRA penalties. Once the stay is active, creditors cannot add charges or fees of any kind.
A. No. Even if adjustments are requested, the balance remains frozen. The process continues without additional charges until the final structure is agreed upon. Our trustees handle these adjustments, keeping everything predictable and stress-free.
A. Absolutely. The stay forces garnishments, lawsuits, and frozen accounts to stop immediately. Employers and banks must comply as soon as they receive notice from your trustee.
A. No. Once the proposal is fully paid, the remaining balance is legally discharged. Creditors cannot collect the forgiven portion, and they cannot restart interest on any discharged debt.
Insolvency Trustee – Kelly Dey
If you’re feeling weighed down by money or debt issues, give me a call at 905-721-7506 and lets just have conversation.
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Megan R.
3 days ago
★★★★★ I was shocked to see interest stop the moment we filed. My balance froze instantly, and the stress dropped right away.
Daniel S.
1 week ago
★★★★★ The team explained the stay of proceedings so clearly. No more interest, no more late charges—everything stopped.
Linda P.
2 weeks ago
★★★★★ I thought interest would continue until approval. It didn’t. My debt finally froze and stopped growing.
Omar A.
3 weeks ago
★★★★★ Everything was explained upfront. The interest freeze saved me thousands over the life of the proposal.
Caroline B.
1 month ago
★★★★★ They stopped the interest and the calls immediately. I finally felt like I could breathe again.
Rise Above Your Debt!
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