Consumer Proposals

In Canada, Consumer Proposals are a legal solution designed by the Federal Government to help to those with substantial consumer debt. The primary characteristics of Consumer Proposals include:

• Debt reduction benefit: You to pay back just 30% (or less) of your total debt in a Consumer Proposal, effectively cutting your overall debt down by as much as 70%.

• Affordable payments: Consumer proposals span across 1 to 5 years, with monthly payments geared to what you can afford.

• No additional fees:  Once the consumer proposal is agreed upon, creditors cannot add interest costs, late penalties or any other fees.

• Legally Binding: the consumer proposal is legal agreement administered through an Insolvency Trustee. Once your creditors greenlight your proposal, it becomes a legally binding agreement between you and your creditors.

• Avoids Bankruptcy: Proposals help many consumers keep personal possessions and the severe credit repercussions of filing for bankruptcy.

Simply put, Consumer Proposals allow those with high consumer debt e.g. credit card debt,  to reduce the amount owed, with affordable payments spaced over a 1 to 5 year period.  At the end of a consumer proposal you’re completely out of debt.

John, a 35-year-old Canadian, has found himself under a considerable pile of debt.

He owes $50,000 in credit card debt and has personal loans amounting to $30,000. Unable to manage his monthly payments, he’s now dealing with persistent collection calls and legal threats from his creditors.

He decides to explore Consumer Proposals, consulting a licensed insolvency trustee. Together, they develop a proposal for his creditors, which includes:

• five-year payment plan
• manageable monthly payment of $400.
• interest, penalties & additional charges are stopped

Once this proposal is negotiated and agreed upon, it becomes a legally binding agreement. John is now committed to making the agreed payments, while his creditors are barred from taking any further legal action against him.

In John’s case, his total debt was $80,000. However, with the Consumer Proposal, he is set to pay approximately $24,000, reducing his overall debt by a whopping 70%.

Keep in mind that this is merely an illustrative example. The specifics of a Consumer Proposal can vary based on an individual’s circumstances and the agreement reached with their creditors.

Consumer proposals are a solution where you’re struggling with overwhelming debt. A proposal allows you to keep your assets, protect your paycheque, and become debt-free in five years or less? A Consumer Proposal may be the answer for you!

Consumer proposals are a debt relief option that can offer many benefits, including:

• keeping all of your assets
• stops wage garnishments
• stops legal collections
• becoming debt-free in five years or less
• saves you thousands of dollars

In a consumer proposal, outstanding debts and credit card bills can be reduced by 70% or more. This means that you can have a fresh start and put financial worries behind you. Additionally, interest, fees, and garnishments are stopped, allowing you to keep more of your hard-earned money. With a Consumer Proposal, you can keep all of your belongings and move forward with a new perspective on your finances.

Don’t let overwhelming debt control your life any longer. A Consumer Proposal may be the solution you’ve been looking for. Speak to one of our Licensed Insolvency Trustees at no cost or obligation.

In a consumer proposal, outstanding debts and credit card bills can be reduced 70% or more. Interest, fees and garnishments are stopped. You keep all of your belongings.

Consumer proposals in Canada offer several advantages to individuals who are struggling with debt. These include:

• Legal protection from creditors: Once a consumer proposal is filed, creditors are legally prohibited from taking any action to collect the debt.
• Debt reduction: Consumer proposals allow individuals to pay back a portion of their debt, rather than the full amount.
• Interest freeze: Interest on the debt is frozen once a consumer proposal is filed, meaning that the amount of debt will not increase while the proposal is in effect.
• One affordable monthly payment: Instead of multiple payments to multiple creditors, a consumer proposal allows individuals to make one affordable monthly payment.
• Avoids bankruptcy: Filing a consumer proposal allows individuals to avoid bankruptcy and its negative consequences, such as damage to credit rating and potential loss of assets.
• Keep assets: Consumer proposals allows you to keep your assets such as house and car if you can keep up with the agreed payment plan.

Consumer proposals are administered by a Licensed Insolvency Trustee (LIT) who provides guides you throughout the process.

★★★★★ The interest and payments just kept on going up, then the collection calls started.  My friend told my about YanchDey, I called and spoke to Kelly who explained how she could help with a consumer proposal.  We saved over $30,000, we now pay $250/month and will be debt free in 5 years! Andrea R. Oshawa

Consumer proposals are a debt relief program available to individuals who meet the following:

• Residents of Canada with unsecured debt of less than $250,000 (not including mortgages on their principal residence)
• Financially insolvent, meaning that their debts are greater than their assets and they are unable to pay their debts as they become due.
• Have a source of income
• Must not have filed a consumer proposal or bankruptcy in the last six years.

It is important to note that certain types of debt, like student loans and taxes, may not be eligible for inclusion in a consumer proposal.

Starting a Consumer Proposal begins with a simple phone call to our office. Once you call, you’ll speak directly with an insolvency trustee.

The trustee will want to review your bills, expenses, and income. With this information, the trustee will then formulate a financial plan focused on repaying only a “percentage of the total amount you owe.” The monthly payments are carefully calculated based on what you can realistically afford, considering both your income and expenses.

A Consumer Proposal starts off by putting you on the path to reduced debt, setting up manageable and affordable payments that make sense for your financial situation.

Consumer Proposals come with a range of advantages that can offer you a fresh financial start. Here are three compelling reasons to consider this option:

A Fresh Start: A Consumer Proposal allows you to reset financially, providing a new beginning free from the weight of debt.

Significant Debt Reduction: This program can cut your debts and payments by as much as 70%, offering you substantial financial relief.

Become Debt-Free Quickly: With a Consumer Proposal, you have the potential to be debt-free in as little as five years, allowing you to live your life without the constant stress of overwhelming debt.

At Yanch Dey understand that navigating the complexities of a Consumer Proposal can be daunting. That’s why we are committed to supporting you throughout the entire process.

From handling paperwork to explaining every step, we’re here to guide you. You’re not alone on this financial journey; we’ll be with you every step of the way.

Don’t hesitate—take the first step toward a brighter financial future with a Consumer Proposal and call us today!

★★★★★ My husband was laid off, but our bills kept coming, we were drowning in debt. The consumer proposal solved our money problems and saved us $18,000. We will be debt free in four years, Thank you Susan N. Oshawa

Consumer Proposals are a legal arrangement designed to help individuals manage their debts. Here are key points to know:

• Legal Agreement: It’s a legally binding process governed by the Bankruptcy and Insolvency Act of Canada.
• Alternative to Bankruptcy: It serves as an alternative to declaring bankruptcy.
• Licensed Administrator: You must work with a Licensed Insolvency Trustee to file a Consumer Proposal.
• Unsecured Debts: It generally covers unsecured debts like credit cards, personal loans, and certain tax debts.
• Proposal to Creditors: You offer to pay creditors a percentage of what is owed to them over a specific time period.
• Creditor Voting: Creditors have the option to accept or reject the proposal; acceptance requires approval by creditors representing at least 50% of the debt value.
• Interest Freeze: Once accepted, interest on your debts generally stops accruing.
• Asset Protection: Unlike bankruptcy, you usually get to keep all your assets.
• Monthly Payments: You will make monthly payments to the Licensed Insolvency Trustee, who will distribute these funds to your creditors.
• Credit Rating Impact: A Consumer Proposal will affect your credit rating but is generally considered less severe than a bankruptcy.
• Duration: Typically, a Consumer Proposal lasts up to 5 years, but it can be paid off sooner.
• Completion Certificate: After successfully completing all payments, you will receive a certificate of full performance, relieving you from the debts included in the proposal.
• Exclusions: Not all debts can be included; for example, secured debts like a mortgage usually can’t be included.
• Costs: There are fees involved, but these are usually included in the monthly payments and regulated by government tariff.
• Eligibility: You must be insolvent (i.e., unable to meet debts as they become due), have debts not exceeding a certain threshold, and meet other criteria to qualify.
• Record Removal: A Consumer Proposal will stay on your credit report for three years after completion, affecting your ability to get new credit during that time.

Understanding each of these aspects can help you determine if a Consumer Proposal is the right debt solution for you. Call and speak to our friendly Insolvency Trustees to discuss your situation and how we can help you..

In a consumer proposal you’ll be debt free in 3-5 years.

Once filed, you are covered by consumer protection. Consumer protection means, creditors (including credit card companies & people owed money) must stop all collection actions against you.

This includes harassing calls, garnishments and lawsuits.

★★★★★ We spoke to a consumer credit counseling agency that recommended YanchDey. Our personal loans plus my student-loan debt left us with little at the end of the month.  The proposal was the best debt management program for us, paying off our debts in 5 years.  We’re even saving money now to make a lump sum payment! Thank you NameWithheld, Oshawa.

Consumer Proposal Ontario | Consumer Proposals