LCTaylor: Filing a Consumer Proposal in Canada


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Am I eligible for a consumer proposal? Do my creditors have to accept a consumer proposal? LCTaylor provides answers to the most frequently asked questions about consumer proposals in Canada.

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LCTaylor: Filing a Consumer Proposal in Canada

  1. 1. Filing a Consumer Proposal in Canada
  2. 2. What is a Consumer Proposal? It’s a proposal made by debtors, facilitated by bankruptcy trustees, to modify their payments to creditors. Such a proposal must be completed within five years.LCTaylor: 1.800.463.8371
  3. 3. Most Frequently Asked Questions About Consumer Proposals in CanadaLCTaylor: 1.800.463.8371
  4. 4. 1. What is the first step for filing a consumer proposal? Meeting with a licensed bankruptcy trustee is the first step. Your trustee will conduct a complete review of your finances to use as the basis for submitting a proposal to your creditors.LCTaylor: 1.800.463.8371
  5. 5. Am I eligible for a consumer proposal? In order to file for a consumer proposal you must meet the following criteria: -Be insolvent -Have total debt less than $250,000 (excluding your home mortgage) -Have a steady source of incomeLCTaylor: 1.800.463.8371
  6. 6. Do my creditors have to accept my proposal? Creditors do not have to accept your proposal but usually will if they stand to receive more than if you file for bankruptcy. If a majority of your creditors vote to accept the proposal, all unsecured creditors in the proposal become bound by it. If a proposal is rejected, you can meet with your creditors, determine why it was rejected and resubmit it.LCTaylor: 1.800.463.8371
  7. 7. What are the terms of a consumer proposal? • The terms of a proposal are based on your personal finances and your ability to pay. • You will need to make monthly payments as outlined in the proposal. • Attendance at two financial counselling sessions is required to complete your proposal.LCTaylor: 1.800.463.8371
  8. 8. When will my consumer proposal be complete? A consumer proposal needs to be completed over a pre-determined amount of time of no more than five years. If you meet the criteria as outlined in your proposal terms, you will complete your agreement. Note: Section 178 debts will survive a proposal.LCTaylor: 1.800.463.8371
  9. 9. Why should I file a consumer proposal? • Consumer Proposals provide legal protection from your creditors • You can retain your assets • You can pay back a reduced amount of your overall debtLCTaylor: 1.800.463.8371
  10. 10. For more information about filing a consumer proposal in Manitoba or Ontario visit Trustees are available to answer your questions at our Winnipeg and Kenora locations.LCTaylor: 1.800.463.8371