Consumer Proposals

• What is a consumer proposal?
• A consumer proposal is an offer made by a debtor to unsecured creditors. The offer might be comprised of lower payments over a longer period of time. In some cases, this provides a good alternative to bankruptcy given the right circumstances.
• What is the benefit of a proposal?
• If a proposal is accepted, interest stops accumulating, no legal action can proceed (i.e. - asset siezure and wage garnishment) and the creditors would realize more of the debt than through a bankruptcy.
• What about a car loan?
• A proposal only deals with unsecured creditors. All secured loans remain in place and the debtor must continue to make the normal monthly payments.
• Who can make a consumer proposal?
• Anyone who is insolvent and whose total debt is less than $250,000, excluding a mortgage on their personal residence.
• How can I file a consumer proposal?
• Firstly, one would have to meet with a financial counsellor at Harris & Partners Inc. to have their situation assessed. If the conditions of that person's financial situation are suitable, the counsellor would recommend that a consumer proposal be filed.
  
  Once this option is chosen, the Trustee will prepare the necessary documents, have them signed by the debtor and submit them to the Official Receiver. At this point, the creditors would be notified and have the right to vote for or against the proposal.
  
  Once the proposal is accepted, the terms of the proposal will have to be fulfilled. When all of the payments have been made, you will be discharged of the remaining debt of the proposal.

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