Consumer Proposal
A structured alternative to bankruptcy — and what it means for your financial future.
Entering into a consumer proposal is the ideal step before bankruptcy. It's designed for people who have steady income but can't keep up with full repayments — and want a structured way to settle their debts without going through bankruptcy.
In its simplest form, a consumer proposal is an arrangement you reach with your creditors with the mediation of a trustee. You sign a legal contract and are immediately protected from debt collectors, and you also agree to a partial repayment of the unsecured debts you owe — with your creditors agreeing to forgive the balance.
The Process
How a consumer proposal works
A consumer proposal is a formal, legally binding process administered by a Licensed Insolvency Trustee — giving you a clear path to resolve unsecured debt.
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1
Meet with a Licensed Insolvency Trustee
A trustee works with you to assess your situation and determine whether a consumer proposal is the right path forward.
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2
Develop your proposal
Together, you create an offer to pay creditors a percentage of what is owed, extend the time you have to pay, or both. The term cannot exceed five years.
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3
File and gain protection
Once filed, you stop making payments directly to unsecured creditors. Wage garnishments and lawsuits are halted while creditors review your proposal.
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4
Creditors vote
Creditors have 45 days to accept or reject the proposal. If accepted, you follow the agreed repayment plan and work toward becoming debt-free.
Moving forward after a proposal
Completing a consumer proposal can be a turning point. With the right plan, many Canadians go on to rebuild their credit and qualify for financing again. At The Approval Centre, we help people understand their options and take practical steps toward financial stability.
Explore your options with us
Our team can help you understand what comes next and how to work toward approval.