OUR PROPOSAL ADMINISTRATORS GUIDE YOU THROUGH CONSUMER PROPOSALS

A consumer proposal is an offer to your creditors stating you will pay them a certain amount of money over a five year period or less. This amount is less than what was agreed on at the beginning of the contract or loan. The consumer proposal is a formal agreement that is prepared and filed under the Bankruptcy and Insolvency Act by one of our Proposal Administrators in the GTA at Yanch Dey & Associates Ltd.

After you file a consumer proposal:

  • Collection companies and creditors will stop calling you about your debts
  • Any wage garnishments will be stopped
  • No further interest will be applied to any debts you owe

After the consumer proposal is prepared and submitted on your behalf, the trustee then contacts the creditors you owe to inform them that you’ve filed a consumer proposal.

At this point, the creditors have 45 days to request a meeting of creditors. If there is no requirement for a meeting, your proposal is deemed to be accepted. If there is a request for a meeting, your creditors will then vote on whether or not to accept the proposal. If the majority of your creditors vote to accept your proposal, it’s binding on them all.

WHAT DO I LOSE IN A CONSUMER PROPOSAL?

If your consumer proposal is granted you make payments directly to the Proposal Administrators. Usually the amount you have to pay will be 50% to 70% less than the amount you owed before doing the proposal.

WHAT DO I PAY IN A CONSUMER PROPOSAL?

Owners of sole proprietorships or partnerships are responsible for the debts of the business and the personal assets of themselves and their partners. The assets of the business and the owner’s personal assets are grouped together. This becomes a personal bankruptcy.

An incorporated business gives a small business owner a liability protection. In this case, a bankruptcy would not affect them personally.

WHAT DEBTS DOES A CONSUMER PROPOSAL COVER?

Consumer Proposals cover debts that are considered to be unsecured, such as:

  • Credit card debts
  • Lines of credit that are not secured
  • Personal loans to individuals like family and friends
  • Overdrafts on bank accounts
  • Income tax debt

or more information about consumer proposals and financial debt issues, contact Yanch Dey & Associates Ltd. There is no charge to discuss your case.

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Have a bankruptcy, consumer proposal or financial issue you'd like to discuss? Send us and email and we respond within four (4) hours.