In a consumer proposal, an administrator works with you to develop a proposal to:
- reduce your debt
- stop further accumulation of interest
- stop collection calls and garnishees of wages
- renegotiate the loan and payments
This legal process is authorized by the Canadian government under the authority of the Office of the Superintendent of Bankruptcy and must be set up by a proposal administrator (Licensed Insolvency Trustee).
Once prepared the insolvency trustee presents the proposal to the creditors (the people you owe money to) and explains that you cannot pay the amount owed and are seeking to renegotiate the amount of debt and payment terms.