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Consumer Proposal Toronto

A great alternative to bankruptcy and a popular choice in Toronto!

What is Consumer Proposal?

Consumer Proposal is an alternative to a bankruptcy in Toronto. It is a debt relief option which is a legally binding, negotiated debt settlement which allows you to make an offer to your unsecured creditors to settle the amount owed to them. The amount to be paid back is based on your income, assets, and total debt load. A Licensed Insolvency Trustee is required in order to act as a consumer proposal Administrator and is authorized to arrange and administer. This repayment schedule will provide for a reduction in the total amount owing, usually ranging from 50% to 75%. The time in which to pay back varies and can be no longer than a maximum of five years. Once a consumer proposal is accepted by the creditors it is a legally binding contract between you and your unsecured creditors.

Listen to this quick video about Consumer Proposal in Toronto.

Consumer Proposal FAQ's

How will it help me?

Once you file a consumer proposal in Toronto, all interest charges, collection calls, wage garnishments and any legal action will stop. Since a Licensed Insolvency Trustee will act on your behalf, you do not need to contact or deal with your unsecured creditors directly.

What will happen to my credit rating?

The filing of a consumer proposal remains on the credit report for three years from when the terms of the proposal are completed.  A benefit of a consumer proposal is that you can complete the terms sooner than initially agreed upon, which would reduce the length of time it appears on your credit report. Even though it is on your credit report, our qualified counsellors will discuss with you the necessary steps to take in order for you to rebuild your credit history.

Am I eligible to make a consumer proposal?

As long as you owe less than $250,000 (this amount would exclude the mortgage on your home) you would be able to file a consumer proposal.

Should you owe more than $250,000, you would be required to file a Division 1 Proposal, which is another proceeding but the same concept as the consumer proposal.

What are my duties when filing a consumer proposal?

  • Attend two mandatory counselling sessions within the required time frame;

  • Make the required monthly payments;

  • Keep your Licensed Insolvency Trustee informed of your current address and other contact information.

Can one file a consumer proposal if I have declared bankruptcy already?

Yes, Section66.11 of the Act sets out the eligibility for one to file a consumer proposal considering specific criteria that are required to meet the section of the act. “Consumer Debtor” is best described as an individual who is bankrupt or insolvent and whose debts excluding debts related to one principal residence, may not exceed $250,000.

This may be considered if after you have declared bankruptcy and your financial situation has changed.  As an example, if you get a new job after declaring bankruptcy and your income increases instead of income decreases the result is that you may have a surplus income and could see yourself as being liable for much higher payments.  Moving to a consumer proposal will reduce the monthly payment by extending the repayment schedule and thus making the payments far more manageable. This also is in the interest of the creditors as you will repay a larger portion of your debt.

Can I file for Consumer Proposal Outside Toronto?

Yes.  While we handle many cased for Consumer Proposal in Toronto, we handle just as many cases outside of Toronto and across the province of Ontario.

How do I get started?

Contact us at 1-844-482-3328 to book an initial meeting to review your monthly income and expenses, your debt load and your assets. We will explain all of your duties and responsibilities. We are here for you throughout the entire process. When meeting with one of our experienced Licensed Insolvency Trustees they will make sure that the monthly amount being paid back is suitable and manageable to your financial situation.

We pride ourselves in being committed to making sure that each individual client understands the consumer proposal Toronto process. We want you to ask all the questions that are concerning you.

Are all my debts eliminated when I file?

In most cases all unsecured debt will be eliminated by a consumer proposal, including Canada Revenue Agency debt. However, there are various debts that would not be eliminated and you would be responsible to maintain the payments. These debts would normally be any fine, penalty or restitution order made by the court, parking or speeding tickets, spousal or child support, any award for damages in respect of an assault, and student loans that are less than seven years old since your last study date.

What happens to my house, vehicle, RRSPs, RESPs ?

Once you file a consumer proposal, you will be able to maintain your home, car, and other assets that are important to you and your family. In order to determine your monthly payment the Licensed Insolvency Trustee will need to evaluate the value of your assets

Can one file a consumer proposal with another person?

We often find ourselves with debts that are shared with a partner or another person. It is not unusual to jointly be responsible for a co-signing or guaranteeing of a loan.  This usually occurs with individuals that find themselves in a relationship.  This relationship can be as simple as a couple, individuals living together and married coupled.

As a couple or more than one person can file for a consumer proposal together, this is commonly referred to as a Joint Filing. In order to be eligible for a joint filing, a substantial amount must be similar.  For example, if a couple file as a joint filing the total debts must be less than $500,000 this does exclude a mortgage on their principal residence.  The difference is that it is not limited to $250,000 for a single individual

What is a Licensed Insolvency Trustee?

A Licensed Insolvency Trustee is the only professional authorized to administer government-regulated insolvency proceedings that allow you to be discharged from your debt, such as a consumer proposal or a bankruptcy.

When dealing with Sheriff Sole & Madej Inc. you can be confident that you are working with a company that has demonstrated that they have the knowledge, experience and skills to be granted a license from the Office of the Superintendent of Bankruptcy.

Expert Consumer Proposal Help in Toronto

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How is a Consumer Proposal Different than Bankruptcy?

The Office of the Superintendent of Bankruptcy in recent years reported a significant decrease in bankruptcy filings due to a steady increase in consumer proposal submissions as recently. As 2015 almost 50% of all insolvency instances where in fact filed as consumer proposals.

A greater awareness within the consumer market around potential new solutions, when having to deal with their financial woes, has led to an increase in questions around the benefits of consumer proposal versus bankruptcy.

As each situation is unique it is imperative that one recognizes that one size fits all does not always apply in today’s complex financial world. The days of taking the drastic action of declaring bankruptcy and recognizing that this is a serious solution one avoid bankruptcy as the repercussions affect your financial record for six years, and if this is your second filing up to 14 years.

9 Reasons why a consumer proposal filing could be better than bankruptcy:

1.    Creditor Protection: A consumer proposal inevitably protects you from creditors. Trustee files your proposal with all your creditors, your personal assets cannot be seized and wages, if they are being garnished, will stop. With bankruptcy, it does result in your assets being seized based on your allowable exceptions. One must note that each province has specific exceptions.

2.    The process: of a Proposal: Notwithstanding the inherent costs around bankruptcy, a consumer proposal is less complicated and easier to navigate and complete. The level of legal complexity and mandatory documentation along with a depth of regulations is higher in bankruptcy. Thus, the less restrictive consumer proposal allows for the administration through a License Insolvency Trustee. Upon submitting a proposal to your creditors, they have 45 days to accept or decline the conditions. The creditors may request a meeting and amendments can be made to your initial proposal. This again must be done with your insolvency trustee.

3.    Credit Rating: is if you are questioning the difference between a consumer proposal and bankruptcy quite often the reality is your credit rating is already negatively affected and in some cases because of lack of payment and collections quite close to zero. There is however a difference with regards to time that bankruptcy versus consumer proposal remains on your credit bureau score. Upon paying the agreed upon terms of a consumer proposal the credit bureau keeps a record for three years, however, with bankruptcy, it remains there for six years.

4.    Assets: the number one reason why most Canadians of which file for a consumer proposal relates to their individual assets. One gets to keep all their assets most significant is your home. Most households, families, couples will avoid any solution as best as possible that may result in one losing their home.

5.    Avoid Bankruptcy: the stigma of bankruptcy for most individuals is something one avoids to their best ability. For some consumers, it can be more critical as it may adversely affect their business, legal requirements and professional designation.

6.    Instant Financial Improvement: Once a consumer proposal is approved by your creditors the terms of the proposal are legal and binding and you can move on to financial recovery. If you acquire a new job and your salary increases, sell any of your assets, tax refund, or an annual bonus, that revenue is yours to keep. You will never be asked or required to pay more money.

7.    Cost: the only costs associated with a consumer proposal are your fees to your License Insolvency Trustee who completes and submits the filing in its entirety and in addition ensures payment to your creditors to repay your debt. There are no filing fees, administration fees, consulting fees paid independently.

8.    Qualification: In in order to qualify and be a candidate for a consumer proposal and you are unable to pay your debts and you find that you have unsecured debt greater than $1000 and less than $250,000 (this will exclude your mortgage debt) if you have the ability to repay a portion of your debt, and your creditors agree to your proposal, you are a strong candidate for a consumer proposal.

9.    Manageable Payments: If you have a consistent and reliable income source you will qualify for a consumer proposal. There are no predefined standards that dictate how much one pays. Each scenario is unique and will usually relate back to a percentage of your unsecured debt.

Comparison of solutions available to you:


Reduce Your Debt

A consumer proposal is a debt relief option which allows individual to consolidate their debts into one monthly interest free payment. It is a legal binding process between you and your creditors to repay a portion of what is owed. A Licensed Insolvency Trustee will negotiate with the creditors on your behalf to reduce the amount of debt owed. The amount of debt to be repaid is based on your income, assets and total debt load.


Restructure Your Debts

The debt consolidation loan option allows you to combine your debts into one loan with a lower interest rate. This option is available through a bank or a financial institution. In this option you would pay off the amount owing to your creditors in full while getting a new single monthly loan payment.  Debt consolidation however will only reduce your interest payment and your overall amount owing is not reduced or eliminated.


Eliminate Your Debt

A Bankruptcy is a legal process that can be filed through a Licensed Insolvency Trustee. It is another debt relief option that can help individuals deal with their financial problems.  In general, if you debt load is very high, your income is limited and you have no assets or minimal assets, then the bankruptcy option is likely the best course of action to follow.



Credit counselling is an option where you would be able to meet with one of our certified credit counsellors to discuss your fixed living expenses and required monthly bill payments.  We would discuss strategies and techniques to help you better manage your monthly financial plan. This option does not reduce or eliminate your debt.

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