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Who is Eligible for a Consumer Proposal in Canada?

When it seems like there is no way out of debt, it may be intimidating and distressing. A consumer proposal could be a good alternative if you're in debt trouble and trying to find a solution. A consumer proposal is a legally binding agreement outlining a repayment schedule for your debts between you and your creditors. It might assist you in getting your finances back on track and is an alternative to declaring bankruptcy.

So who qualifies for a consumer proposal in Canada, and what requirements must they meet? We'll talk about the qualifications for a consumer proposal in this article, along with how it might aid in debt relief.

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What is a Consumer Proposal?

Let’s first define a consumer proposal before moving on to the requirements for eligibility. You can negotiate a settlement with your creditors through a legal procedure known as a consumer proposal under the Bankruptcy and Insolvency Act. The settlement is frequently less than the entire amount you owe and is determined by your ability to pay.

By filing a consumer proposal, you are effectively informing your creditors that you are unable to pay your debts in full but would like to provide a fair settlement instead. Together with you, your LIT will draft a plan that is reasonable for both you and your creditors.

You will be obliged to pay your LIT on a regular basis over time if your creditors approve your plan (usually up to five years). These payments will be distributed to your creditors by your LIT. Your remaining debts will be dismissed once you have completed all necessary payments, and you will be debt-free (with the exception of any debts that are not included in the proposal, such as student loans or child support payments).

 

Eligibility Criteria for a Consumer Proposal

So, in Canada, who qualifies for a consumer proposal? The eligibility criteria for a consumer proposal are fairly straightforward:

  1. You must be a Canadian resident.
  2. Over $10,000 must be owed (not including your mortgage).
  3. You must have a reliable revenue source that enables you to make the necessary payments.
  4. You must not have already declared bankruptcy.

If you meet these criteria, you are most likely eligible to submit a consumer proposal. It is important to keep in mind nonetheless that not all debts are eligible for inclusion in a consumer proposal. Secured debts (such as a vehicle loan or a mortgage), student loans with a maturity date of fewer than seven years, and any court fines or penalties are excluded from the debt calculation.

 

How a Consumer Proposal Can Help You Get Out of Debt?

Now that we’ve discussed who qualifies for a consumer proposal, let’s look at how it can help you get out of debt.

 🢖 It can help you pay off debt:

When you submit a consumer proposal, you are effectively settling with your creditors. You might be able to settle your debts for less than what you owe because of this. For instance, you might be able to settle for $25,000 if your credit card debt totals $50,000.

 🢖 It can stop legal action and collection calls:

When you submit a consumer proposal, your creditors are legally obligated to halt any legal action and collection calls. This may provide you with the much-needed break from the pressure and worry that comes with having to deal with debt collectors.

 🢖 It can protect your assets:

When you submit a consumer proposal, your possessions are protected from creditors’ claims. Hence, you can maintain your house, car, and other valuable assets.

 🢖 It can assist you in avoiding bankruptcy:

If bankruptcy is something you are contemplating as a solution to your financial problems, a consumer proposal could be a better choice. A bankruptcy has detrimental long-term effects, including a negative effect on your credit score. You might be able to prevent these repercussions by making a consumer suggestion.

 🢖 It can help you start over:

Your remaining debts will be discharged after your consumer proposal is finished and all mandatory payments have been made. Hence, you will be debt-free (except any debts that were not included in the proposal).

 

 

Let Us Help You Achieve Debt Relief

A consumer proposal might be an effective way to get your finances back on track if you are dealing with debt and fulfill the qualifying requirements. You might be able to settle your debts for less than what you owe, cease collection calls and legal action, safeguard your assets, and stay out of bankruptcy by reaching a settlement with your creditors based on what you can afford to pay.

We at National Debt Relief are aware of the daunting and stressful nature of dealing with debt. In order to identify the best answer for your particular situation, our experts can assist you in exploring your options, including consumer proposals. To find out more about how we can help you achieve debt relief and financial freedom, get in touch with us right away. Call us at (1-800-300-9550)

We are a team of expert debt specialists that provide FREE CONSULTATION to our clients. 

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Jennifer Chenier
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I was lost ... single mom... off due to Covid for 3 months .. did what it took to pay bills and look after my kids... and left with nothing but a tonne of debt I could not keep up with 😢. And then ....I met Connie.. Connie gave me my life back. The entire experience was like talking to my mother. She was full of compassion and knowledge and took me under her wing for this entire process. She turned tears into smiles and hope . She reassured me.. and made me feel like it was Going to be ok. I can’t thank her and the team (Paul) enough for helping me through this . I highly recommend National Debt Services to anyone looking for help with their debt . Start living again ❤️. Thanks Connie Jen
Katherina Preston
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"So glad I finally had the courage to make the call" Suma was amazing.. she guided me through my options and got the answers to all my questions. By the end of our very first phone conversation I had hope again...finally...no more sleepless nights worrying my debt ....Thank you National Debt Relief Services
Chris V
Chris V
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I would just like to thank Suma for really making feel comfortable throughout this entire process. Everyone tells you to watch out for gimmicks, quick fixes, and everything else that comes with Debt. Ive had other companies who had made promises and under delivered. However Suma and her team are quick to provide the right answers and guide everyone in a way towards better credit. She has made it seamless with great communication and availability. I have personally referred her to several of my closest friends and i would recommend her to anyone else looking for consolidation.
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Top 5 Key Benefits of our Ontario Debt Relief Program:

To know more what you can benefit from our Ontario Debt Relief Program, simply try our Debt Consolidation Calculator below and one of our debt specialists will get in touch with you and provide you the best debt relief option that fits your situation.

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We will help you reduce as much as 75% of your debts and consolidate it into a single affordable monthly payment. Your creditors will stop harassing you and all interest will freeze if you get into our Ontario Government Debt Relief Program.

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Find out how much you can write off portion of your debts by getting your Free Savings Estimate below. A debt specialist from National Debt Relief Services in Ontario will discuss all options and provide you tailor-fitted Debt Relief Program.

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Frequently Asked Questions

A Debt Consolidation is a negotiated debt settlement offer made between you and your creditors with the help of a Debt Relief Agency in Ontario. Some key benefits of Debt Consolidation are interest-free program, no upfront fee required, combined monthly payment into one affordable amount, no lawsuits, and many more.

Yes, your assets are safe from creditors. A licensed debt relief agency in Ontario will help you come up with an offer to your creditors that will make sure your assets will be out of the paper.

No, in fact, this is one of the great advantages of a Debt Consolidation Program. All wage garnishment will stop from the day you filed the proposal.

The effect on your credit score is not going to be severe. Your credit score will most probably go to R7 Rating and will remain in your credit report for another 3 years after you completed the program. This means that it will not be permanent and you will still be able to rebuild your credit score.

 

This varies depending on the proposal you will be discussing with the help of a certified debt relief agency. It is also worth noting that debt consolidation cannot exceed more than 5 years.

If a debt is shared, you need to file a joint debt consolidation offer to your creditors. However, in most cases, in which the debts are individually incurred will have no impact on your spouse.

After three missed payments, your debt arrangement with creditors will be broken and you will end up getting chased again for the original debt amount plus interest.

A debt consolidation offer can be paid off earlier if you can. In this way, you receive your “Certificate of Completion” sooner and you can immediately start rebuilding your credit score. 

National Debt Relief Services Ontariois a certified Canadian Debt Relief Agency that offers FREE CONSULTATION to your debt consolidation needs. We value the trust given to us by our clients by making sure your personal information is confidential and private. Our personalized plans are designed to tailor fit your financial capacity. Our specialists will get in touch with you by simply answering a few questions thru the link provided below.

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Dawn Friesman
Dawn Friesman
20/09/2020
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I've been working with Allicia Macdonald shes very professional and sweet. I cant thank her enough for helping me rebuild my life. Thank you so much.
Chantal Rolfe
Chantal Rolfe
18/09/2020
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Today I had a wonderful experience with Rachael, she was Very professional I was very happy with what we talked about today she was very Caring I highly recommend national debt relief services hundred percent😃
Jennifer Magill
Jennifer Magill
18/09/2020
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Brittany was awesome, she explained everything clearly and offered solutions every step of the way. It’s always nice to hear that you could do this or that, I didn’t feel forced to do anything and was able to decide clearly. Thank you 🙏🏼
Dave Tonnos
Dave Tonnos
18/09/2020
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This company will work with you and through any difficulties that may arise. They actually hold themselves accountable, how refreshing during troubling economic times.
marian kamara
marian kamara
18/09/2020
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I have a great experience working with Suma, she work me through the program, takes her time to explain everything to me about how the program work, what I need to do from start to end of the process. I’m so thankful to God for sending an angel Suma to help relief my debt. It’s a great company to work with. I will recommend this program for anyone in debt like me.
Donna Hutchings
Donna Hutchings
18/09/2020
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Connie B. was absolutely awesome! She explained everything in detail to me. Very professional to work with and takes the time with you. She really has compassion. So glad she helped me out. Thank you
lynn collins
lynn collins
18/09/2020
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Joel has made this so simple and effortless he made sure i was well informed and making the right decisions for my situation i would recommend joel at national dept Relief to anyone in hardship with there bills thanks alot joel i really appreciate everything you have done for me thanks!! 5 stars for sure! and its chad ball not my mom lynn lol
Billy Bong
Billy Bong
17/09/2020
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I had a great experience with Brittany, so helpful and understanding. Never felt like I was being pressured or rushed into anything. She was always there with answers to my questions. Thanks for all the help and peace of mind you helped me achieve.
Amber-lyn Miller
Amber-lyn Miller
17/09/2020
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Let’s Just Put It Simple....... Not All Hero's Wear Caps........I spoke with Suma over a fairly lengthy period of time because of my busy schedule and lack of free time on my part, and she was not only extremely patient and understanding, but also beyond helpful And informative. Any question I had and no matter how many times she had to explain it to me she took her time to make sure I completely understood every single step and process before she moved on to the next thing. I have been so stressed out and worked up about my debt and trying to figure out how to fix it all since I know I will not be returning to work at all in the future because of medical issues and being 26 with that realization makes things just that more stressful but Suma made everything so easy and my payments are $100 a month for less then 5 years with no interest or penalties for early pay off. I’m so glad that I didn’t settle with some other place that was asking for $350 + a month for 7-12 years and paying off early would cost you more.
Jessica Preston
Jessica Preston
17/09/2020
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Caroline F. was phenomenal, she was so helpful, understanding and compassionate. Caroline did not make me feel bad for my mistakes, she was supportive and caring, she helped me through this dark time in my life I'm so incredibly happy I crossed paths with her. Thank you Caroline for being so wonderful to me! <3

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