Consumer Proposal & Bankruptcy Trustee in Ajax, Ontario

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Selecting the Right Debt Solutions Professional in Ajax, Ontario

Many Canadians feel the heavy debt burdens, often from economic challenges or unforeseen life events. The Consumer Proposal is an attractive alternative to address your financial obligations in the face of options such as debt consolidation, with its total debt repayment requirement, and bankruptcy, which may entail the forfeiture of valuable assets.



What is a Consumer Proposal?

A Consumer Proposal is a federally regulated, legally binding process overseen by the Office of the Superintendent of Bankruptcy. It offers an alternative to personal bankruptcy and is exclusively administered by a Licensed Insolvency Trustee. Repayment amounts are primarily influenced by your income and assets, with the substantial advantage of potentially alleviating unsecured debt by up to 80%.

The Licensed Insolvency Trustee will assess your financial standing and design a monthly payment aligned with your financial capacity. Once presented to your unsecured creditors, acceptance of the proposal renders the agreement legally binding. While the Consumer Proposal allows a maximum repayment period of five years, you retain the flexibility to settle it earlier. Immediate cessation of legal actions, such as wage garnishments and intrusive calls from collection agencies, happens upon submission.

Beyond significant debt reduction, a Consumer Proposal can yield reduced monthly payments, cessation of interest charges, and consolidating unsecured debts into a singular monthly payment.

What Debts are Included in a Consumer Proposal?

A Consumer Proposal encompasses most unsecured debts, including various types not secured by assets such as a house or car. Typically, the following can be included:

  • Credit card debt
  • Personal loans, including lines of credit, consolidation, or renovation loans, provided no assets secure the debt.
  • Payday loans
  • Student loans if you ceased to be a student at least seven years ago
  • Income tax debt, encompassing amounts owed for personal income tax (including penalties and interest), GST debts, Canada Child Benefits overpayments, CPP, and OAS overpayments.


Is a Consumer Proposal the Right Option for Me?

Consider a Consumer Proposal if:

  • Your debt is less than $250,000, excluding your principal residence’s mortgage.
  • You are insolvent and unable to meet monthly obligations.
  • Relief from wage garnishments, collection calls, and accruing interest is sought.
  • Assets need protection not safeguarded in bankruptcy.

Alternatives to Consumer Proposal

Given the array of debt relief options, a thorough evaluation is crucial to determine the best solution for your financial circumstances.


Bankruptcy, also overseen by a Licensed Insolvency Trustee, involves assigning a trustee to manage your case. This trustee takes control of your assets (with exceptions), oversees your affairs, and supervises your bankruptcy obligations, including mandatory credit counselling sessions and monthly income and expense reporting. Upon fulfilling these duties, you attain debt discharge after either 9 or 21 months.

Debt Management Plan (DMP)

In a DMP, a non-profit credit counsellor assesses your debts and crafts a multi-year repayment plan spanning three to five years. The proposed plan is presented to your creditors, and upon acceptance, you make a single monthly payment to the credit counselling agency. The credit counsellor may negotiate a reduced interest on your debt, redirecting the savings toward debt repayment.

It’s crucial to note that a DMP does not involve debt reduction or cancellation; you must still settle your entire debt. Importantly, this distinction sets it apart from a consumer proposal.

Consolidation Loan

A debt consolidation loan combines multiple small loans or debts into a new single loan. This service achieves various goals, such as paying off smaller debts or consolidating higher-interest debts into a single payment with a lower interest rate spread over an extended period.

However, it is essential to understand that this approach does not eliminate your debt but makes it more manageable. Moreover, eligibility for a consolidation loan requires an application and qualification process.

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See What Your Debt Repayments Might Look Like

Our debt calculator provides a comparison of what your monthly debt repayment might look like under different debt relief options including a debt consolidation loan, debt management plan and consumer proposal



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