Debt Management Programs vs Consumer Proposals

Debt

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Debt Management Programs

One of the options available to people in Ontario who are unable to pay off their unsecured debt, is the Debt Management Program – a service overseen by non-profit, professional credit counsellors.

With a Debt Management Program, the credit councillor contacts the unsecured creditors in an effort to have them agree to reduce or stop charging interest on outstanding balances, with the understanding that the debtor (person who owes the debt) will repay the entire amount owing over a set period of time.

Since a Debt Management Program is not a legally binding agreement, those creditors who choose to ignore the offer are free to continue their collection efforts.

There is no charge for the Debt Management Program – however, depending on the applicant’s financial situation they may be asked to make a contribution.

Consumer Proposals

Covered by the Bankruptcy and Insolvency Act, Consumer Proposals are legally-binding agreements between debtors and their unsecured creditors. Administered by licensed Bankruptcy Trustees, Consumer Proposals usually result in settlements that are for less than total amount owing.

If the Trustee and applicant agree, a Proposal is drawn up and registered with the Office of the Superintendent of Bankruptcy. The Trustee then contacts the applicant’s creditors who vote on the Proposal. Once a Consumer Proposal is accepted by the majority of the unsecured creditors, all unsecured creditors must honour the terms of the Proposal. This means that all the unsecured creditors must then:

  • Stop all legal collection action.
  • Remove garnishees.
  • Stop all collection efforts.
  • Stop all interest charges.

Proposals cannot run for more than five years.

There are charges for using the services of a Bankruptcy Trustee, however they are taken into consideration when the Proposal payments are calculated, ensuring that the total monthly cost (including debt repayment) is reasonable and often substantially less than would be paid out on a Debt Management Program.

Which is the Best Option For You?

Obviously, we believe strongly in Consumer Proposals – we are Licensed Bankruptcy Trustees who have helped thousands of people in the Greater Toronto Area through the Proposal process. However, we also believe in the need for people in financial difficulty to get as much information as they can, to ensure they make the best decision for their needs – which is why we offer a free initial consultation to explore all available options.

If you are in the Greater Toronto Area and find yourself overwhelmed by debt, contact the caring professionals at David Sklar & Associates. Call 416-498-9200 and book your free consultation today.

 

Take Your First Step Towards A Debt Free Life

If you are overwhelmed by debt, call us at 1-844-962-9200 to book a FREE, confidential appointment. We will review your financial situation in detail and discuss all of your options with you. Alternatively, you can fill out the form below and our team will reach out to you. 

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The team at David Sklar and Associates Inc are very professional and are willing to help you get out of debt. Highly recommended.
Melissa MacKenzie
12:35 29 Mar 23
I would like to thank the team at David Sklar and associates inc. for all the time and effort they put in to support this process for me. This topic can be challenging to disclose but a big thank you to Christine for going above and beyond in guiding me through all my options and supporting me through the decisions. I cannot recommend this group enough , as they have shown me compassion , knowledge , and understanding throughout the entire process. I look forward to the next step of this process and learning how the proper way of becoming financially educated through the support of their financial counselling team. For anyone who is struggling , just know that there is a wonderful group of educated professionals at David Sklar who are available to help!
Michelle Plouffe
18:45 14 Mar 23
It took me awhile to get up the courage to contact David Sklar but I’m so glad I did. Trina walked through my options with me and provided the knowledge I needed to make a decision to help turn my financial situation around. She is patient and empathetic and answered any and every question that I had. Trina provided me the reassurance I needed that I was making the best decisions for me and my family. I’m so happy that I reached out and now have a plan to get back on track.
M. Mackenzie
19:59 12 Mar 23
Trina was very helpful and thorough.
Sam M
15:26 12 Mar 23
Christine was very helpful, kind, and understanding. She explained everything thoroughly, answered any questions I had, and was responsive to any concerns I had. 100% would recommend
Katherine Campbell
17:29 08 Mar 23
Jackie Stanley is excellent she took the time to explain everything to me and I am so grateful to her for giving me a fresh financial start so if you have any doubts don’t and go see her if you want to achieve financial freedom!
Heather Helfield
21:24 06 Mar 23
Amazing friendly staff that knows what they are going. They make a difficult situation not so bad. Would give 10 stars if I could.
alie Balan
22:37 25 Feb 23
Very helpful and kind and gave me all the available options before helping me decide which one was best for me. I would definitely recommend Jackie
Alison Rivard
01:01 21 Feb 23
Great experience i was in financial trouble and someone of my friends recommended this company. Cori is a wonderful and welcoming person she did a very good job and came up with a smooth and flexible monthly payment after the reduction. i highly recommend this company. Thank you David sklar and special thanks to Cori.❤️🙏🏻
Jasmine Joseph
22:08 13 Jan 23
Met up with Mr. Jason Sklar to discuss more in person, very thorough and clear. He is very kind and thoughtful, I will be referring anyone with the same situation to David Sklar & Associates.
Ariel Domingo
02:33 29 Dec 22
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