How Much Does a Consumer Proposal Cost in Ontario?
One affordable payment, no upfront fees
If you are considering a consumer proposal, one of the first questions you likely have is how much it costs. The good news is that consumer proposals are designed to be affordable, predictable, and based on what you can realistically pay.
This page explains how consumer proposal costs work in Ontario, what factors affect the monthly payment, and what to expect before you commit.
What Is a Consumer Proposal and Who Pays for It
A consumer proposal is a formal debt solution administered by a Licensed Insolvency Trustee. It allows you to repay a portion of your unsecured debt over time while stopping interest and collection activity.
You do not pay separate legal or government fees upfront. All costs, including trustee fees, are built directly into the monthly payment agreed to in your proposal. This makes the process transparent and easy to manage.
How Much Does a Consumer Proposal Cost in Ontario?
There is no fixed cost for a consumer proposal. The total amount you repay depends on your financial situation and what your creditors agree to accept.
In general, a consumer proposal costs less than the total amount of debt you owe and is structured as one monthly payment over a set period, up to a maximum of five years.
Your Licensed Insolvency Trustee works with you to propose an amount that fits your budget while offering creditors a fair alternative to bankruptcy.
Initial Consultation and Assessment
The first step is a FREE, confidential consultation with a Licensed Insolvency Trustee.
During this meeting, your trustee reviews:
- Your total debt
- Your income and household expenses
- Your assets
- Your financial goals
There is no cost for this consultation, and no obligation to proceed. The goal is to determine whether a consumer proposal is appropriate and what a reasonable payment might look like.
Licensed Insolvency Trustee Fees
Licensed Insolvency Trustee fees are regulated and included in your consumer proposal payments. You do not pay them separately.
This means:
- No surprise charges
- No upfront trustee fees
- No hourly billing
Your monthly payment covers both creditor repayment and trustee administration costs, all under federal oversight.
Monthly Consumer Proposal Payments Explained
Your consumer proposal payment is based on what you can afford, not a fixed formula.
Factors that influence the monthly amount include:
- Total unsecured debt
- Income and household size
- Living expenses
- *What creditors would recover in a bankruptcy
Once your proposal is accepted, the payment amount is fixed and does not change, even if your income increases.
Are There Any Government or Filing Fees
There are no additional government filing fees you need to pay separately.
All required filings with the Office of the Superintendent of Bankruptcy are handled by your Licensed Insolvency Trustee and included in the proposal structure.
What Affects the Cost of a Consumer Proposal
Every consumer proposal is different. Common factors that affect the cost include:
- The total amount of debt owed
- Your monthly income
- Your ability to make regular payments
- Whether you own assets
- Your alternatives if you filed bankruptcy
Your trustee explains how these factors apply to your situation before anything is filed.
Consumer Proposal Cost vs Bankruptcy Cost
Many people compare the cost of a consumer proposal to bankruptcy before deciding.
Consumer Proposal
Personal Bankruptcy
Monthly Payment
Fixed and agreed in advance
Based on income
Interest Charges
Stopped
Stopped
Payment Changes
No
Possible
Total Cost
Often lower for higher income earners
Can increase with surplus income
Asset Protection
Typically retained
Some assets may be affected
A Licensed Insolvency Trustee can explain which option makes more financial sense based on your circumstances.
Consumer Proposal Payment Example
What Could a Consumer Proposal Payment Look Like?
A consumer proposal is a formal debt settlement, not a loan. It can work like debt consolidation by combining included unsecured debts into one affordable monthly payment, but without borrowing more money.
Your actual proposal payment depends on your income, expenses, assets, debts, and what your creditors are willing to accept. The example below is not meant to be a quote and is only meant to illustrate how different debt solution options may compare.
$250 per month
Based on a sample repayment of $15,000 paid over 60 months with no interest on included debts. This is 30% of the $50,000 and the rest is forgiven at the end of the proposal.
- Sample repayment amount: $15,000
- Interest rate used: 0%
- Payment term used: 60 months
- No new loan required
$1,189 per month
Based on repaying the full $50,000 balance over 60 months with a sample 15% annual interest rate.
- Loan amount used: $50,000
- Interest rate used: 15%
- Payment term used: 60 months
- Full balance must be repaid
$1,500 starting payment
Based on a starting minimum payment of 3% of the $50,000 balance and a sample 20.99% annual credit card interest rate.
- Balance used: $50,000
- Minimum payment used: 3%
- Interest rate used: 20.99%
- Interest may continue to add up
Use the Calculator Below for a More Personalized Estimate
The above example is meant to provide a simple side-by-side comparison and is not meant to be a quote. Your actual consumer proposal payment may be higher or lower, so use the calculator below to explore what your monthly payment could look like based on your financial situation.
This example and the Calculator are for illustration purposes only and are not a guarantee of what proposal amount the Trustee may recommend or what the creditors will accept. The consumer proposal example uses a sample repayment amount of $15,000, which is 30% of the $50,000 unsecured debt example, paid over 60 months with no interest on included debts. Actual consumer proposal payments may be higher or lower and depend on your actual income, expenses, assets, debts, and overall financial situation. The above debt consolidation loan calculation uses a sample 15% annual interest rate over 60 months. Actual interest rates on consolidation loans may be more or less than estimated. The Credit card minimum payment calculations use a sample 3% starting minimum payment and 20.99% annual interest rate. Actual rates, payments, terms, and creditor outcomes may vary considerably. A Licensed Insolvency Trustee can review your situation and explain what options may be available
Calculate savings
Consumer Proposal - 0% Interest
Debt Consolidation Loan - 30% Interest
Do Nothing - 19% Interest
* Calculations above are made over a 5 year period at a rate of 80% savings. This calculator provides an estimate of the total savings you may receive when filing a consumer proposal. Actual results may vary. Your payments will depend on your income, assets, and debts.
What happens if your financial circumstances change?
If your financial situation improves while completing your consumer proposal, you can increase your monthly payment amount to finish your proposal sooner.
Alternatively, let’s say your finances deteriorate, and your income suddenly dries up. In that case, you will need to assess whether this is a short-term issue or longer term. if it will be longer term, you will want to ensure that you do not fall into arrears on your payments as the third payment arrear will result in your consumer proposal being annulled. As a result, you’ll now be responsible for repaying your debts as they existed before you filed the proposal. Your creditors can also pursue legal action against you, including garnishing your wages.
Suppose you anticipate falling behind on your monthly payment for the third time. In that case, your Licensed Insolvency Trustee can help you negotiate new payment terms with your creditors. If accepted, you can resume your monthly payments under the revised terms.
The Biggest Advantages of a Consumer Proposal?
In this video, Richard Sklar, a Licensed Insolvency Trustee at David Sklar & Associates in Ontario, Canada, explains the top 5 benefits of filing a consumer proposal.
Consumer proposals are interest-free and there are no additional costs that you need to make aside from your monthly consumer proposal payment.
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Frequently Asked Questions About
Consumer Proposal Cost
How much does a consumer proposal cost in Ontario?
There is no fixed monthly cost for a consumer proposal. Your payment depends on how much unsecured debt you owe, your income, your assets, your monthly budget, and what your creditors are willing to accept.
Many consumer proposals are paid monthly over a period of up to 5 years. Once your proposal is accepted, your payment is fixed, which can make it easier to budget.
Are there upfront fees for a consumer proposal?
No. You do not pay a separate upfront fee to file a consumer proposal with a Licensed Insolvency Trustee. The trustee fees are included in the proposal payments you make.
This means you make one agreed monthly payment, and the Licensed Insolvency Trustee distributes funds to creditors according to the proposal terms.
What's included in the consumer proposal cost?
Your consumer proposal payment includes the administration of your file by a Licensed Insolvency Trustee, communication with creditors, required paperwork, creditor voting, payment distribution, and the two mandatory financial counselling sessions.
You do not pay a separate trustee bill on top of your accepted proposal payment.
Can I pay off my consumer proposal early?
Yes. A consumer proposal can last up to 5 years, but you can pay it off early if your financial situation improves. There is no penalty for paying it off sooner.
Some people complete their proposal early with extra payments, a lump sum, or increased monthly payments.
Is a consumer proposal cheaper than bankruptcy?
Not always. A consumer proposal may cost more than bankruptcy in some situations, but it can offer other important benefits, such as predictable monthly payments, avoiding bankruptcy, and keeping assets in most cases.
Bankruptcy costs can vary based on income, family size, assets, and surplus income rules. A Licensed Insolvency Trustee can compare both options and explain which may make more sense for your situation.
Will interest continue during a consumer proposal?
Once a consumer proposal is filed and accepted, interest stops on the unsecured debts included in the proposal. This can make it easier to focus on one fixed monthly payment instead of trying to keep up with growing balances.
Can my consumer proposal payment change?
In most cases, your consumer proposal payment stays the same once creditors accept it. If your income improves, your payment does not automatically increase the way it might in bankruptcy.
If your income drops or you are struggling to keep up, speak with your Licensed Insolvency Trustee as soon as possible. There may be options to discuss before missed payments become a bigger problem.
How do I know what my consumer proposal payment could be?
The best way to estimate your payment is to speak with a Licensed Insolvency Trustee. They will review your debts, income, assets, household expenses, and what your creditors may accept.
You can also use the calculator on this page for a general estimate before booking a free consultation.
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