Consumer Proposal FAQ

Common questions about consumer proposals

What is a consumer proposal?

A consumer proposal allows you to consolidate your unsecured debts and offer to pay your creditors a smaller percentage of what you owe them. It’s a legal agreement you make with the help of a Licensed Insolvency Trustee and is a federally regulated program. A consumer proposal lets you keep your assets, freezes interest charges, stops collection calls, and shields you from lawsuits initiated by creditors. 

Is a consumer proposal the right debt relief option for you?

If you’re struggling to keep up with debt payments, a consumer proposal is an excellent debt relief option to pursue.

Do you earn a steady income and can afford to repay a reasonable portion of your unsecured debts? If so, a consumer proposal can work to your advantage. With much lighter debt payments to make, you’ll no longer face tough financial decisions like choosing between paying your credit card balance and electricity bill. You’ll also have more money available for life-enriching activities, like that family vacation you keep postponing or a down payment for your dream home.

However, suppose your debt obligations are exceptionally high, and you lack the means to repay even a small portion of your debts. In that case, bankruptcy may be a more suitable option than a consumer proposal.

Need more advice to determine if a consumer proposal is right for you? Then don’t hesitate to contact us to book a free, no-obligation consultation with one of our Licensed Insolvency Trustees. They can review your financial situation and recommend the best debt relief solution based on your circumstances.

We understand dealing with debt can be stressful and frustrating, even demoralizing. But, more importantly, we also understand how to guide individuals like yourself out of these seemingly hopeless situations and help you attain financial freedom. We’ve helped thousands of people from all walks of life do just that for over 20 years. We can help you, too!

Consumer Proposal FAQ

When you book a free consultation with one of our Licensed Insolvency Trustees, we’ll discuss all your debt-relief options and determine if a consumer proposal is right for you. You probably qualify for a consumer proposal if you’re a Canadian resident or citizen and owe less than $250,000, excluding mortgage debts.

Canadians are carrying a tremendous amount of debt today and most can be included in a consumer proposal, which will substantially reduce the amount you owe and how much you pay each month. These types of debt include credit card debt, CRA debt, student loan debt, personal loans, payday loans, lines of credit, etc.  

Inflation in Canada is on an upward trend—the cost of everything continues to rise. If your household bills have been increasing, stress around crushing debt repayment is likely growing as well. While a consumer proposal will not reduce your regular ongoing household expenses, such as groceries and utilities, it may reduce your debt payments (loans and credit cards) by up to 80%. And those are the payments that tend to come with very high interest. Most of our clients experience a great deal of relief after filing a consumer proposal as the family budget becomes much more manageable. 

Credit counselling is an important (and non-negotiable) aspect of filing a consumer proposal in Canada. Over the course of two mandatory sessions, you’ll learn valuable skills to help you rebuild your credit and prevent future debt problems.

Once your Licensed Insolvency Trustee notifies your creditors that a consumer proposal has been filed, they have 45 days to respond. During the approval period, creditors aren’t allowed to contact you – all communication must go through David Sklar & Associates. Should they fail to respond within 45 days, the law assumes they’ve accepted the terms of the proposal.

Most forms of debt may be included in a consumer proposal except for your mortgage and car loan. This means you will continue to make those payments as normal. You will not be required to surrender assets when you file a consumer proposal. 

Your credit report is a history of your relationship with your creditors and your debts.  This history is used by the creditors to gauge what level of risk there is in advancing new credit to you.  The combination of the history, the amount of credit you hold and the level of risk is what allows each creditor to generate your “Credit Score”.  The higher your score, the better the chances of receiving new credit at lower rates.

If you are in need of a Consumer Proposal or a Bankruptcy, your credit history is likely to have already been affected to varying degrees as a result of missed payments, collection actions or simply the total amount of credit that you have available, even if you are not using it.

Learn more about consumer proposal and credit ratings

Learn how to improve your credit rating

Depending on which comes sooner, either 3 years after you finish making payments to complete your consumer proposal or 6 years after filing. 

If you’re struggling with your student loan debt and it’s been seven years or more since you’ve been a student, you can eliminate it  by filing a consumer proposal. This “seven-year rule” applies only to government-issued student loans. Private student loans are automatically eligible for inclusion in a consumer proposal.

Learn more about how we can help you find student loan debt relief with a consumer proposal and personal bankruptcy.

Only you can decide if a consumer proposal is worth it for you, but we urge you to consider the facts! With a consumer proposal, you will have a manageable monthly payment based on your income, expenses, assets, and what you can afford. Ultimately, a consumer proposal is a fair debt-relief option for all parties while giving you a fresh financial start. 

Our favourite question of all?

“Why didn’t I do this years ago?!” 

Book your free consultation today! 

Learn about some of the consumer proposal experiences of our clients:

Getting into debt is easy. Getting out is a different story.

But it's still possible!

Did you know there is a Canadian debt relief program federally regulated by the Canadian Government, designed to help citizens avoid claiming bankruptcy? This amazing program can only be administered by a Licensed Insolvency Trustee (LIT).

If you’re struggling to make your payments every month and creditors won’t stop calling, we can help.

What our clients are saying.

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Carolina Marroquin
I am very pleased with the experience with your company. Great customer service and very professional. They made me feel like dealing with caring and friendly people. Jackie is a sweet lady. All of them very helpful.
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garfield wallace
I am very excited for the helpful service I receive from David sklar &Associates Inc ! My experience with coronation she is a professional and skill person! We'll done ✔ thank you very much, Gw
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ray pat
Great and friendly staff. They went out of their way to help me with the process. David Sklar and Associates are more then professionals. Christine sylver helped me with every steps, everytime I asked for more help she was always there for me with a smile. Very professional and patient. I want to thank Christine Sylver for everything she did to help me through this process and by giving me a new start.
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Penelope Mather
I was so nervous to go and then i met trina beautiful compassionate understanding trina how lucky for me what a professional thank you thank you
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Marina Granado
It was easy to get everything started and I am happy that I choose you, thank you.
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George Carvalho
I came in with a lot of anxietyChristine SylverHernee Templonuevogave me the confidence I needed
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Robert Barnes
A great place to find out the best way to remove your debt. I discussed my problem with a with a fantastic lady who's named Grace. This lady showed me a couple of ways to lower my debt and I chose one. Thanks to Grace one day I will be out of debt, but until then my spending without cause has come to an end.To the staff and especially Grace of David Sklar and Associates thank you.Bob Barnesi will be one day out of debt
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Verble Daniels
A wonderful experience with a very depressing financial situation.Cori is easy to talk to and understand, with what she is describing.
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We are David Sklar

Our team of Licensed Insolvency Trustees in Ontario can help you get out of debt and in control of your own financial future. We’ve helped thousands of people and we can help you too. 

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