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What is a Consumer Proposal?
Technically speaking, a consumer proposal is a legal, binding arrangement under which you repay your unsecured creditors a portion of what you owe with no interest accumulating on the debt. A consumer proposal is a powerful mechanism for dealing with creditors and it is governed by rules and regulations contained in the Bankruptcy and Insolvency Act. Filing a consumer proposal provides you with immediate protection from virtually all unsecured creditors and any collections or legal action by creditors is immediately stopped.
Do I Qualify to File a Consumer Proposal?
If you are unable to repay your debt obligations as and when due and your debts do not exceed $250,000 (excluding mortgages owed on a principal residence), you qualify to file a consumer proposal.
How Does a Consumer Proposal Work?
A consumer proposal is federally regulated process that enables you to repay your debts, with no interest, within a maximum 5-year period. In most cases, creditors will agree to reduce the total amount owing.
Only a Licensed Insolvency Trustee (LIT) can help you file a consumer proposal. A LIT will meet with you to review your situation and discuss the options. A consumer proposal is one of several options available.
If you decide a consumer proposal is the right option for you, the LIT will collect financial information from you in order to help you formulate a fair and reasonable proposal to your creditors, and prepare the necessary filing documents. Once you sign the filing documents, the LIT will e-file them with a federal regulator (the Office of the Superintendent of Bankruptcy) and this is the point when your consumer proposal process officially begins. At this point you will stop paying your creditors, except for certain secured loans (such as car loans and mortgages) which are generally not affected by filing a consumer proposal.
Once your consumer proposal has been filed, the LIT will notify your creditors of the consumer proposal. You do not have to communicate with your creditors once the proposal has been filed, but it may take a few days to a couple of weeks for the creditors to receive and process the proposal notice.
Your consumer proposal is deemed accepted 45 days after the filing date provided there is no requirement for a meeting of creditors. A meeting of creditors is required if 25% in dollar value of the proven creditors request a meeting within the 45-day period. The purpose of the meeting is to vote on the consumer proposal. The consumer proposal will be accepted if a majority in dollar value of the creditors vote to accept your proposal. If you do not have the required support from your creditors, it may be necessary to amend or alter the terms to make it acceptable to your creditors. The LIT will assist in any creditor negotiation.
Your consumer proposal is deemed approved by the court 15 days after creditor approval. After court approval your consumer proposal is a legal, binding agreement with your creditors.
Consumer proposal payments are paid to your LIT, who distributes the payments to your creditors. In addition to making your payments on time, you must also attend two mandatory financial counselling sessions, which may be arranged by the LIT.
Only a Licensed Insolvency Trustee (LIT) can help you file a consumer proposal. A LIT will meet with you to review your situation and discuss the options. A consumer proposal is one of several options available.
If you decide a consumer proposal is the right option for you, the LIT will collect financial information from you in order to help you formulate a fair and reasonable proposal to your creditors, and prepare the necessary filing documents. Once you sign the filing documents, the LIT will e-file them with a federal regulator (the Office of the Superintendent of Bankruptcy) and this is the point when your consumer proposal process officially begins. At this point you will stop paying your creditors, except for certain secured loans (such as car loans and mortgages) which are generally not affected by filing a consumer proposal.
Once your consumer proposal has been filed, the LIT will notify your creditors of the consumer proposal. You do not have to communicate with your creditors once the proposal has been filed, but it may take a few days to a couple of weeks for the creditors to receive and process the proposal notice.
Your consumer proposal is deemed accepted 45 days after the filing date provided there is no requirement for a meeting of creditors. A meeting of creditors is required if 25% in dollar value of the proven creditors request a meeting within the 45-day period. The purpose of the meeting is to vote on the consumer proposal. The consumer proposal will be accepted if a majority in dollar value of the creditors vote to accept your proposal. If you do not have the required support from your creditors, it may be necessary to amend or alter the terms to make it acceptable to your creditors. The LIT will assist in any creditor negotiation.
Your consumer proposal is deemed approved by the court 15 days after creditor approval. After court approval your consumer proposal is a legal, binding agreement with your creditors.
Consumer proposal payments are paid to your LIT, who distributes the payments to your creditors. In addition to making your payments on time, you must also attend two mandatory financial counselling sessions, which may be arranged by the LIT.
Where to File a Consumer Proposal in Vancouver, BC
If you are looking for advice and help with a consumer proposal in Vancouver, BC, we have two conveniently located offices in Vancouver to better serve our clients. Our Downtown Vancouver office is located at #1600, 1021 West Hastings Street in MNP Tower, next to the iconic Marine Building on the corner of Hastings and Burrard. Our South Vancouver office is located in Vancouver's Marpole neighbourhood at #1100, 1200 West 73rd Avenue, in Airport Square Tower.
Regular office hours in our Vancouver locations are Monday to Friday, 8:30 am to 5:00 pm. We offer flexible evening and Saturday appointments on request. Call us at 604-639-0001 to book your free, confidential, no-obligation consultation, or fill out our form below and we will contact you within 30 minutes during regular business hours.
Regular office hours in our Vancouver locations are Monday to Friday, 8:30 am to 5:00 pm. We offer flexible evening and Saturday appointments on request. Call us at 604-639-0001 to book your free, confidential, no-obligation consultation, or fill out our form below and we will contact you within 30 minutes during regular business hours.
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Downtown Vancouver Office
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South Vancouver (Marpole) Office
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