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Home›Debt Relief Options›Consumer Proposal
Debt Relief Options

Consumer Proposal
in Ontario

Reduce your unsecured debt with one affordable monthly payment. Stop collection calls, freeze interest, and avoid bankruptcy — all through a legal process administered by a Licensed Insolvency Trustee.

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No Upfront Fees
· Confidential
· No Obligation
★★★★★4.9from 65+ reviews
Licensed and regulated by the Office of the Superintendent of Bankruptcy Canada
Estimated Total Debt
$45,000 owed
Repay in full$45,000
With a proposal~$13,500
~$31,500 less to repay70% reduction
One payment · No interest · Up to 5 years

Example only. Your payment depends on income, assets, creditors, family size, and proposal terms.

Collection calls stop
Interest stops on included debts
Keep your home & car
Avoid bankruptcy

Free Consultation

Book Your Free 30-Minute Consultation

Tell us a little about your situation and we'll be in touch within one business day.

Free Consultation

Book Your Free 30-Minute Consultation

Tell us a little about your situation and we'll be in
touch within one business day.

Confidential · No obligation · No judgment

What It Is

What Is a Consumer Proposal?

A consumer proposal is a formal, legal agreement between you and your unsecured creditors. Instead of paying back everything you owe, you offer to repay a portion — through one affordable monthly payment.

Consumer proposals are administered by a Licensed Insolvency Trustee and regulated under Canada's Bankruptcy and Insolvency Act. The proposal can last up to five years, and once completed, the remaining included debts are legally released.

For many people it is a practical alternative to bankruptcy: you keep your assets, stop the calls, and get a clear end date for becoming debt-free.

Reduce total unsecured debt you repay
Stop collection calls and most wage garnishments
Interest on included debts stops immediately
One simple monthly payment — no juggling creditors
Keep your home, vehicle, and savings
FILED
Bankruptcy & Insolvency Act · CanadaConsumer ProposalAdministered by a Licensed Insolvency Trustee
Debt reductionUp to 80% forgiven
Interest stopsDay one — by law
Creditors boundAll unsecured creditors
Trustee signature
Court filing
Legally binding agreement
filed under Canadian law
Administered by a Licensed Insolvency Trustee · Regulated under the Bankruptcy and Insolvency Act
Qualify?

Is a Consumer Proposal Right for You?

A consumer proposal may be worth considering if any of the following describe your situation.

You owe more than you can realistically repay
You're only making minimum payments on credit cards
You're using payday loans to cover basic expenses
You have CRA tax debt you cannot pay in full
You're receiving collection calls or legal threats
You want to avoid bankruptcy if at all possible
You have steady income but need a lower payment
Your total debt does not exceed $250,000, excluding a mortgage on your principal residence
What's Covered

Debts That Can Be Included

A consumer proposal typically covers unsecured debts. Here's what's usually included:

Credit cards
Payday loans
Personal loans
Lines of credit
CRA income tax debt
HST debt 
Utility and phone bills
Repossessed vehicle shortfalls
Student loans (in some cases)
Not usually included: Court fines, child or spousal support, debts from fraud, and student loans if you stopped being a student less than seven years ago. Secured debts (mortgages, car loans) are handled separately — if you want to keep the asset, you continue making those payments directly.
The Process

How the Consumer Proposal Process Works

The process is straightforward. You don't need to know the solution before you call us — our job is to explain your options and guide you from start to finish.

Filing Protections
Collection calls stop
Interest stops on included debts
Most wage garnishments stop
Most lawsuits halted
CRA collection activity stopped
1
Free Confidential Consultation
We review your income, expenses, assets, and debts. You don't need to have answers — just your situation. We explain what makes sense for you.
2
We Prepare an Affordable Proposal
We help develop an offer to your creditors — paying a percentage of what you owe, extended over time, or both. The goal is affordable for you and acceptable to them.
3
Your Proposal Is Filed
Once filed with the Office of the Superintendent of Bankruptcy, you stop paying unsecured creditors. Collection calls, most lawsuits, and wage garnishments are immediately stopped by law.
4
Creditors Review the Proposal
Creditors have 45 days to review and respond. Once accepted, the proposal becomes legally binding on all included unsecured creditors.
5
One Monthly Payment
You make a single payment to us each month. We distribute funds to your creditors. No additional interest is charged on debts in the proposal.
6
Certificate of Completion
When all proposal terms are fulfilled, you receive a certificate of full performance. The remaining included debts are legally discharged.
Comparing Your Options

Consumer Proposal vs. Bankruptcy

Both are legal debt solutions — but they work differently. We'll compare them with you before you decide.

Consumer ProposalBankruptcy
What you repayA portion of what you owe AdvantageA portion of your income every month and you may surrender certain assets depending on your situation
Your assetsKeep home, car, savings if secured payments maintained AdvantageAsset exemptions rules may apply on what you may keep
Monthly paymentsOne fixed payment — never changes AdvantageMay change based on income fluctuations
DurationUp to five years; pay off early at any timeFirst bankruptcy can be 9 to 21 months, subsequent bankruptcies are for 24+ months 
Credit report notationR7 rating; removed 3 years after completion or 6 years from when filedR9 rating; stays longer on credit report
Public recordYes, but less stigma than bankruptcyYes — formal bankruptcy filing

How much could a proposal reduce your debt?

The amount depends on your income, assets, family size, and creditors. The best way to estimate your payment is to speak with a Licensed Insolvency Trustee — for free.

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What to Expect

What Happens to My Credit?

A consumer proposal will affect your credit rating. However, most people considering a proposal already have missed payments, high balances, or accounts in collections — meaning credit damage is already occurring.

The benefit is that a consumer proposal gives you a structured path to deal with the debt and begin rebuilding. Many people begin rebuilding credit during and after a consumer proposal, but timelines vary. Equifax and TransUnion remove a consumer proposal 3 years after completion or 6 years after signing, whichever comes sooner.

You'll also complete two mandatory financial counselling sessions as part of the process — skills to help you stay on track after.

During the Proposal
An R7 notation is placed on your credit file. Creditors will see you are in an active consumer proposal. This is the reset — it stops the bleeding.
While Making Payments
You can begin rebuilding by using a secured credit card responsibly. On-time payments are reported and start improving your score.
After Completion
The proposal notation is removed 3 years after completion or 6 years after signing, whichever comes sooner. Many people begin rebuilding to a good credit score during and after the proposal — timelines vary by individual.
Why Work With Us

Why Work With Litvack Group?

Litvack Group is a Licensed Insolvency Trustee firm serving individuals across Ontario.
When you speak with us, here's what you can expect.

Private, judgment-free consultation
What you share stays between you and your trustee. There is no judgment here — only clear information and practical options.
All Options Reviewed
We review every debt relief option — not just one solution. You'll understand every path before deciding.
Licensed Professionals
Clear answers from fully licensed debt professionals — regulated, experienced, and here to help.
No Upfront Fees
Your consultation is completely free. Fees are built into the proposal payments — nothing out of pocket to start.
Full Support
We're with you from consultation through to your certificate of completion. You're never left to navigate this alone.
Serving Most of Ontario
Toronto, Ottawa, North Bay, and surrounding areas. In-person or by phone — whatever works for you.
Fees & Cost

How Much Does a Consumer Proposal Cost?

There are no separate upfront fees to file a consumer proposal. The Licensed Insolvency Trustee's fees are set by government regulation and are paid from the proposal payments you make — not billed separately.

In other words, the payment you agree to with your creditors already accounts for trustee fees. You do not make separate payments to us.

Your consultation is completely free and carries no obligation. You can get a full picture of your options before deciding anything.

$0
Upfront cost
No payment required to start or to attend your consultation.
Regulated
Trustee fees
Set by federal regulation — not negotiated separately or billed on top.
Included
In your payment
Fees are paid from the same monthly proposal payment you make to your creditors.

Want to know what your monthly payment could look like?
We can estimate it in a free consultation — based on your actual debts, income, and situation.

Book My Free Consultation →
Comparing Your Options

Consumer Proposal vs. Debt Consolidation

These are often confused, but they work very differently. Understanding the distinction can help you choose the right path.

Consumer ProposalDebt Consolidation Loan
What it isA legal process under the Bankruptcy and Insolvency Act — not a loan Key differenceA new loan used to pay off existing debts — you still owe the full amount
Reduces principal?Yes — you repay a portion of what you owe AdvantageNo — you borrow to pay in full; principal stays the same
Legal protectionYes — stay of proceedings stops collection, garnishments, lawsuits AdvantageNo — creditors retain full rights to collect
InterestStops on included debts immediatelyNew interest rate applies on the consolidation loan
Credit requirementNo credit approval needed — available even with poor credit AdvantageRequires qualifying credit; often unavailable when credit score and income are low
Who administers itLicensed Insolvency Trustee — federally regulatedBank, credit union, or lender
Getting Ready

What to Prepare for Your Consultation

You don't need to have everything perfectly organized before you call. If you're not sure about something, that's fine — we'll help you figure it out together. But if you want to come prepared, here's what's useful to have on hand:

Recent statements from each creditor (credit cards, loans, lines of credit)
Your most recent pay stubs or proof of income
A rough sense of your monthly expenses
Any CRA notices or tax debt information
A list of assets (home, vehicle, savings, RRSPs)
Family size and household information
Don't have everything ready? That's completely fine. Many people call us before they've gathered any documents. We can work with whatever you have and help you identify what might be needed.

Ready when you are. A free consultation takes about 30 - 45 minutes, by phone or in person.

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Common Questions

Consumer Proposal Frequently Asked Questions

Q
Who can file a consumer proposal?
An individual can file a consumer proposal if their total debts do not exceed $250,000, not including a mortgage secured by their principal residence. If debts are higher, other proposal options may be available. A Licensed Insolvency Trustee can review your situation in a free consultation.
Q
How long does a consumer proposal last?
A consumer proposal can last up to five years. Some proposals are shorter, and you may pay it off early at any time — with no penalty for doing so.
Q
Do creditors have to accept my proposal?
Creditors have 45 days to review the proposal. Acceptance is based on creditor voting rules under the Bankruptcy and Insolvency Act. We help prepare an offer designed to be reasonable for both you and your creditors, based on what they would realistically receive in bankruptcy.
Q
Will a consumer proposal stop collection calls?
Yes. Once a consumer proposal is filed, a stay of proceedings takes effect. This stops most collection calls, lawsuits, and wage garnishments from unsecured creditors included in the proposal. If a creditor contacts you after filing, you can refer them directly to the Licensed Insolvency Trustee to contact them.
Q
Can CRA debt be included in a consumer proposal?
Yes. Many CRA income tax debts — including income tax arrears and HST for business owners — can be included in a consumer proposal. CRA reviews the proposal as a creditor and may request supporting tax filings or information.
Q
Will I lose my home or car?
Most people who file a consumer proposal keep their assets. If you have a mortgage or vehicle loan and want to keep the property, you generally continue making those secured payments directly. During your consultation, we review your assets so you understand exactly what to expect before anything is signed.
Q
Will my spouse be affected?
Your spouse is not automatically affected by your consumer proposal unless they co-signed or jointly owe the debt. Joint debts remain the responsibility of the co-borrower.
Q
What happens if I miss payments?
If you miss three monthly payments, the proposal can be annulled. If that happens, creditors may regain the right to collect the debts. Contact your trustee as soon as possible if you are having difficulty making payments — we can often find a solution before it reaches that point.
Q
What if creditors reject my proposal?
If a proposal is not accepted, you may be able to amend it, consider another debt solution, or file bankruptcy. We explain all of your options before you make any decision — you're never pushed into something that isn't right for your situation.

Ready to Understand Your Options?

You don't have to decide today. Start with a free, confidential consultation and learn what a consumer proposal could look like for your situation.

Book My Free Consultation →
Or call (647) 946-2077
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