Successfully Filing & Completing A Consumer Proposal
Your Consumer Proposal, From Start To Finish
We have discussed the basic elements of a Consumer Proposal under “Consumer Proposal Overview and Benefits”. Essential information, such as who is eligible to file a Proposal, and why such an offering to your creditors might be the best choice you make to clear up your debt problems, are addressed in that article.
Now we take a look at how to file and complete your Consumer Proposal.
In comparison to filing a Bankruptcy, a Consumer Proposal is designed to be easily within reach for most people. Finishing your Proposal on time, or early, allows you to rebuild your credit and clear up your credit rating.
The Consumer Proposal Process
In order to initiate the process of filing a Consumer Proposal (and the ultimate goal of successfully completing that Consumer Proposal), you will need to work through the following (simplified) process with your Insolvency Trustee:
- Click to schedule a free, confidential consultation at an office near you. We will make arrangements for you to attend a meeting with one of our debt professionals to discuss your financial situation and all of your debt relief options. We understand the insolvency process - our firm has been helping people with debt problems for more than 36 years and we have 50+ offices and more than 160 staff available to serve you.
- At your confidential consultation, we will be legally obligated to discuss all of your debt relief options with you. We will also thoroughly review your finances. Then a recommendation will be made, providing you with a detailed plan of how to get out of debt. Developing a successful Proposal is something our firm is extremely adept at.
- If you decide a Consumer Proposal is the right option for you, we will work with you to get the required forms completed quickly. We will then electronically file your Consumer Proposal with the Office of the Superintendent of Bankruptcy. The estate/court number that the government assigns to your file will serve to provide protection from your creditors. From this point onwards, your debts are frozen, interest ceases, and garnishments will be lifted.
- Your Insolvency Trustee will then be responsible for all further communication with your creditors. You will no longer need to deal with creditors or collection agencies.
- Your creditors will have 45 days to either accept or reject your proposal. Any creditor with a proven claim may accept or object to your proposal. This can be done either prior to or at the meeting of creditors, if one is held. It can also be done within 45 days following the filing of your Consumer Proposal.
- A meeting of creditors will be called if one is requested by one or more creditors having at least 25% of the value of the proven claims. This request must be made within 45 days of the filing of your proposal. The OSB can also direct your Trustee to call a meeting of creditors at any time within this 45-day period. A meeting of creditors will be held within 21 days after being called.
- Once your Consumer Proposal is approved by your creditors, there is a standard 15-day waiting period until Court Approval. Once that is confirmed you will be notified by mail of the acceptance of your Consumer Proposal.
- You continue to make your payments for the term of the Consumer Proposal.
- You attend 2 mandatory Counseling Sessions. Each counseling session walks you through the budgeting, money management, and the process of rebuilding your credit record. These are extremely helpful in teaching you how to financially reorganize your life (30-60 minutes in length each).
Your Duties In Completing Your Consumer Proposal
How do you reach the Consumer Proposal finish line? By paying careful attention to a short list of “duties” (as outlined in the Federal Government’s legislation, known as the "Bankruptcy Insolvency Act") and completing them all successfully. What are these duties? Let’s take a look:
- Monthly Proposal Payment:
Each month you will pay the Trustee an agreed-upon fee that is “locked in” once the Proposal is accepted by your creditors. No surprises.
- Deemed Annulment:
Anyone with a Consumer Proposal must heed the “three strikes rule”, which is known officially as a “deemed annulment". This occurs when you miss a total of three payments over the course of the Proposal and don’t make up the payments in a timely manner.
- Financial Counseling Sessions:
You will be required to attend two financial counseling sessions (each of which is a confidential meeting, with a licensed & OSB-registered counselor, and can run anywhere from 30 to 60 minutes).
- Contact Information:
If you move, change jobs or get a new cell or home phone number, you are required to update your records with our staff. Providing an email address to us will also ensure we can reach you when we need to.
- Attend a Meeting of Creditors at the Trustee’s offices (if one is called):
Most Consumer Proposals get the court approval stage without a Meeting of Creditors being required.
Certificate Of Full Performance
If all of the above duties are completed successfully, it’s very likely your Consumer Proposal will be, too. Once your Insolvency Trustee has confirmed that you have completed all of the required duties, he can sign off on your Certificate of Full Performance and your Consumer Proposal will reach its end.
The next step? Rebuilding your credit using a variety of strategies, as outlined and discussed during the two counseling sessions you will have participated in during the course of your Proposal. And yes, we can help you with that, too.
But let's start with the first step: fill out the form below to request your free, confidential consultation with A. Farber & Partners: