The 5 Steps in a Consumer Proposal

Step #1 – Consultation with trustee

You have a FREE confidential consultation at the trustee’s office.  You 

will have provided the trustee the information form from our website so  

that the trustee has all the necessary information to give you the best 

advice on your options.

If you have the ability to make a proposal to your creditors the trustee will 

explain the proposal rules to you. (next slide)……

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The 5 Steps in a Consumer Proposal

Step #1 – Consultation with trustee (continued)

• Proposal Rules:

• Cannot owe more than $250,000, excluding house mortgage;

• Term cannot be for more that 5 years;

• Creditors must be better off than if you file for bankruptcy;

• “Better off” can mean:

• Payments are made monthly over time;

• A third party such as a relative puts up lump sum to paid only 

if the creditors accept the proposal.

• Must be filed with a trustee in bankruptcy.

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The 5 Steps in a Consumer Proposal

Step #2 – Sign the Documents

Think over and digest the information received at the trustee’s

office.  If you decide to go ahead phone the trustee’s office 

and set up a time to go back to sign the documents.

This meeting will take about an hour.

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The 5 Steps in a Consumer Proposal

Step #3 – Creditors consider the proposal.

The trustee sends the creditors a report on the financial affairs of the person 

including the causes of financial difficulty; a copy of the proposal; a list of 

creditors and the trustee’s recommendation and reason why the creditors 

should accept the proposal.  

If no objection to the proposal is received within 45 days of the filing of the 

proposal it is deemed to have been accepted by the creditors. If no objection is 

received within 15 days after the deemed acceptance it is deemed to have 

been approved by the court.  If any creditor dissents a creditors’ meeting is 

required.   (next slide)..…       HOME

The 5 Steps in a Consumer Proposal

Step #3 – Creditors’ meeting to consider the proposal. 

Creditors vote at the meeting with a simple majority of the dollars voted 

deciding on acceptance or refusal of the proposal.  If the proposal is accepted 

all the creditors, including the ones who voted against the proposal or did not 

vote, are bound by the terms of the proposal.   

If the creditors do not accept or the court does not approve the consumer 

proposal, the debtor cannot make another consumer proposal.  The debtor is 

not automatically bankrupt if the consumer proposal is not accepted.

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The 5 Steps in a Consumer Proposal

Step #4 – Creditors approve the proposal. 

The vast majority of consumer proposals are accepted by the creditors 

because the creditors are better off financially than if the person goes 

bankrupt.

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The 5 Steps in a Consumer Proposal

Step #5 – Proposal is completed. 

The trustee will issue you a Certificate of Full Performance to certify that the 

proposal has been fully performed. All your eligible debts are now erased.  

The credit bureau is notified of the full performance of the proposal and in 3 

years the record of the proposal will be removed from your credit report.

The Certificate of Full Performance is an important document and should 

be kept in a safe place. HOME

The 5 Steps in a Consumer Proposal

Summary 

Step #1 – Consultation with trustee;

Step #2 – Sign the Documents;

Step #3 – Creditors consider the proposal;

Step #4 – Creditors approve the proposal;

Step #5 – Proposal is completed and eligible 

debts erased.

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