Your guide to consumer proposals—learn how they work, who qualifies, and how this debt solution can help you regain control of your finances.
Ready to ditch debt and reclaim your financial future? If you’re a Canadian feeling swamped by unsecured debts, a Consumer Proposal could be your game-changer. Here at Blanchard & Co., we’re not just experts; we’re your local guides in Central Alberta, committed to helping you navigate the path to financial freedom. Let’s dive into what this powerful debt solution is all about.
What’s a Consumer Proposal Anyway? Your Debt-Busting Basics
Think of a Consumer Proposal as your smart, strategic way to tackle unsecured debt without going full-on bankruptcy. It’s a formal, legally binding agreement where you get to offer your creditors a deal: either pay back a percentage of what you owe, stretch out your repayment time, or a combo of both – usually over a maximum of five years.
The coolest part? This whole process is handled by a Licensed Insolvency Trustee (LIT), like the seasoned pros right here at Blanchard & Co. We act as your neutral corner, helping you craft an offer that makes sense for your finances. Once your proposal is officially filed, BAM! You get an immediate “stay of proceedings.” That means collection calls, lawsuits, and wage garnishments hit the brakes. Your creditors then have about 45 days to weigh in, and if the majority agrees (by dollar value, of course), your proposal becomes legally binding on *all* unsecured creditors. You make manageable, interest-free payments to us, and we distribute the funds. Finish your payments and a couple of financial counseling sessions, and you’ll get a Certificate of Full Performance, wiping out those remaining unsecured debts. Sweet!
So, who qualifies? You need to live or own property in Canada, be unable to keep up with your debt payments, and owe less than $250,000 in unsecured debt (psst, your mortgage doesn’t count, and for couples, it can go up to $500,000). Not sure if it’s for you? Blanchard & Co. offers free, confidential consultations to figure out your best move!
A Blast from the Past: How Consumer Proposals Evolved
Believe it or not, the idea of Consumer Proposals has been simmering in Canadian insolvency laws for decades, with roots stretching back to the 1970 Tasse Report. But the real game-changer hit in 2009. Before then, if you were considering a Consumer Proposal (they were called Division II proposals back then), your unsecured debt couldn’t top $75,000. That 2009 tweak to the Bankruptcy and Insolvency Act (BIA) cranked the ceiling up to a whopping $250,000!
This wasn’t just a number change; it was a revolution. Suddenly, way more Canadians had access to this incredible debt relief option, steering clear of bankruptcy. What happened next? A huge surge in Consumer Proposals and a corresponding dip in personal bankruptcies. Today, CPs make up the lion’s share of consumer insolvency filings. As Licensed Insolvency Trustees in Central Alberta since 2007, Blanchard & Co. has seen this evolution firsthand, meaning you benefit from our deep understanding of the landscape!
The Buzz: Why Everyone’s Talking About Consumer Proposals
Today, Consumer Proposals are the darling of debt solutions, widely seen as the smarter, less drastic sibling to personal bankruptcy. Why the love?
- Keep Your Stuff: Unlike bankruptcy, you generally get to hold onto your home, car, and other valuable assets.
- Credit Karma: While there’s an impact (we’ll get to that!), it’s significantly less damaging to your credit score than bankruptcy.
- Fresh Start, Real Deal: It’s a genuine opportunity to hit reset. You consolidate your eligible debts into one easy, interest-free payment, collection calls stop dead, and no more interest piling up.
- Creditors Like It Too: Even your creditors often prefer CPs because they typically recover more money than they would if you declared bankruptcy.
With high living costs and household debt making headlines, more and more Canadians are turning to Consumer Proposals. It’s a clear sign that this solution is gaining serious traction for responsible debt relief. Our mission at Blanchard & Co. is to relieve financial burdens and set you up for a financially free future, and Consumer Proposals perfectly align with that goal.
The Nitty-Gritty: What to Watch Out For
While Consumer Proposals offer a lifeboat in a stormy financial sea, it’s crucial to be aware of a few considerations. This is where the expert guidance from a trusted LIT like Blanchard & Co. truly shines:
- Credit Impact: Yes, it will affect your credit score, but it’s not the end of the world! It usually stays on your credit report for three years after you complete your proposal, or six years from the filing date, whichever comes first. The good news? Our team can guide you on strategic credit rebuilding post-proposal.
- Public Record: Your Consumer Proposal becomes part of a permanent public record kept by the Office of the Superintendent of Bankruptcy (OSB). While typically only you, your creditors, and your trustee are actively aware, it is publicly searchable.
- It’s a Marathon, Not a Sprint: Consumer Proposals can take up to five years to complete. This might feel longer than some bankruptcy proceedings, but we’ll always provide comprehensive education on your financial conditions and options, so you know exactly what to expect.
- Don’t Default! Missing three monthly payments (or one payment by more than three months on a non-monthly schedule) can lead to your proposal being annulled. If that happens, your original debts are back, creditors can restart collection, and you can’t file another CP for those same debts. Revival is possible, but it’s a tight timeline and often requires creditor or court agreement. This is why our confidential advice and continuous support are absolutely vital for your success.
- What Debts *Can’t* Be Included? Some debts are typically excluded, like court-ordered alimony or child support, secured debts (think mortgages or car loans), and student loans less than seven years old. A thorough assessment by a Blanchard & Co. LIT is essential to pinpoint all eligible debts and craft the most effective solution for you.
Why Work with a Licensed Insolvency Trustee
There’s a lot of misinformation online about debt help in Canada. Some companies act as middlemen, charging high fees without the authority to file a legal proposal or bankruptcy.
A Licensed Insolvency Trustee, like Brian Blanchard, is the only professional recognized by the federal government to administer these solutions. That means you’re working directly with someone who knows the law, understands your rights, and puts your well-being first.
At Blanchard & Company, we’re not here to pressure you. We’re here to listen — and when you’re ready, to help you find the right path forward.
Taking the First Step Toward Financial Wellness
If financial stress is affecting your health, you don’t have to face it alone. Whether you’re searching for how financial stress affects your health, debt solutions in Canada, or consumer proposal Alberta, the most important step is to start the conversation.
When you reach out to Blanchard & Company, you’ll talk directly with a caring, local Licensed Insolvency Trustee who will explain your options clearly — no jargon, no judgment. You’ll learn about consumer proposals, debt consolidation, and other debt relief options that fit your unique situation.
Because peace of mind isn’t just about money. It’s about knowing you have a plan, a path forward, and someone on your side.
Ready to Reclaim Your Financial Peace?
If financial stress is keeping you awake at night, take a deep breath. You can change this.
Contact us today to connect with Brian Blanchard & Company — trusted Licensed Insolvency Trustees in Central Alberta.
We’ll sit down with you, one-on-one, to talk about real solutions that protect your credit, your assets, and your health.
No judgment. No pressure. Just honest help when you’re ready.
Because financial stress doesn’t have to control your life.
With the right help, you can find relief — and finally, a good night’s sleep.
People Also Ask:
What exactly is a consumer proposal?
A consumer proposal is a legally binding agreement handled by a Licensed Insolvency Trustee, where you offer to repay a portion of your unsecured debt over a period (up to five years), stopping interest and collection actions.
How does a consumer proposal affect my credit?
It will impact your credit: a consumer proposal remains on your credit report for up to three years after finishing payments, or six years from the filing date. But it’s generally less damaging than bankruptcy, and your LIT can help you rebuild credit afterward.
Who qualifies for a consumer proposal?
You qualify if: (1) you live or own property in Canada, (2) you can’t keep up with your unsecured debt payments, and (3) you have less than $250,000 in unsecured debt (or up to $500,000 for a couple).
Book Your Free Consultation with Blanchard & Co.
If you’re wondering what debt relief program is the best solution—or if there’s a more effective way to get out of debt—contact Blanchard & Co. in Red Deer today. Our team is here to guide you toward a brighter, more stable financial future.
Need a place to start?
At Blanchard & Co., we’re here to help you make sense of the options and walk with you every step of the way. Not with pressure—but with perspective.