Knowledge is power when it comes to dealing with problem debt. This infographic shows the difference between filing a Consumer Proposal and bankruptcy. Find out which option may be best suited to your situation.
| Questions | Bankruptcy | Consumer Proposal |
| Who can claim? | Anyone who is insolvent and owes more than $1,000. | If your debts do not exceed $300,000 (excluding mortgage) and you are able to make monthly payments toward paying off a portion o your debt. |
| Who can file? | Must be filed by a Licensed Insolvency Trustee. | Must be filed by a Licensed Insolvency Trustee. |
| What does it cost? | Payment are based on income, non-discretionary expenses and household size. | A proposal amount is agreed between you and creditors. A monthly payment is determined based on your debts and any assets. Administration costs are included in the monthly payment. |
| How long will it last? | For first time bankruptcies – a minimum of 9 months. | Up to 5 years but may be paid off early with no penalty. |
| Will I lose my assets? | Certain assets are surrendered depending which province you live in. | No assets are surrendered. |
| What about my tax refund? | Turned over to your creditors. | You are allowed to keep refunds. |
| How will it affect my credit rating? | Your credit rating will show R9 for 7 to 14 years. This is the worst rating. | Your credit rating will show R9 during the period of proposal, and go to R7 once the proposal has been completed, with all payments made. This indicated you have made a settlement with your creditors. |
| Do I have to report monthly? | You must submit a report that details all income and expenses and include pay stubs and certain receipts. | No monthly reports are required. |
| Will I stop collections and wage garnishment? | Contact from creditors cease upon filing. | Contact from creditors cease upon filing. |
Interested to learn more about the differences between Consumer Proposal and Bankruptcy? Listen to our Licensed Insolvency Trustee, Jillian Taylor-Mancusi in the podcast below. Read the transcript on Debt Matters.
Contact Us for Debt Relief
Everyone’s financial situation is unique. Contact us for a free, no-obligation consultation where we will explain all of your options. You can then decide on the best alternative for you and your family. Call LCTaylor toll free at 1-800-463-8371.
Jillian Taylor-Mancusi, LIT
Jillian has worked in the insolvency field since 1992. She is a graduate of the University of Manitoba. She received her Insolvency Counselor’s Qualification Certificate from Ryerson Polytechnic University in 1998, and in 2007 she attained her license as a Licensed Insolvency Trustee. Jillian is a Read More
Jillian has worked in the insolvency field since 1992. She is a graduate of the University of Manitoba. She received her Insolvency Counselor’s Qualification Certificate from Ryerson Polytechnic University in 1998, and in 2007 she attained her license as a Licensed Insolvency Trustee. Jillian is a member of the Canadian Association of Insolvency and Restructuring Professionals (CAIRP). She is Past President of the Manitoba Association of Insolvency and Restructuring Professionals (MAIRP).Jillian has held positions on the Armstrong Point Association, Executive of her local EDA Riding Association, Manitoba Highland Dance Association, and the Continuing Education Committee of CAIRP. Previously, Jillian was the Treasurer for the Parent Association at her daughter’s school. Currently, Jillian serves as the Chair for Dressage Winnipeg. Close
