Consumer Proposal or Bankruptcy

CONSUMER PROPOSALBANKRUPTCY
Debts between $1,000 and $250,000, excluding any house mortgagesDebts over $1,000
Proposal reflected for 3 years after completion of payments on your credit bureauBankruptcy reflected for 6-7 years from date of discharge on your credit bureau
Payments determined with Trustee and must be accepted by creditors. Payment Schedule can be up to 5 years and total payment must be greater than creditors would receive in a bankruptcyPayments set by legislation, equal to 50% of surplus income
Discharged upon completion of proposal termsFirst time bankrupt discharged by 9 or 21 months, depending on surplus income.Second time bankrupt discharged by 24 or 36 months, depending on surplus income.
You can apply for credit with no disclosureYou must inform the lender of your bankruptcy if borrowing more than $1,000.

SIMILARITIES

  • Secured creditors are dealt with directly by debtor to settle debts.
  • Anyone who has cosigned any debt with the debtor is still 100% liable for debts co-signed.
  • Stops all collection calls.
  • Payments can be amended if there is a change in financial situation (proposal needs creditor approval).
  • Two mandatory counselling sessions.
  • Certain debts not discharged, such as court fines, support arrears, fraud debt, student loans if bankrupt is still a student, or has been out of school for less than 7 years.