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Formal Programs

A formal program offers relief to those in debt through legal programs that help you obtain protection from your creditors offered by the Law.

The Bankruptcy and Insolvency Act (BIA) is the law that is most referred to. The programs covered under the BIA must adhere to the legal statutes. Other laws legislated at the Federal, Provincial and Municipal levels of government, can also impact your case directly or indirectly. The Criminal and Civil Laws will help determine which debts and how much of them qualify for forgiveness.

Consumer Proposal

A Consumer Proposal is available to individuals and businesses in which creditors would be made an offer to modify payments. In other words, it is a plan between you and the creditor that allows you to pay only a portion of the debt owed or gain extra time to repay all of it.

Filing a consumer proposal is the right decision for you if you do not want to file bankruptcy, if you want to cease the interest charges, do not want your assets to be taken away or if you need more time to repay your debt. You are eligible for a consumer proposal if your debt is greater than $1,000 and does not exceed $250,000.  If a creditor approves the proposal, it can result in a lower, more manageable monthly payment over a longer period of time, usually not exceeding over five years.

If three payments are arrears or if at anytime the debtor decides to discontinue payments, then the proposal is cancelled. Legal protection ceases in the latter case unless the debtor subsequently files a Bankruptcy or an Ordinary Division 1 proposal. It is important that all your payments are made in a timely manner.

It is helpful to note that:


Your credit history has a direct impact on you. It can determine whether you are eligible for future credits and many employers who are in security and reputation sensitive industries may request to see it before hiring you. Equifax and Trans Union Canada are two credit-reporting agencies that compile your credit history by collecting borrowing and repayment data from your lenders. To view your credit report, you can visit or