Is bankruptcy or a consumer proposal better?
It depends on your income, assets, and goals. A consumer proposal lets you keep your assets, has a fixed monthly payment, and avoids surplus income rules. Bankruptcy can be faster and cheaper if you have few assets and low income. A Licensed Insolvency Trustee can model both for your situation.
How much do you pay in a consumer proposal?
You offer creditors a portion of what you owe, typically paid over up to 60 months. The offer must give creditors at least as much as they would receive in a bankruptcy, and creditors holding a majority of the dollar value of claims must accept it.
Does a consumer proposal or bankruptcy affect my credit more?
Bankruptcy has a larger impact. A first bankruptcy shows as an R9 and remains on your report for about 6 years after discharge. A consumer proposal shows as an R7 and is removed 3 years after completion or 6 years from filing, whichever comes first.
Can I keep my house and car in a consumer proposal?
Generally yes, provided you keep up secured payments (mortgage and car loan). Because a proposal does not vest your assets in a trustee, it is often chosen by people with home equity that exceeds their provincial exemption limit.