Ontario Consumer Proposals - Ontario Personal Proposals.

There are two types of Person Proposals available that will allow you to avoid bankruptcy: Ontario Consumer Proposals and Ontario Division I Personal Proposals

This PowerPoint presentation outlines
the steps involved in a Consumer Proposal.

Consumer Proposals allow you to avoid bankruptcy, while paying off only a portion of your debts, or extending the time for payment.

Under the Bankruptcy and Insolvency Act, your Ontario bankruptcy trustees file a Consumer Proposal or an arrangement between you and your creditors to have you pay off only a portion of your debts, extend the time you have to pay off the debt, or provide some combination of both. To be acceptable, your creditors must be better off under an Ontario Consumer Proposal than if you go bankrupt.

This chart compares the two types of Personal Proposals
an individual can file:

	Ontario Consumer Proposals	Ontario Division I Personal Proposals
Who proposal is available to	Debtors owing only consumer debt amounting to less than $75,000, excluding a mortgage on the principal residence.	Debtors who have personal or business debt. There is no dollar limit on the amount of debt.
Stay of proceedings	Proposal stays all legal actions undertaken or contemplated by unsecured creditors.	Proposal stays all legal actions undertaken or contemplated by unsecured creditors.
Term	Cannot be for a term of more than five years.	Can be for any term that makes economic sense.
No. of counselling sessions required	Two	None
Period for acceptance of proposal by creditors	Deemed to be accepted after 45 days if creditors do not dissent or call for a creditors' meeting.	Creditors vote at a creditors' held in 21 days.
Period for court approval of proposal (after acceptance by creditors)	Deemed to be approved after 15 days following creditor acceptance if there is no request to take the proposal to court for approval.	The trustee applies for court approval expeditiously, usually within three weeks.
Creditors' meeting	Held if requested within 45 days of the filing.	Held approximately three weeks after the proposal is filed .
How proposal is accepted or rejected	It is either deemed to be accepted after 45 days (see above) or if creditors ask for a meeting, it is accepted by a simple majority of the dollars voted.	At least 66.67 percent (2/3) in dollars and 50% plus one in number of eligible creditors who vote must approve.
What happens if proposal is not accepted or approved?	Debtor cannot make another consumer proposal. Note that the debtor is not automatically bankrupt if the consumer proposal is not accepted. The Stay of Proceedings is lifted.	Debtor is immediately bankrupt effective on the date of the creditors' meeting.

Consumer Proposals and Division I Personal Proposals

Making a consumer proposal or a Division I Personal Proposal is a legal right that is available to solve your financial difficulties and allow you to avoid bankruptcy. It immediately stops all collection efforts and legal actions by your creditors. This includes lawsuits, seizures of assets and garnishments of earnings.

It affords you an opportunity to make an arrangement with your unsecured creditors that is both affordable to you and fair and reasonable to the creditors. Consumeer Proposals usually provide for settlement of your consumer debt by way of a series of monthly payments, with no ongoing interest charges. Alternatively, a lump sum settlement can be proposed. This process may allow you to pay off only a portion of your debts and/or extend the time you have to pay off those debts and you do not lose your assets by this filing.

Our fees as Administrator of the proposal are usually paid for out of the monthly payments called for in the proposal and are not an incremental cost to you.

At the end of your Consumer Proposal you will receive a certificate of full performance, which certifies that you have been released from all or most of your debts. The consumer proposal process includes one-on-one counseling sessions aimed at helping you regain control of your finances and prepare for a brighter financial future.