How to File a Consumer Proposal in London, Ontario

Adamson & Associates, Inc.
5 min readApr 10, 2024


If you’re struggling with debt and considering Bankruptcy, a Consumer Proposal could be a good alternative to regain control of your finances. In London, Ontario, filing a Consumer Proposal involves several steps. This guide will walk you through everything you need to know about how to file a Consumer Proposal, from understanding the basics to navigating the legal requirements.

Understanding How Consumer Proposals Work

A Consumer Proposal (also called a Consumer Debt Proposal) is an agreement between you and your creditors, overseen by a Licensed Insolvency Trustee (LIT). A Canadian Consumer Proposal is governed by the Bankruptcy and Insolvency Act and allows you to repay a portion of your debt over time. The amount you repay is based on your income and assets.

Only a Licensed Insolvency Trustee can file a Consumer Proposal in Canada. To make it official, the majority of your creditors need to accept the plan. If they do, you’ll have up to 5 years to pay back what you owe.

Key terms to know

  • Licensed Insolvency Trustee (LIT): An LIT is a professional licensed by the government to help with Consumer Proposals and other debt solutions. They guide you through the process and make sure everything is done according to the law.
  • Unsecured Debts: These are debts that don’t have any collateral, like credit card debts or personal loans. Consumer Proposals mainly deal with these kinds of debts.
  • Office of the Superintendent of Bankruptcy (OSB): The OSB is a government agency that supervises bankruptcy and debt processes in Canada, including Consumer Proposals.

Benefits of Filing a Consumer Proposal

  • Debt Relief: A Consumer Proposal can greatly lower your debt (by up to 70%), easing your financial stress. You also stop accumulating interest on your debt. Plus, you consolidate your debts into one manageable monthly payment, and you get to keep your assets, such as your home, car, and retirement savings.
  • Stop Creditors: When you file a Consumer Proposal, creditors must stop trying to collect money through wage garnishments, collection agencies or lawsuits. Creditors included in the proposal are legally bound and cannot change their minds later to pursue you for the debt.
  • Avoid Bankruptcy: A Consumer Proposal lets you deal with your debts without having to declare Bankruptcy, which can have more serious consequences.

How a Consumer Proposal Affects Your Credit

When you file a Consumer Proposal, it will impact your credit. Your credit report will show that you have made a proposal, and this information can be seen by anyone you allow to view your credit report.

Your creditors might also report a “7” rating on the debts included in the proposal. This rating means that they are getting paid through a third party, which is your trustee. Your trustee will distribute the agreed-upon amount to each creditor after deducting fees.

If you are paying monthly to secured creditors (like for a car loan) outside of your Consumer Proposal, those debts will be reported separately by the creditors you are paying. Keeping to a budget can make managing these payments easier.

Keeping a good payment history on secured debts can help you rebuild your credit.

Steps to Filing a Consumer Proposal in London, Ontario

If you’re thinking about filing a Consumer Proposal, here’s a simple guide to help you through the process:

  • Check Your Finances: Understand how much you owe, including unsecured debts (credit cards, lines of credit, personal loans), and see if you can afford monthly payments.
  • Determine if You Qualify: To qualify in London, Ontario, you have to meet certain criteria. Consumer Proposal laws state that you must owe less than $250,000 (excluding your home mortgage) and show you can’t repay your debts in full.
  • Talk to a Licensed Insolvency Trustee: Contact a Licensed Insolvency Trustee in London to discuss your situation and get advice. They’ll assess if a Consumer Proposal is right for you.
  • Prepare a Proposal: Work with your LIT to create a formal proposal. It will outline how much you can pay your creditors, the payment schedule (usually up to 5 years), and other details.
  • Submit to Creditors: Creditors have 45 days to decide. If most of them agree, the proposal becomes legally binding for all.
  • Meet Your Commitments: If your proposal is accepted, you must follow the terms. This includes making monthly payments to your trustee, attending financial counselling sessions, and updating your finances when asked.
  • Complete the Proposal: Once you’ve met all the terms, including paying off your debts, you’ll receive a Certificate of Full Performance, showing you’ve successfully completed the Consumer Proposal process.
  • Rebuilding Your Credit: It’s important to start rebuilding your credit after a Consumer Proposal. Even though the proposal stays on your credit report for a few years, you can start boosting your credit score while you’re still in the proposal. One way is to get a secured credit card, where you use your money as security to build credit. Also, since you’re not paying as much in debts, you might find it easier to save money during and after the proposal, which can help your finances overall.

Get Expert Help for Getting Out of Debt

As experienced Licensed Insolvency Trustees, Adamson & Associates Inc. are dedicated to helping you become debt-free. In your first consultation, we’ll carefully review your finances and discuss all the ways to relieve your debt.

We’ll explain the pros and cons of each option and give you expert advice on the best steps for you and your family. You won’t be rushed into a decision. We want to give you the information you need to make the right choice for your financial future.

Our aim is to help you live without the stress of overwhelming debt. We treat everyone with respect and dignity, and we’ll never judge your financial situation. If you need compassionate guidance about your finances, please contact us at our London North office at (519) 451–2122 or our London South office at (519) 681–8288. Let us help you find the solutions you’re looking for.

Here’s What Our Clients Say

Over the past 20 years, we’ve had the privilege of helping thousands of clients in Ontario resolve debt issues through Credit Counselling, Consumer Proposals, and Bankruptcy.

⭐⭐⭐⭐⭐ I had a free consult with John and he was able to give me enough suggestions and advice during the consult to help me get my head above water. He framed it in a way that was easy to understand and he was very easy to talk to and not judgmental about the situation I found myself in. I am very grateful for his assistance, even though I was not even a paying customer he offered great advice! I would recommend him to anyone needing debt assistance. — Jenn B. 8/11/2021

⭐⭐⭐⭐⭐These people are wonderful to deal with I had to go this route awhile back after I was involved in an accident and they are very professional and they are very caring if I were to ever have to go this route again I would absolutely use these guys they treat you like a human being and they have compassion for your situation you cannot go wrong with this agency!!! — Nathan B. 1/05/2022

⭐⭐⭐⭐⭐If you want someone to help with your financial situation, please see Mr. Adamson, it was the best call I ever made, he is very very helpful and understanding, also helps you to make good choices about your financial situation, I will forever be thankful for his help, if I could give 10 stars I would. — Debra P. 6/23/2022

Originally published at on April 10, 2024.



Adamson & Associates, Inc.

Licensed Insolvency Trustee. Experts in bankruptcy, consumer proposals, credit counselling, and other debt solutions in Ontario.