Consumer Proposals


If you are experiencing financial problems and you have the ability to offer something to your creditors, a proposal may be a good option. There are two types of proposals: a consumer proposal and a Division 1 proposal. MGM Trustee has a team of knowledgeable, experienced and friendly professionals that can help prepare and file a proposal to your creditors.

Consumer Proposal
• A formal, legally binding debt settlement with creditors usually to pay a percentage of the amount owed. It can also be for an extension of time.
• Alternative to filing an assignment in bankruptcy
• Filed with an administrator of consumer proposals (Licensed Insolvency Trustee – LIT)
• Regulated by the Federal Government
• Stops wage garnishment and legal action by unsecured creditors
• Filed by individuals whose debt is $250,000 or less (excluding mortgage on principal residence)
• Usually, the debtor retains possession of their assets
• Terms of proposal cannot exceed 5 years
• Payments are usually monthly and there is no interest
• Two financial counselling sessions provided
• Creditors vote on proposal
• Majority vote required for acceptance
• If rejected by creditors, no deemed bankruptcy

For complete information on the consumer proposal process, contact MGM Trustee for your debt solutions.

Division 1 Proposal
• A formal, legally binding arrangement with creditors
• Administered by a Licensed Insolvency Trustee (LIT)
• Regulated by the Federal Government
• Available to businesses and individuals with debt over $250,000
• Legal action by unsecured creditors is stopped upon filing a Notice of Intention and/or a proposal
• Secured creditors can be included
• Term usually up to five years
• You usually keep your assets
• Creditors vote on proposal
• Rejection by creditors results in a deemed bankruptcy

For complete information on the Division 1 Proposals, contact MGM Trustee for assistance with debt relief.

Contact MGM Trustee
Connect with us for a free consultation to help take back control of your finances.