What’s the Difference between Bankruptcy and a Consumer Proposal


I want to briefly explain the difference between a consumer proposal and bankruptcy

In a bankruptcy you surrender everything you own to licensed insolvency trustee and in turn all your unsecured debts are eliminated. Some assets you are allowed to keep depending on which province you live in. Also a portion of your income may be taken each month for the term of the bankruptcy which usually lasts 9 to 21 months for a first time bankrupt.

A consumer proposal on the other hand is the alternative to bankruptcy. In this process all your assets are fully protected from your creditors and the debts are negotiated and paid off in an interest free payment plan. In some cases the amount owing may be negotiated down by as much as 75%.

It really depends on your situation as to which option would be best for you and you should always seek the advice of a professional before making this important decision.



Peter Temple is the owner of 4 Pillars Burnaby | Coquitlam | New Westminister.

Since 1998, 4 Pillars Consulting Group has supervised the successful debt restructuring and debt consolidation of billions of dollars of debt held by clients across Canada, with savings of up to 80% of original debts owed. We represent debtors to help them achieve the best possible outcome from their debt solutions, helping them show restitution to creditors and prevent claims of bankruptcy.

4 Pillars acts on behalf of the debtor, not the creditor. We are one of the only companies in the industry with this approach to debt elimination and financial restructuring strategies, resulting in services that solve immediate financial challenges and put debtors back on track with credit education, rebuilding credit and effectively managing their finances.

A Canadian-owned company, 4 Pillars is a leader in independent debt restructuring.