Steps to Take Before You File a Consumer Proposal

Thinking about doing a consumer proposal but not sure how to start or what to do first? 

If you're living in Canada and looking for a smart way to manage what you owe, a consumer proposal is a solid choice. But before jumping in, there are a few simple and important steps you should take to make sure everything goes smoothly and in the right direction.

This article will walk you through all those steps in plain and simple language. No tricky terms, no stress just real talk and real steps that help you move forward with a clear head.

Understand What a Consumer Proposal Means

Before doing anything, it’s good to know what this is. A consumer proposal is a legal way to deal with your debts with the best consumer proposal company canada. You make a deal with the people you owe money to and pay a part of the total amount through easy monthly payments. The rest is cleared off once your proposal is done. It’s done with the help of a Licensed Insolvency Trustee, also called an LIT. They take care of talking to the creditors and preparing your file.

Check Your Full Money Picture

Make a simple list of everything. Include all your credit card balances, personal loans, store cards, taxes, or anything else you’ve borrowed. Just seeing it all written down can give you a full picture and help you stay calm. It’s not about panic—it’s about being clear.

Know What You Earn

Next, write down your total income. Include your salary, part-time work, or any other regular income like rental or family support. This helps you figure out what kind of payment plan will fit your budget without making life tough.

Know Your Spending

List your monthly expenses. Food, rent, transport, phone bill, kid’s school fees, anything that you regularly spend on. Try to see where your money goes. This step helps you figure out how much you can comfortably pay every month in your proposal.

Talk to a Licensed Insolvency Trustee (LIT)

Once you have your full picture, the next step is to talk to a Licensed Insolvency Trustee. These are the only professionals who can file a consumer proposal for you in Canada. The best part is, that your first meeting is usually free. You can ask anything, and they’ll guide you with respect and kindness.

They’ll look at your income, debt, and spending and help you come up with a payment plan that suits your life. And from that point on, they handle the communication with the creditors. So you won’t have to talk to anyone you owe money to—the trustee manages everything.

Know What a Proposal Can Include

Not all kinds of debt are treated the same. Most regular debts like credit cards, lines of credit, income tax debt, and personal loans can be added to your proposal. Things like child support or student loans less than 7 years old may not be part of it. Your trustee will clearly explain what’s included and what’s not, so there’s no confusion later.

Think About Your Goals

Ask yourself what you want. Do you want smaller monthly payments? Do you want to keep your house or your car while still paying what you can? Do you want to stop getting calls and letters about payments? All this is possible with a consumer proposal. If you know your personal goals, you can share them with your trustee and build a plan that fits your life properly.

Organize Your Papers

Having your documents ready can help speed up the process. You might need things like:

• Pay stubs or income proof
  
  

• Credit card and loan statements
  
  

• Rent or mortgage details
  
  

• Monthly bills like hydro, internet, or phone
  
  

• Your tax information
  
  

This is not a test or exam, so don’t stress if something is missing. Just bring what you have. The trustee will help you collect what’s needed.

Ask All Your Questions

This step is very important. Many people feel shy to ask questions, but this is your money and your future, so you should ask whatever you want. Ask about how long the proposal will last, what your monthly payment might look like, how it will affect your credit and anything else that’s on your mind. The more you understand, the more confident you’ll feel.

Talk With Your Family

It’s always good to involve your close ones in these kinds of decisions. You can talk to your spouse, partner, or even your parents if you feel comfortable. A little support and understanding from home can make everything feel lighter. If you share money matters with someone, like a joint loan, they can also be part of the proposal.

Think Long Term

Once your proposal starts, you’ll feel more relaxed. But it also helps to start thinking about the future. Maybe you want to build a small emergency fund, or slowly improve your credit score. Some people even start saving for a car or home once they’re halfway through the proposal. It gives you space to plan ahead.

Keep a Positive Attitude

This step is more from the heart than a checklist. Filing a consumer proposal is a smart and strong move. It shows you’re ready to fix things, not ignore them. And that kind of thinking always brings good results. Just take each step with calmness, trust the process, and know that many others have done it too and felt better after.

Stay in Touch With Your Trustee

Even after your proposal is filed, your trustee stays with you until everything is finished. If anything changes—like your income going up or down—or if you need a small change in your payment schedule, just let them know. They’re there to help, not to judge.

Final Thoughts

Getting ready to file a consumer proposal doesn’t have to be complicated. It just takes a little planning, the right help, and a calm mind. First, know your money situation. Then, talk to a trusted professional. Ask your questions, understand the plan, and move ahead with confidence.

It’s all about doing what’s best for you and your family. And once your proposal is accepted, you’ll feel lighter and more in control. It’s not about problems—it’s about solutions. This is one of the best ones Canada offers for people who want to take care of their money smartly and respectfully.