Why is a consumer proposal a good bankruptcy alternative?

Short answer: you are in control

In a consumer proposal you are in control of your future. Once your creditors accept your proposal, you make one affordable monthly payment, and your debts are discharged. You know exactly what you are required to pay each month. Consumer proposals are a proactive solution to your debt problems.

If you go bankrupt, the amount you are required to pay each month is adjusted based on your surplus income. The more you earn, the more you pay. For example, if you start working overtime while bankrupt, you pay more. In a proposal, if you work overtime, your payment remains the same; it doesn't change.

In a bankruptcy, you lose your tax refund. In a consumer proposal, you keep your tax refund, so you are in control of what happens to your refund. You could choose to use the refund to make an advance payment to pay off your proposal quicker, or you could save the money for future emergencies. It's your choice. With a consumer proposal, you are in control.

Here is a video that explains in more detail the difference between a consumer proposal and personal bankruptcy in Canada:

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