Quick answer: A consumer proposal doesn’t have a set price. Most Canadians repay roughly 20–40% of their unsecured debt through predictable monthly payments based on income, household needs, and overall debt level.
If debt is weighing you down, you may have already heard about a consumer proposal, a legal process under the Bankruptcy and Insolvency Act that lets you repay part of what you owe through a Licensed Insolvency Trustee (LIT).
It’s a steady, interest-free way to regain control, which naturally leads to one key question:
How much does a consumer proposal cost?
In this guide, we break down how consumer proposal cost is calculated, what’s included, what you can expect to repay, and why this federally regulated process is often the most affordable path to long-term debt relief.
Jump to:
- How much does a consumer proposal cost?
- How are consumer proposal payments calculated?
- What are the average consumer proposal costs by province?
- Consumer proposal costs vs bankruptcy costs
- What affects the cost of a consumer proposal?
- Are there any hidden costs or fees in a consumer proposal?
- Can you pay off a consumer proposal early?
- Are consumer proposals worth the cost?
How much does a consumer proposal cost?
There’s no one fixed cost for a consumer proposal, because each one is personalized to your individual income, debt level, and household budget.
However, most Canadians can expect to repay 20–40% of their total unsecured debt monthly over three to five years.
For example, if you owe $40,000 in credit cards and personal loans, your LIT might negotiate a $12,000 repayment plan, payable at about $200 per month for five years.
Once the final payment is made, the remaining balance is legally written off.
This payment includes everything: the trustee’s fees, government levies, and counseling sessions.
Did you know? The maximum duration for a consumer proposal is 5 years (or 60 months).
What’s included in the consumer proposal cost?
Here’s a breakdown of what’s included in the cost of your consumer proposal:
- Filing fee: This covers the official registration of your consumer proposal with the OSB.
- Trustee’s administration fee: Includes preparing documentation, creditor communication, and fund distribution.
- OSB levy: A small government fee for regulating insolvency services.
- x2 financial counselling sessions: These are mandatory meetings to help you rebuild your financial stability.
Unlike debt consultants or unlicensed agencies, a Licensed Insolvency Trustee doesn’t charge separate fees or commissions.
All costs are controlled by the Office of the Superintendent of Bankruptcy (OSB) and automatically deducted from your monthly payments.
How are consumer proposal payments calculated?
When calculating your consumer proposal costs, your LIT will use a few key factors to determine what you can reasonably afford:
- Total unsecured debt: Credit cards, personal loans, payday loans, and CRA tax debt.
- Household income: This determines what your creditors believe is a fair repayment over the course of your consumer proposal.
- Living expenses and dependents: Your LIT will make sure your budget covers all your essentials first and foremost.
- Asset value: If you have a home, car, RRSPs, or other assets, creditors may consider their equity value when it comes to your consumer proposal cost.
- Creditor expectations: Your creditors must see that they’re receiving more than they would through bankruptcy.
A Licensed Insolvency Trustee will review these factors with you during a free consultation, create a payment proposal, and submit it to creditors for approval.
If most creditors accept the proposal, it becomes legally binding for all. You’ll then make one fixed monthly payment to your trustee, who distributes funds to creditors.
What are the average consumer proposal costs by province?
While fees are federally regulated, average consumer proposal costs can vary slightly by province based on local income and the cost of living.
No matter where you live, Licensed Insolvency Trustee’s fees are identical, as they are federally set under the Bankruptcy & Insolvency Act (BIA) for fairness and transparency across all provinces.
Consumer proposal costs vs bankruptcy costs
It’s common to compare bankruptcy against consumer proposal costs, since both are legal debt solutions. The main difference is how payments are structured:
| Feature | Consumer Proposal | Bankruptcy |
| Upfront cost? | No | No |
| How much do you pay? | Based on income and assets | Based on surplus income |
| How long does it last? | 3–5 years | 9–21 months, up to 36 months if it’s a second+ bankruptcy |
| Do you keep your assets? | Yes | Some may be surrendered |
| What is the total cost? | ~20–40% of debt | Based on income & assets |
| How does it affect your credit rating? | R7 rating (3 years post completion) |
R9 rating (6 years post-discharge) |
In most cases, a consumer proposal costs less overall than bankruptcy for people with steady income or assets they want to protect. Bankruptcy also has a greater long-term impact on your credit and assets.
Rising debt and credit worries weighing you down? Take a moment to speak with one of our Licensed Insolvency Trustees for expert advice on what to do next.
Call free on 800-268-8093 or leave your details with us and we’ll be in touch.
What affects the cost of a consumer proposal?
Several personal and financial factors can influence your final consumer proposal payment amount:
Your total debt amount
The size of your unsecured debt has a direct influence on your consumer proposal cost. Higher balances usually lead to a larger overall repayment figure, but still far less than the full amount owed.
Your LIT will review every unsecured account you hold so the repayment offer reflects your full debt picture.
Your income level
Lenders expect a repayment that aligns with your household income. If you earn more, they may expect a higher monthly amount because your repayment ability is stronger. If your income is lower or inconsistent, your consumer proposal cost is adjusted.
Creditor negotiations
Most proposals are accepted as filed, but occasionally a creditor may ask for a small adjustment before agreeing. This could mean a slightly higher offer or a longer repayment term.
Your LIT will handle these discussions and will only recommend changes that still keep the consumer proposal realistic for your budget.
Your assets
While you keep your assets during a consumer proposal, creditors may still review whether you hold equity that would matter in a bankruptcy scenario.
If you have significant equity, they may expect the proposal amount to reflect that value. This helps show creditors they’re receiving more through the proposal than they would in bankruptcy.
Your family situation
Your monthly budget must account for your household’s real needs, including dependents, childcare, food, utilities, rent or mortgage costs, and transport.
The more essential expenses you have, the lower your available income for repayment. Your LIT will use this information to shape a proposal that fits your life, not the other way around.
Are there any hidden costs or fees in a consumer proposal?
There are no “hidden fees” included as part of the overall consumer proposal costs, but there are a few potential costs to keep in mind:
Missed payments
Falling behind on your consumer proposal payments can have serious consequences for the cost of your overall debt plan.
If you miss three payments, the proposal may be annulled, which means the full original debt is brought back, along with any collection activity that had been paused.
Credit impact
While not a direct financial charge, the R7 rating that appears on your credit report is a form of long-term cost to consider. It stays on your file for three years after you complete the proposal and may influence future borrowing.
The good news is that steady payments and completion of your proposal are positive steps that help you rebuild over time.
Can you pay off a consumer proposal early?
Yes, you can pay off a consumer proposal early—in fact, it’s encouraged. If your financial situation improves, you can pay off your proposal in a lump sum or larger monthly installments without penalty.
Paying off your consumer proposal early also helps remove the R7 credit notation faster, improving your credit profile sooner.
Are consumer proposals worth the cost?
Absolutely. A consumer proposal provides a clear, predictable repayment path while keeping your home, car, and savings intact. You’ll stop interest, wage garnishments, and creditor calls immediately, all for a cost that’s typically much lower than other debt settlement programs.
Because the Licensed Insolvency Trustee’s fees are built in, every dollar you pay goes toward resolving your debt legally and permanently.
When compared to bankruptcy, credit counseling, or debt consolidation loans, consumer proposals strike the best balance between affordability, protection, and recovery.
Book your free consumer proposal consultation now
At Harris & Partners, our Licensed Insolvency Trustees have supported thousands of Canadians through steady, realistic debt solutions grounded in federal regulation and clear guidance.
During your free, confidential consultation, we’ll review your situation, outline your consumer proposal cost, and build a repayment plan that fits your budget, all with no upfront fees. Book yours now.
