Consumer Proposal vs. Credit Counselling?

With all of the choices facing financial distressed consumers it’s important to compare your options. The following chart provides you with information to help you choose the debt repayment solution that best meets the needs of you and your family.   The most common options are a Consumer Proposals, only available through a federally licensed trustee in bankruptcy or a Debt Management/Repayment Plan offered by credit counselling agencies.

Consumer Proposal

Credit Counselling

% of Debt Repaid

Typically less than 40%


Interest Charges

All creditors legally required to stop interest.

Voluntary - creditors may or may not stop interest.

Monthly Payments

Based on income, family size and equity in assets.

Based on the amount of debt - no flexibility.


All administration costs are built into a monthly payment and are regulated by Federal Government.

Monthly program fees apply. Amounts vary by agency. Agencies get contributions from creditors based on collections.

Program Length

Must be completed within 60 months with the option to payoff early.

Between 36-60 months, however, interest charges not factored in.

Creditor Acceptance

Vote required. If 50% agree it's binding on all creditors.

100% agreement from each individual creditor required.

Income Taxes

Stop all interest/penalties.



stop interest/penalties.

Student Loans

If more than 7 years out of school, included in settlement with no interest.

Will NOT stop interest.

Legal Protection

Stops all collections and legal actions including wage garnishments.

Creditors who do not accept can continue collection activities.

Credit Reporting

R-7 Rating

R-7 Rating


Licensed by Federal government

Self regulated


Overseen by the Office of the Superintendent of Bankruptcy

Voluntary participation in association

 Professional Associations

CAIRP Code of Ethics & Rules of Professional Conduct

Varies from agency to agency.  CCC or CACCS.


On-going professional development requirements

Industry provided professional development

For a free consultation over the phone or in person in Saint John, Moncton, Fredericton or Charlottetown, please contact us.  Powell Associates Ltd. is a licensed insolvency trustee focused on providing debt settlement, proposal and bankruptcy solutions for individuals and businesses.