Compare your options
The three routes out of debt differ in what happens to your balance, what you keep, how long it takes and what it does to your credit. Here they are side by side.
The three options, line by line
Use the buttons to focus one option at a time.
| What to compare | Consumer proposal | Bankruptcy | Orderly Payment of DebtsFour provinces |
|---|---|---|---|
| What happens to your debt | You repay a portion of what you owe, commonly 30% to 70%. The remainder of the included unsecured debt is legally discharged at the end. | Most unsecured debts are eliminated entirely at discharge. | You repay the full balance, but at a fixed low interest rate rather than credit-card rates. |
| Your assets | Usually kept, including home equity, vehicle and savings, as long as you stay current on secured loans. | Non-exempt assets may be surrendered for the benefit of creditors. Essentials such as basic household goods and a modest vehicle are often protected under provincial exemption rules. | Generally kept, as long as you maintain payments on any secured debts. |
| Your payments | Fixed for the life of the proposal. They do not rise if your income increases. | Can rise if your income goes up, because of surplus-income rules. | One consolidated monthly payment, set from your income, household size and essential living expenses. |
| Interest | Interest stops entirely on the included debts. | The debts themselves are eliminated, so interest ends with them. | Fixed at a relatively low rate, often around 5% per year. |
| How long it lasts | Up to five years, with no penalty for paying it off early. | A first-time bankruptcy with no surplus income can be discharged in as little as about nine months. | Usually three to five years, until the balance plus fixed interest is repaid. |
| Credit impact | Generally reported at a lower severity than bankruptcy, and stays on your report for several years after completion. | A first-time bankruptcy is usually the most severe rating and can remain on your report for several years after discharge. | Appears on your report for a limited period after completion. You generally cannot take on new credit during the program. |
| Where it is available | Across Canada. | Across Canada. | Alberta, Saskatchewan, Nova Scotia and Prince Edward Island only. |
| Who files it | A Licensed Insolvency Trustee, and only an LIT. | A Licensed Insolvency Trustee, and only an LIT. | A provincially approved OPD administrator applies to the provincial court on your behalf. |
| Protection from creditors | A legal stay of proceedings stops most collection calls, lawsuits and wage garnishments once filed. | A legal stay of proceedings takes effect as soon as you file. | Once the consolidation order is granted, most collection actions and garnishments must stop. |
| Best suited to | People who can afford some repayment and want to keep their assets. | People with little or no capacity to repay who need the fastest route through. | People who could repay in full if interest were lower and payments were simplified. |
Which path might fit?
Five questions, about a minute. This points you at a likely starting place for the conversation. It is not an eligibility decision.
This is general information, not a determination of eligibility. Only a Licensed Insolvency Trustee can assess your situation and file a consumer proposal or bankruptcy. Wizdom Financial is not a Licensed Insolvency Trustee.
See the shape of each option
Enter roughly what you owe on unsecured debt. The bars show how the three routes tend to compare.
Excluding a mortgage on your principal residence.
An illustration only, not a quote or an offer. Real figures depend on your income, assets and what your creditors will accept, and creditors vote on every proposal. Only a Licensed Insolvency Trustee can assess your eligibility and file.
Get real numbers for your situationStill not sure which way to go?
That is the normal place to start. A free 30-minute conversation will narrow it down quickly.
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