How Long Does a Consumer Proposal Stay on a Credit Report

How Long Does a Consumer Proposal Stay on a Credit Report

rebuild your worth, book a free consultation todayBook Now

By Bromwich+Smith Staff | 1325 words | Reading Time: 6 minutes, 36 Seconds | Date: 2024/03/05

How long does a Consumer Proposal stay on your credit report? That’s a great question. Let’s start with some definitions. 

Defining a Consumer Proposal 

A Consumer Proposal is a legally binding agreement between you and your creditors to pay a reduced amount of the debts you owe within five years. Because it is governed by the Bankruptcy and Insolvency Act of Canada, a Consumer Proposal must be administered by a Licensed Insolvency Trustee

A Consumer Proposal can be an excellent solution to conquering your debt, bringing an end to creditor actions and the accumulation of interest. It is reported to the credit bureaus, causing a negative impact on your credit rating.  

Defining a Credit Rating 

A credit rating is an estimate of how well a person meets their financial commitments, according to their payment history and current debt status. Creditors, like your credit card company, utilities, or cell phone company, provide information to the credit bureau companies (Equifax and TransUnion) that then gets combined in a credit report. When you apply for more credit, like a car loan, mortgage, or new credit card, the creditor you apply to then looks at your credit report to decide if you qualify. 

How Long Will a Consumer Proposal Stay on my Credit Report? 

The fact that you entered into a Consumer Proposal should be removed from your Equifax and TransUnion credit reports 3 years after you've paid off all your debts according to the proposal, or 6 years from the date it was filed, whichever comes first. This means that the faster you fulfill the expectations of the consumer proposal and pay it off, the sooner it comes off. Alternatively, it will stay on your report for six years from the date that you file, whichever option comes first. 

What is the financial debt recovery process? 

The financial debt recovery process moves you from overwhelming debt to a debt-free life. It all starts when you reach out for help, which we understand can be difficult. Start by learning about debt relief options (which you’ve already begun). While there are lots of excellent resources online (like this blog), you may decide to get professional advice. In that case, we suggest looking at their rating on the Better Business Bureau and Google reviews. Licensed Insolvency Trustees, like Bromwich+Smith, will provide a no cost, no obligation consultation.  

Is a Consumer Proposal Right for me? 

Every situation is different and unique, and the world of debt relief can feel overwhelming. A Licensed Insolvency Trustee will listen to your story, talk through some options, and help you find the best solution, even if it’s not something we provide. In the meantime, please find the benefits of a consumer proposal below. 

Click to Book A Free Consultation

Consumer Proposal Benefits: 

  • Settle your debt based on what you can afford, not what creditors were demanding. 

  • Stops all creditor actions, including collection calls and wage garnishees. 

  • Legally force creditors into the settlement, even if they don’t all agree. 

  • Stop interest charges immediately. 

  • Make one monthly payment, with up to 5 years to pay. 

  • Doesn’t involve your possessions. 

  • No additional fee payments from you, as we are paid by a government tariff included in your monthly payments. 

Will a Consumer Proposal affect my mortgage? 

Significant information about how you handle credit, including late payments and a  Consumer Proposal, is reported to the credit bureaus. This has the potential to impact your approval for a new mortgage. Here's how: 

  1. Credit Impact: 

  • A Consumer Proposal will be reported on your credit report, and it will have a negative impact on your credit score. This impact can make it more difficult to qualify for a mortgage- though it is not always the case. Your Licensed Insolvency Trustee will be able to help you navigate lenders who have less strict requirements, or who traditionally work with clients in a Consumer Proposal program.   

  1. Credit History: 

  • Once filed, a Consumer Proposal will remain on your credit report for a specified period (usually up to 3 years after completion).  

  1. Higher Interest Rates: 

  • Even if you qualify for a mortgage, you may be approved for a loan with higher interest rates. Lenders may perceive you as a higher-risk borrower, and they may charge higher rates to compensate for the perceived risk to them. 

  1. Limited Mortgage Options: 

  • Some traditional lenders may be uncertain approving a mortgage for individuals with recent Consumer Proposals. In such cases, you may need to explore alternative lenders or mortgage products. 

  1. Down Payment Requirements: 

  • Lenders may require a larger down payment from individuals with Consumer Proposals to mitigate risk.  


Before applying for a mortgage, speak to a mortgage professional who can assess your specific situation, guide you through the process, and help you understand the options available based on your financial history and goals.  

Click to Book A Free Consultation

How can I increase my credit score after a Consumer Proposal? 

Rebuilding your credit after a Consumer Proposal is absolutely possible. It just requires commitment and consistency. While a Consumer Proposal will have a negative impact on your credit score, you can take proactive steps to help improve your creditworthiness over time. These strategies include: 

  1. Understanding your credit report. Obtain a copy of your credit report and review it carefully to ensure accuracy to have and to have a full understanding of what is in your credit report. If there are inaccuracies, talk to the reporting creditor to have it corrected. 

  2. Creating and staying within a budget. By developing a realistic budget that includes your income, expenses, and debt repayment, you will be able to prioritize payments, avoid late charges and pave the way to a brighter financial future. 

  3. Generate an emergency fund. A dedicated savings account as an emergency fund will help you cover expenses during any crisis that may arise. Those savings will prevent you from relying on credit and accumulating additional costs in the future. 

  4. Using secured credit. Consider using a secured credit card or secured loan in which you provide a deposit or collateral. 

  5. Pay all your bills on time. Timely payments will have a positive impact on your credit history and showcase your creditworthiness to future lenders. 

  6. Keep balances low. If you have an unsecured credit card, keeping the balance low will demonstrate responsible credit utilization and positively influence your credit score. 

  7. Limit new credit. Avoid applying for credit unnecessarily as each new application is registered on your credit report and reduces your credit score. 

  8. Have patience. With consistency and commitment, your credit score will increase, it will just take some time. 

  9. Seek professional advice. If you are struggling, ask for a no cost, no obligation consultation from a professional like a Licensed Insolvency Trustee

For a free, compassionate, and personalized consultation, call Bromwich+Smith at 1.855.884.9243, Live Chat   or visit


1: How long does a Consumer Proposal stay on a credit report?

The information about a Consumer Proposal remains on Equifax and TransUnion credit reports for 3 years after full debt repayment or 6 years from the filing date, whichever comes first.

2: How can I increase my credit score after a Consumer Proposal?

To rebuild credit, review and correct inaccuracies in your credit report, create a budget, establish an emergency fund, use secured credit, pay bills on time, keep balances low, limit new credit applications, have patience, and seek professional advice if needed.

3: How does a Consumer Proposal impact credit rating?

A Consumer Proposal will have a short term negative impact on your credit rating as it is reported to Equifax and TransUnion. However, fulfilling the proposal's expectations and timely debt repayment can mitigate the impact over time.

4: What is the debt recovery process?

The financial debt recovery process involves seeking professional advice, exploring debt relief options, and reaching out to Licensed Insolvency Trustees, like Bromwich+Smith, for a no-cost consultation to discuss personalized solutions.

5: Can a Consumer Proposal affect my credit history?

Yes, a Consumer Proposal remains on your credit report for a specified period, usually up to 3 years after completion, impacting your credit history. However, its influence lessens over time and filing for a Consumer Proposal allows you the ability to start fresh and rebuild your credit.

6: How does a Consumer Proposal handle interest charges?

A Consumer Proposal stops interest charges immediately upon acceptance, providing relief by allowing individuals to settle their debts based on what they can afford without accumulating additional interest.

Add new comment

Plain text