The number of consumer proposals filed in Ontario increased by an astounding 22% during the first six months of 2007, according to statistics just released by the Office of the Superintendent of Bankruptcy. The number of personal bankruptcies filed in Ontario increased by 5% in the first six months of this year (after falling by 4.5% last year).Why the moderate increase in bankruptcies, but the huge increase in consumer proposals?

No-one knows for sure, but based on my observations (our team talks to over 1,000 people in financial difficulty every month) I think there are a number of factors.

First, people are more aware of consumer proposals. At Hoyes Michalos we want everyone to consider all of their alternatives before filing for bankruptcy, and for many people a consumer proposal is the perfect solution. That’s why we talk about making a plan on our website, and why we talk about consumer proposals on the radio. I even recorded a short video about consumer proposals to explain how they work. (You can even see our videos on You Tube.) I believe that the more we talk about proposals, the more likely it is that people will learn about this great bankruptcy alternative.

Second, almost everyone who files a consumer proposal has a job, and many own a house, and they don’t want to risk losing their house, or a portion of their income, in a bankruptcy.

Finally, most people I meet want to pay their debts, they just need a bit of a break; that’s what they get with a consumer proposal: the ability to make one monthly payment to deal with their debts.

I predict that the number of people filing consumer proposals will continue to increase for the remainder of this year, as people look for a way to get a fresh start.

Want to learn more? Research your options (check out our top 50 questions and answers, and then fill out our bankruptcy evaluation form, or send us an e-mail, or call us today to set up a free, no obligation initial consultation, and let’s get started.