Average consumer debt levels have increased across the country over the last 12 months by an average of 3.2%. The average debt amount in Canada in 2019, excluding mortgages, is currently around $23,500.

While this is indeed troubling, several provinces currently are above the national average and unfortunately Alberta leads the country with the average debt load of over $29,000, 24% above the national average. While this is down from earlier in the decade, it has caused one of the highest insolvency increases in the country.

This rapid increase is cause for alarm, especially since the greater one’s debt, the more difficult it is to pay it off. Interest charges rise on growing consumer debt levels, and many residents are finding themselves unable to meet their minimum consumer debt payments. There are many solutions, however, to help you get your debt under control, including the consumer proposal. Alberta residents who are struggling to pay their bills may want to consider this debt payment option.
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Insolvency & Consumer Proposal Statistics in Alberta

  Alberta Nationwide
  Insolvency Consumer Proposal Insolvency Consumer Proposal
Q4 2021 3,457 2,806 22,999 15,928
Q3 2021 3,268 2,670 21,649 14,909
Q2 2021 3,706 2,937 23,497 15,696
Q1 2021 3,632 2,851 23,824 16,504
Q4 2020 3,228 2,428 23,364 15,509
Q3 2020 2,779 1,984 20,692 13,350
Q2 2020 2,726 1,985 19,151 12,741
Q1 2020 4,296 3,090 33,212 21,769
Q4 2019 4,286 2,917 35,139 21,613
Q3 2019 4,215 2,819 34,690 20,937

Source: https://www.ic.gc.ca/

What Is an Alberta Consumer Proposal?

A consumer proposal is an agreement made on your behalf with your creditors to settle your debts and create a schedule to pay them off. Consumer proposals are binding legal agreements that clear much of what you owe and set you up with an affordable way to pay the amount of debt your creditors have not forgiven. To qualify for a consumer proposal in Alberta, you must:

• be unable (for any reason) to make your payments as they become due, or you stop making your payments as they come due

• owe less than $250,000 to your creditors ($500,000 for married couples)

• have an insufficient amount of assets that can be used to satisfy your debt

• hire a licensed bankruptcy trustee to mediate with creditors on your behalf

An approved consumer proposal becomes binding on all your creditors if creditors representing at least 51 percent of your total indebtedness agree to the plan.

Alberta Consumer Proposal Pros and Cons

Pros

  • The fees and other costs associated with a consumer proposal are far less than those associated with bankruptcy for many Canadians.
  • Debt collectors will stop harassing you when you sign a consumer proposal.
  • Your physical assets are protected in a consumer proposal.
  • A consumer proposal forces obstinate creditors to work with you when lenders representing 51% of your debt agree to the plan.

Cons

  • Though more affordable than a bankruptcy, a consumer proposal has the same negative effect on your credit as a bankruptcy, and it remains on your credit report for up to seven years.
  • If 51 percent of your creditors deny the proposal, it does not go into effect.
  • Bankruptcy trustees are required to pay your creditors as much as possible.

Find Out More about a Consumer Proposal in Alberta

You should know that a consumer proposal is not the only option for settling your debt for less than what you owe.

In fact, a quality debt settlement program or credit counselling can provide many of the same results without as negative an impact on your credit. Fill out the quick debt relief form for more information and find out whether or not a consumer proposal is right for you.

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Annual Consumer Insolvency Rates in Alberta

(Per 1,000 Population Aged 18 Years and Older)

Alberta
’11 ’12 ’13 ’14 ’15 ’16 ’17 ’18 ’19 ’20
Insolvency 3.5 3.1 2.7 2.6 3.1 4.0 4.0 4.4 4.9 3.8
Proposal 1.0 1.2 1.2 1.4 1.7 2.4 2.5 2.9 3.3 2.8
Lethbridge – Medicine Hat
Insolvency 4.4 3.6 3.5 3.8 4.4 5.3 4.2 5.0 5.8 4.4
Proposal 1.2 1.3 1.3 2.1 2.5 3.1 2.5 3.3 4.0 3.5
Camrose – Drumheller
Insolvency 2.8 2.8 2.0 2.1 2.9 3.9 3.7 3.3 4.0 3.1
Proposal 0.8 0.9 0.7 1.0 1.4 1.9 2.0 1.9 2.5 1.9
Calgary
Insolvency 3.5 3.4 2.8 2.6 3.0 3.8 4.0 4.3 4.7 3.5
Proposal 0.9 1.2 1.2 1.5 1.8 2.5 2.6 2.8 3.0 2.5
Red Deer
Insolvency 3.7 3.2 3.5 3.6 4.6 6.4 5.1 5.4 6.5 5.1
Proposal 1.2 1.4 1.6 1.9 2.9 3.9 3.1 3.7 4.6 3.7
Edmonton
Insolvency 3.5 3.0 2.7 2.5 2.7 3.7 4.1 4.4 5.0 3.9
Proposal 1.2 1.3 1.3 1.3 1.5 2.1 2.6 3.0 3.4 2.9
Wood Buffalo – Cold Lake
Insolvency 1.9 1.9 1.4 3.1 3.1 3.0 3.5 4.9 6.4 5.2
Proposal 0.7 0.8 0.7 1.4 1.6 1.5 2.0 3.2 4.4 3.8
Banff – Jasper – Rocky Mountain House and Athabasca – Grande Prairie – Peace River
Insolvency 2.4 2.9 4.4 3.7 3.8 4.3 3.5
Proposal 1.1 1.3 2.3 2.0 2.4 2.7 2.4

Source: https://www.ic.gc.ca/
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