Debt Relief in Ontario

If you’re dealing with overwhelming debt in Ontario, bankruptcy isn’t your only option. A Consumer Proposal, a Division 1 Proposal, Debt Settlement, or Business Debt Restructuring can all reduce what you owe and stop collection pressure. The right option depends on how much you owe, your income, and what you own.

Want to know how much debt we can reduce for you?

Answer a few quick questions to see what legal debt relief options may be available to you.

What is your rough debt load?

What kind of debt do you have?

Are you a homeowner?

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What Is Debt Relief in Ontario?

“Debt relief” isn’t one single program. It’s a set of legal tools that reduce, restructure, or resolve unsecured debt, things like credit cards, lines of credit, and personal loans. Each option below works differently and suits a different amount of debt.

What Types of Debt Qualify for Debt Relief in Ontario?

Credit Cards

Lines of Credit

Bank Loans

Payday Loans

Overdrafts

CRA Tax Debt

Student Loans (if out of school > 7 years)

Medical Debt

Personal Loans

Collection Agency Debt

Joint Debts

Business Credit (if personally guaranteed)

Debts NOT Included

Child Support

Spousal Support

Court Fines

Secured Loans (Mortgage, Car Loan)

Student Loans Under 7 Years

How the Process Works

Finding the right debt relief option is easier than most people expect.
Here’s how the process works when you do it with a law firm on your side:

Free, confidential consultation

We review your debts, income, expenses, assets, and goals to understand your situation.

We identify your legal options

Based on your total debt, we explain which paths apply: Consumer Proposal, Division 1 Proposal, Debt Settlement, or Business Debt Restructuring.

You choose the path that fits your goals

We explain the tradeoffs in plain language so you can decide with confidence.

We represent your legal interests

Where a formal proposal applies, we coordinate with a Licensed Insolvency Trustee, the only professional who can legally file it.

The legal process moves forward

Depending on the option chosen, this may include creditor voting, court approval, or direct negotiation.

Your debt is resolved

You move forward with a clear structure, whether that’s a reduced monthly payment or a completed settlement.

What are the Pros and Cons of Debt Relief in Ontario?

Pros

The benefits of a debt relief proposal

Reduce your debt significantly
Keep your home, car, and assets
Stop collections and lawsuits immediately
Stop wage garnishments
Avoid bankruptcy
One fixed monthly payment
Affordable and predictable
Government-regulated and legally binding

Cons

The disadvantages of a debt relief proposal

Appears on your credit report for the duration of the proposal + 3 years
Requires approval from creditors
Requires disciplined monthly payments
Not ideal for very high-income earners with surplus income
Must be filed through a Licensed Insolvency Trustee

Is Debt Relief the Right Option for Me?

Debt relief in Ontario might be right for you if:
You're struggling with monthly debt payments
You want to avoid bankruptcy
You want to keep your assets
You owe $10,000 or more in unsecured debt
You need predictable, stable monthly payments
You've been receiving collection calls or legal notices
Interest and penalties are making your debt impossible to manage

If your unsecured debt exceeds $250,000, or a business is involved, a Division 1 Proposal may be the better fit. Learn more about Division 1 Proposals. If a creditor is already garnishing your wages, see how we help clients stop wage garnishment in Ontario.

We reduce your debt. Not your dignity.

Debt Relief Ontario FAQs

01 What debt relief options are available in Ontario?

The main legal options are a Consumer Proposal, a Division 1 Proposal, and Debt Settlement. Each reduces or resolves unsecured debt in a different way, and the right one depends on how much you owe and what you're trying to achieve.

02 How do I know which debt relief option is right for me?

It depends on your total unsecured debt, your income, and whether you want the legal protection that comes with a formal proposal. A confidential consultation is the fastest way to find out which path fits your situation.

03 Is bankruptcy the only way to deal with debt in Ontario?

No. Consumer Proposals, Division 1 Proposals, and Debt Settlement are all legal alternatives that let you resolve debt without filing for bankruptcy.

04 How much debt do I need to qualify for a Consumer Proposal?

Consumer Proposals are available to individuals with $10,000 to $250,000 in unsecured debt. If your debt is higher than that, a Division 1 Proposal may apply instead.

05 What's the difference between a Licensed Insolvency Trustee and a debt lawyer?

A Licensed Insolvency Trustee is legally required to act impartially between you and your creditors. A debt lawyer, like our team at Metus Lykos, represents your legal interests only.

06 Will debt relief stop collection calls and wage garnishment?

Once a Consumer Proposal or Division 1 Proposal is filed, a legal stay of proceedings stops most collection actions, including wage garnishment.

07 How long does the process take?

A Consumer Proposal typically runs up to five years, with collection activity stopping shortly after it's filed. Debt Settlement moves faster, usually resolving in 30 to 120 days.

08 Can I keep my house if I go through a Consumer Proposal?

In most cases, yes. Your mortgage is a secured debt and isn't part of a Consumer Proposal, so you keep making mortgage payments as normal and keep your home.

09 What happens if my situation changes partway through?

Speak with us right away. Depending on what changes, your proposal terms, income, or timeline may need to be reviewed and adjusted.

Our Service Area

Real Debt Help, Wherever You Are in Ontario

Metus Lykos Debt Law Firm proudly serves clients across the entire province of Ontario. Wherever you call home, our lawyers are ready to review your situation and explain your legal options — confidentially, and free of judgment.

Toronto

Markham

Mississauga

Brampton

Ottawa

Hamilton

London

Windsor

Don't see your city listed? We work with clients across all of Ontario, in person and remotely. If you live in the province, we can help.

Take the First Step Toward Becoming Debt-Free

You don’t have to figure this out alone. Book a free, confidential consultation and let us walk you through your options, in plain language, with no pressure.