Getting a Mortgage After a Consumer Proposal in Ontario (2026)

A consumer proposal is one of the smartest ways to deal with overwhelming debt — but a lot of people assume it locks them out of homeownership for years. It doesn't. In Ontario you can often get a mortgage while still in a proposal, and the path to a great rate opens up quickly once it's paid off and discharged.

The short answer

You can get a mortgage during an active consumer proposal through alternative (B) and private lenders, and you can qualify for a prime (A-lender) mortgage typically within about two years of the proposal being discharged and your credit rebuilt. The bigger your down payment or home equity, the more options you have at every stage. See mortgage-after-consumer-proposal options.

Buying or refinancing while still in a proposal

A-lenders generally won't fund a mortgage until a proposal is paid in full and discharged. But B-lenders and private lenders will, because they weigh your down payment, your income, and the property more heavily than the proposal itself. Expect a higher rate and usually a larger down payment (often 20%+), with the plan being to refinance to a prime lender once you're discharged and re-established. If you already own a home, the same logic applies to a refinance or second mortgage against your equity.

What changes once you're discharged

Discharge is the turning point. Once your proposal is paid and you have your Certificate of Full Performance, the clock starts on re-establishing credit. Prime lenders typically want to see roughly two years of clean, re-built credit after discharge — two active trade lines (a credit card and a small loan or line), every payment on time, balances kept low. Hit that and you're competing for the same rates as anyone else.

How to qualify faster

• Rebuild two trade lines. A secured credit card plus a small RRSP or installment loan, paid perfectly, rebuilds a score fast. (More in how to rebuild credit for a mortgage.)
• Grow your down payment. 20% or more moves you out of insured-mortgage rules and widens your lender list.
• Keep income stable. Time in the same job or business reassures every lender.
• Get the proposal paid early if you can. Discharge starts the re-establishment clock sooner.

Consumer proposal vs. bankruptcy for future borrowing

A consumer proposal is generally gentler on your future mortgage prospects than bankruptcy — it avoids a formal bankruptcy on your record and the waiting periods are usually shorter. If you're weighing the two, or recovering from a past bankruptcy, see getting a mortgage after bankruptcy.

Frequently asked questions

Can I get a mortgage while in a consumer proposal?

Yes — through alternative or private lenders, usually with a higher rate and a larger down payment. Prime banks generally wait until the proposal is discharged.

How long after a consumer proposal can I get a normal mortgage?

Typically about two years after discharge, provided you've re-established two clean trade lines with on-time payments. A strong down payment can shorten the practical wait.

Does a consumer proposal show on my credit report forever?

No. A consumer proposal generally drops off your credit report about three years after you complete it (or six years from filing, whichever comes first). Rebuilt credit on top of it is what lenders look at.

Should I pay off my proposal early to buy a home?

Often, yes — discharge starts the credit re-establishment clock that prime lenders care about. A broker can tell you whether early payout or building your down payment gets you there faster.

In a proposal and want to own? Explore mortgage options after a consumer proposal or talk to us confidentially — we'll map the fastest route to a prime rate.