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Mortgage Squad Advisors
Consumer Proposal

Mortgage After a Consumer Proposal in Canada — Active & Discharged Options

Yes — sooner than you think. Whether your proposal is active or discharged, there's a path: specialty B-lenders and private capital fund active files, discharged files open wider B-lender options, and A-lender pricing comes back as your credit re-establishes.

Active OK (B/private)Discharged → wider BPath back to ARe-establish creditEarly payout option100% confidential
5-star rated| FSRA #13737| 5-min pre-qualification

Written by the Mortgage Squad Advisors Editorial Team · Reviewed by Surrayya Afzal, Principal Broker, FSRA #13737 · Updated August 2026 · Reviewed quarterly; next review November 2026

In or past a consumer proposal?
There is a real path back. No judgment.
Whether you're still making payments or already discharged, we work with lenders who'll help you rebuild — and we show you exactly how to get back to a Big-6 bank.
Your path backActive
ActiveDischarged+12 mo clean+24-36 mo clean
Specialty B + private
20-35%
Down (active)
5-10%
Down (discharged)
2-3 yrs
To A-lender (post-disc)
Private
Confidential handling
Get pre-approved Affordability
Maya · AI · 24/7
I have a consumer proposal — when can I get a mortgage?
5-star rated| FSRA #13737| 50+ languages

Many Canadians in or after a consumer proposal are told by their bank they’ll have to wait years before a mortgage is possible — but that’s not the whole picture. What’s realistic depends on your stage and your file, not a single rule. Active proposals can often be financed today through specialty B-lenders and private capital. Discharged proposals open up B-lender options, and A-lender pricing typically returns as you re-establish credit over the following couple of years. The path back is real, and starting it sooner is almost always better than waiting.

The short answer

You can get a mortgage after a consumer proposal — and often during one. What's realistic depends on your stage (active vs discharged), your re-established credit, income, equity and property. Active proposals are typically B-lender or private files; discharged proposals open wider B-lender options, with A-lender pricing returning as your credit rebuilds. Figures on this page are illustrative and lender/file-dependent — not guarantees.

What is a consumer proposal — and can you get a mortgage with one?

A consumer proposal is a legally binding agreement, filed through a Licensed Insolvency Trustee, to repay creditors part of what you owe (usually over up to five years) — a formal alternative to bankruptcy. You can often get a mortgage during an active proposal through specialty B-lenders or private capital, and more options open once it’s discharged. What’s possible depends on your stage, credit, income, equity and property.

What you get

Why Canadians choose Mortgage Squad Advisors.

Active consumer proposal financing via specialty B-lenders and private capital
Discharged proposal: refinance, purchase, or HELOC options widen at B-lenders
Re-establishing 2+ reporting trade lines (12+ months clean) is what moves lenders
Private mortgage option for equity-based files at any proposal stage
Up to ~80% LTV on alt-A; ~65-75% on private (illustrative)*
Lower down payments become possible post-discharge with insurer approval*
A mapped plan back to A-lender pricing as your credit re-establishes
No judgment — a proposal is a financial recovery tool, not a moral failing
Discreet handling — your file and our conversations stay confidential
All lender + broker fees disclosed in writing upfront
Instant check · no credit pull

Your path back to a mortgage

Tell us where you are — we'll map the realistic timeline and the exit to A-lender pricing.

Situation
Status
19 months
Time since discharge
B-lenders — with 2 clean re-established tradelines
Where you stand today
~5 months
Estimated time to A-lender pricing

Re-establish 2 clean tradelines (secured card + small loan), reported on time, utilization under 30% — that’s what moves your score toward the A-lender exit.

Estimate only — not an approval. This is a simplified guide based on typical timelines. Your actual path depends on your full credit rebuild, income, equity and each lender’s and insurer’s own criteria, and is subject to lender review.

Estimates only — a licensed advisor confirms your file. FSRA #13737.

Or ask Maya directly:

Do I qualify for a post-proposal mortgage?What documents will I need?How fast can this close?
Maya · 24/7 AI advisor

Question about post-proposal mortgage? Maya answers instantly in 50+ languages.

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How it works

Three simple steps, no pressure.

1

File snapshot

Date of filing, expected or actual discharge date, and your current re-established credit (trade lines reporting, payment history). We map your options, usually within 24 hours — no bureau pull required to begin.

2

Match the lender

Active proposal: a specialty B-lender or private capital. Discharged: a wider B-lender pool, and potentially an A-lender once you’re enough months post-discharge with clean re-established credit. We aim for the cheapest path that fits your file.

3

Plan the path forward

We set a refinance-trigger target and monitor your credit recovery, then re-shop when you cross each milestone — many clients can move from B toward A within roughly 24-30 months of discharge, depending on their rebuild and lender criteria.

Run the math first

Active vs. discharged: how your mortgage options change by stage

Where you are in the proposal lifecycle changes the lender list, the down payment, the rate and the likely options. Every figure below is illustrative and lender/file-dependent — not a quote or a guarantee.

Consumer proposal mortgage options compared across active, recently discharged, and 24–36+ months post-discharge, by lender type, down payment, rate, credit requirement and likely options.
FactorActive proposalRecently discharged24–36+ months post-discharge
Lender typeSpecialty B-lenders + privateWider B-lender poolB-lenders, and eventually A-lenders
Down payment*Higher — commonly ~20–35%Commonly ~10–20%As low as ~5–10% with insurer approval
Rate*B-lender premium or equity-based privateB-lender premium over AMoving toward A-lender pricing as you qualify
Credit requirementCurrent on proposal payments + a reporting trade lineRe-established credit actively building2+ clean trade lines seasoned ~12+ months
Likely optionsPurchase or refinance via specialty B or privateRefinance, purchase or HELOC at a B-lenderInsured A-lender purchase becomes realistic

*Down payments, rates and timelines are typical/illustrative, vary by lender, insurer and file, and are subject to lender review — not guaranteed outcomes. Private single-family average sourced to CMHC; A/B ranges are our rate desk’s read (basis).

Can you get a mortgage while still in a consumer proposal?

Often, yes. A consumer proposal is a legal arrangement filed through a Licensed Insolvency Trustee — not a bankruptcy — and a narrow set of specialty B-lenders, plus private capital, will consider funding you mid-proposal once you can show you’re current on your trustee payments.

The trade-off is structure, not an automatic refusal. Expect a higher down payment (commonly ~20–35%), a rate premium on a B-lender file or equity-based pricing on a private, and a lender that wants proof the proposal is being serviced and that you’ve re-established at least one reporting trade line. A-lenders are generally the exception — most want the proposal paid out, discharged, and your credit rebuilt first — so an active file is usually a B or private placement. All figures here are illustrative and depend on the lender and your file.

The point of taking an alternative mortgage now is to leave it. We map the A-lender exit from day one, with a target trigger — not an open-ended commitment to premium pricing.

How you qualify: the factors that actually decide your file

Approval on a proposal file turns on a handful of factors, and knowing where you stand on each tells you what’s realistic. Proposal status (active vs discharged) and your discharge date set the lender list. Re-established credit — ideally two or more trade lines reporting clean for 12+ months, with low balances — is what moves a lender from no to yes. Income and debt service still have to support the payment. And because much of this is equity-based, property value, your existing mortgage and remaining equity often matter more than credit on a private file.

No single factor decides it, and none of these is a guaranteed threshold — lenders and insurers each set their own criteria and review every file. What we do is read your file against the lenders most likely to approve it, and tell you honestly what stage you’re at.

Paying out your consumer proposal early with home equity — the math

If you own a home with equity, refinancing to settle your proposal early can be the fastest route back to prime — but only when the numbers work, so here’s the framework to check it. Start with your home value and subtract your existing mortgage to find your equity. The most an alternative lender will typically advance is about 80% of value at alt-A or 65–75% on private*, so calculate the refinance amount available above your current balance. From that, subtract the proposal payout (the amount to settle in full through your trustee) and the fees (lender, broker, legal). What’s left is your remaining equity — and the exercise only makes sense if the refinance still leaves you with a sensible cushion.

The upside: settling the proposal completes it, the discharge clock starts immediately, and a 60-month term can compress to the time it took to close — accelerating your path to A-lender refinancing. The premium you carry on a short alternative mortgage is often less than years of premium pricing while a proposal runs its full term. But it is not universally worth it: if the payout eats most of your equity, or your credit rebuild is the real bottleneck, waiting can be smarter. We model the full lifecycle so the decision is numbers, not a pitch, and we won’t recommend a payout that doesn’t measurably improve your timeline.

The exit strategy: your roadmap back to A-lender pricing

An alternative mortgage only works if it ends, so the exit is planned on day one — as a roadmap with milestones and conditions, not a fixed promise. The conditions that reopen A-lender pricing are consistent: the proposal is completed or discharged; you’ve re-established credit (typically two or more trade lines reporting clean for 12+ months, low utilization); your income and ratios support the file; and enough time has passed since discharge — many A-lenders look for roughly two years, though this varies by lender and by whether the proposal has aged off your bureau.

The rebuild is concrete: open a secured credit card (several banks and issuers offer them) and use it monthly, paying the full balance each cycle; after 6–12 months of clean reporting, add a second trade line so two accounts season at once; keep utilization low. We set a refinance-trigger target when we place your first mortgage, monitor your recovery, and re-shop the moment you qualify for better — the mapped exit is the product, not just the initial approval.

Self-employed and in a consumer proposal

Self-employed borrowers in or after a proposal face two overlapping challenges — the proposal and income that doesn’t show cleanly on a T4 — and the good news is that the same alternative lenders solve both. B-lenders and private lenders that work proposal files also accept self-employed and stated income, so a business-for-self borrower isn’t doubly penalized. The file is read on your real income and your equity rather than on line 150 alone.

Documentation still matters — business financials, bank statements, and evidence you’re current on the proposal — but the combination is very much fundable. See our self-employed mortgage playbook for how we layer business income, and we’ll fit it to the proposal-friendly lenders on the same file.

Which lenders finance a consumer proposal — and in what order?

Think of it as a ladder, and the goal is to climb it. A-lenders sit at the top — prime pricing, insured options — but they generally require the proposal paid, discharged, and credit re-established for roughly two years. That’s the destination, not usually the entry point. B-lenders are the workhorses for proposal files: a narrow set of specialty B-lenders will fund during an active proposal, and the pool widens considerably once you’re discharged, at a rate premium over A-lender pricing plus a lender fee.basis

Private lenders sit at the bottom of the ladder but fund the fastest — they’re equity-based, care less about the proposal itself, and can fund at any stage. Industry-wide, private lenders averaged about 9.6% on single-family files in Q3 2025.CMHC With access to 100+ lenders including B and private, we place you on the lowest-cost rung that approves today, then move you up. See the wider alternative lending ladder and our dedicated B-lender page.

“I had a consumer proposal two years ago and assumed no one would touch me. My advisor never made me feel judged — just helped me find a path forward. We closed in 10 days through a B-lender. They mapped the refinance to A-lender pricing in 18 months as part of the plan from day one.”

— David M., Toronto, ON · B-lender · 10 days · A-exit planned

“Beacon was 580 after a divorce-driven hit to my credit. The team got me a B-lender mortgage to purchase, gave me a credit-rebuild plan, and 16 months later refinanced me to an A-lender at 4.49%. The interim cost was real but the long-term math was worth it.”

— Samantha R., Hamilton, ON · Beacon 580 → A-rate in 16 months

Names and identifying details are anonymized to protect client privacy. Each quote reflects a real type of file we have funded; figures are typical results for that kind of file, not a guarantee of your outcome.

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FAQ

Common questions, answered.

Don’t see yours? Ask Maya — instant answer, any time.

Active vs discharged — what’s the difference for lenders?
Active means a much narrower lender list (specialty B-lenders and private). Discharged means the options widen. Roughly two to three years post-discharge, with clean re-established credit (commonly 2+ trade lines reporting 12+ months), A-lenders become realistic — though timelines vary by lender and file. Discharge alone usually isn’t enough; re-establishing credit is what moves lenders from no to yes.
Can I buy a home with an active consumer proposal?
Often yes, through specialty financing. Expect a higher down payment (commonly ~20–35%), a rate premium over A-lender pricing, and a requirement to show you’re current on your proposal payments.basis Figures are illustrative and lender-dependent. Many files do better waiting until after discharge if there’s no immediate purchase pressure — we’ll tell you honestly which applies to you.
How much down payment do I need?
It depends on stage and lender, and these are illustrative: active proposal commonly ~20–35%; recently discharged ~10–20%; further post-discharge with clean re-established credit, as low as ~5–10% at certain B-lenders with insurer approval. Private files are equity-based, commonly ~25–35% down. Insurer and lender criteria change, so we confirm what’s currently available for your file.
Will the proposal stay on my credit report after discharge?
Generally, yes, for a few years. At Equifax a consumer proposal typically stays about three years after it’s completed; at TransUnion about three years after completion or six years from filing, whichever is earlier.bureaus Bureau treatment can vary, so check your own report. What matters most to lenders is that it’s completed and that you’ve re-established clean credit.
Is a consumer proposal private, or is there a public record?
It’s confidential in practice but not entirely private. Your employer isn’t notified and it isn’t published in newspapers — but it’s reported to the credit bureaus and your creditors, and it’s recorded in the federal Office of the Superintendent of Bankruptcy’s insolvency registry, which anyone can search for a fee.OSB Your conversations with us are confidential.
Can I refinance to pay out my proposal early?
Sometimes — if you have enough home equity and a lender comfortable with the active proposal. Settling it early completes the proposal, starts the discharge clock, and can put you on the path to A-lender pricing faster. But it only makes sense if the math works and it doesn’t drain your equity — we model equity → refinance amount → payout → fees → remaining equity → projected exit before recommending it.
What’s the cost premium on a post-proposal mortgage?
More than a bank, deliberately and temporarily. Illustratively, a B-lender prices above A-lender rates plus about a 1% lender fee; private averaged about 9.6% for single-family files in Q3 2025 per CMHC, plus lender and broker fees.CMHC Refinancing back to A-lender pricing after discharge often saves more over a 5-year term than the premium you pay during recovery. We model the full lifecycle so you see the real number.
How do I re-establish credit during and after a proposal?
Open a secured credit card (several banks and issuers offer them) and use it monthly, paying the full balance every cycle. After 6–12 months of clean reporting, add a second trade line so two accounts season at once, and keep utilization low (ideally under 30%). Consistent clean reporting over a couple of years makes you a substantially more financeable borrower — we coach this on every file.
Does my spouse’s proposal affect me?
Only if you co-borrow. A joint mortgage pulls both bureaus, so a spouse’s proposal affects a joint qualification. Where it makes sense, we can structure a single-borrower deal (one name on title and mortgage), which requires the qualifying borrower to carry the file on their own income.
How fast can a proposal mortgage close?
A private file can often fund within days once an appraisal is done and the lawyer is instructed; a B-lender file typically takes a few weeks. Timelines vary by lender and file. If you have a firm closing date, tell us early so we can match a lender that meets it.
What if I had a bankruptcy that became a proposal, or vice versa?
Lenders look at the most recent insolvency event for timing. A bankruptcy converted to a proposal has the proposal as the operative event; a discharged bankruptcy followed by a discharged proposal stacks the recovery timeline. With strong re-establishment, the path back to A-lender pricing still opens — we map the exact timeline on your file. See also mortgage after bankruptcy.

Related products

Mortgage during an active proposalBuy a house after a proposalRefinance after a proposalBad credit mortgagePrivate mortgageB-lender mortgageAlternative lending (overview)Mortgage after bankruptcySelf-employed mortgageCRA debt mortgageAffordability calculatorGuide: how long after a proposal?Guide: active vs dischargedGuide: pay off with home equityGuide: rebuild creditCase study: approved 14 months after a proposalCase study: early payout with equityCase study: self-employed + proposal

Sources & references

Figures on this page are sourced below and re-checked each quarter. Rates, insurer rules and lender policies change — confirm anything you plan to act on with a licensed advisor.

  1. 1. Canada Mortgage and Housing Corporation (CMHC), Residential Mortgage Industry Report (Q3 2025) — Average interest rate on single-family private mortgages was approximately 9.6% in Q3 2025.
  2. 2. Mortgage Squad Advisors rate desk (internal verification), Illustrative A-lender / B-lender pricing and LTV ranges (reviewed August 2026) — B-lender proposal files typically price above A-lender rates plus about a 1% lender fee; down payments and LTV vary by stage, lender and insurer. Illustrative, not a quote — live A-lender pricing is on our rates page.
  3. 3. Equifax Canada / TransUnion Canada, How long a consumer proposal stays on your credit report (accessed August 2026) — A consumer proposal generally remains on your credit report for about three years after it is paid/completed at Equifax, and at TransUnion for about three years after completion or six years from the filing date, whichever is earlier — confirm your own report, as bureau treatment can vary.
  4. 4. Office of the Superintendent of Bankruptcy (OSB), Government of Canada, Insolvency records — search (accessed August 2026) — Consumer proposals are recorded in the OSB's national insolvency records, which can be searched by anyone for a fee — so a proposal is confidential in practice but not entirely a 'no public record' matter.

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