Is a consumer proposal still an option to deal with tax debt to CRA if CRA have a lien against your house (but there\’s no equity in the house)?

Yes, however CRA would be under no obligation to remove the lien. When a proposal is filed to your creditors, you receive legal protection that prevents creditors from taking any further legal action against you in an effort to recover the debts you have with them.

If the proposal is accepted by the majority of your creditors (every creditor has one vote for every dollar you owe them), then all creditors are bound by the terms of the proposal.

The lien will likley remain and CRA will be paid from the proceeds of the sale of the property when or if you eventually can sell the property for enough money to be able to pay out all the encumberances against the property.

If filing a consumer proposal or personal bankruptcy can often be the first step toward getting a fresh start with all your debts including CRA. Call me today at 519-622-3773 or sending me an e-mail. I look forward to meeting with you in Cambridge and helping you make your plan for a fresh start!