How to Protect Your Assets with a Consumer Proposal


Learn How to Protect Your Assets in Canada

Consumers are often worried about the impact that filing a Consumer Proposal or declaring Bankruptcy can have on their assets. For many, their most valued asset is their home and a fear of losing it can lead them to a delay in facing the reality of their financial difficulties. But here is the question, if you become insolvent, can you lose all of your assets and possessions?

In a bankruptcy, the Trustee will assess the value of your assets, including any equity in your home. Equity in your home is calculated by deducting the balance on the mortgage(s) from your property’s market value. With some exceptions, the majority of the debtor’s assets will be assigned to the Trustee. The debtor will have the opportunity to repurchase their interest in their assets from the Trustee and be able to retain them. Prior to filing the Bankruptcy, the Trustee will advise the Debtor as to how much it will cost to retain his/her assets that are not exempt.

In Ontario the following assets are exempt from sale and seizure:

Asset Exemption
Primary residence $10,000, remaining net equity portion is settled with Trustee
Household furniture and personal belongings $13,150
Vehicle $6,600
RRSP If no contributions were made in the last 12 months prior to filing
Tools of Trade

(i.e. Construction, Landscaping)



The main purpose of a Consumer Proposal is to allow you to protect your assets while offering the creditors a return which is better than what they would receive in a bankruptcy. While the equity in your home is still considered in the evaluation of your assets, your interest does not need to be assigned to Trustee. The Proposal Administrator will calculate any equity you might have (including equity in your house, vehicle, or investments), and make an offer to the creditors based on the value of these assets. Keep in mind that in order for your Consumer Proposal to be accepted by the creditors it has to be more profitable to them than if you were to declare bankruptcy.

As you can see, a Consumer Proposal will help you eliminate your debts while allowing you to keep the assets that you value. A Consumer Proposal is a great alternative to a bankruptcy as  your assets are fully protected. As long as you keep making payments towards your mortgage, vehicle, or other secured assets you can keep them.

If you are concerned about losing your house (or any other assets) consulting with a Trustee can help you prevent this from happening.  At Sheriff Sole & Madej Inc. we would be happy to discuss your specific financial situation and assist you to determine how filing a Consumer Proposal or a bankruptcy will affect your assets. Call us today at 1-844-482-3328 to book a free confidential consultation. We offer services in Toronto, Mid-town Toronto, North York, Markham, Vaughan, Pickering, Mississauga, and Brampton in seven different languages.



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