Keep Your Assets With A Consumer Proposal 

How to Keep Your Assets By Making a Consumer Proposal

For those who would like to keep their assets and avoid filing for bankruptcy when in debt, a consumer proposal can be the right choice to make.

A consumer proposal could allow you to keep assets that you would not be able to keep had you filed for bankruptcy, which is why it’s an attractive option for many who want to get their finances back on track.

A consumer proposal will protect you while you receive debt relief, which is crucial if you have equity in your house, expect a tax refund, or want to keep your savings.

You may be able to keep your home, cars, and any other assets when you file a consumer proposal.

It might sound too good to be true, which is why knowing how all of this works before deciding to go ahead is key.

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How A Consumer Proposal Affects Your House And Mortgage

A consumer proposal can allow you to keep your home providing you make your monthly payments as normal.

A mortgage lender could only foreclose your home if you are behind on your payments and they will not be able to change the terms of your mortgage.

If you have a good history with your mortgage lender (up to date payments) then you should be able to renew your mortgage during a consumer proposal.

Switching lenders is much more difficult as it is classed as a new application.

By filing a proposal you may not get an approval from a new lender and have to deal with a higher interest rate if you attempt to refinance.

A Licensed Insolvency Trustee will review your assets, liabilities, Income, and Expenses to help you figure out what to do.

You might decide that it’s best to downsize your home if you come to the conclusion that this is where many of your money troubles come from.

Surrendering your home or moving before you file will mean you won’t have an issue finding a place to rent, so you will need to get all of your ducks in a row before going ahead with the consumer proposal.

What About Your Vehicle Car Loan or Lease?

Bankruptcy allows you to keep one vehicle up to a set amount.

If the value of your vehicle exceeds the amount you are allowed, you would then need to purchase back additional equity from the trustee in a bankruptcy so that you can keep your car.

If you own two vehicles then you would need to surrender your second vehicle, as it is an asset.

A consumer proposal allows you to keep all of your owned vehicles and the value does not matter.

You can also keep leased or financed vehicles.

A consumer proposal does not include secured debt such as a car loan, so you can keep any leased or financed car if your payments are up to date and you can continue to make those payments.

If you miss payments then your secured lender will repossess the vehicle.

If your lease is expensive and you do not wish to continue making payments on it, then you can cancel this as part of your proposal.

The amount you owe from cancelling will be included as an unsecured debt  and you must then surrender the vehicle before you file your consumer proposal for any shortfall to be included as a dischargeable debt.


Bankruptcy law states that an RRSP cannot be seized by a licensed insolvency trustee, apart from any contributions made in the last year.

However, a consumer proposal allows you to keep these.

You would have to hand assets such as RESPs over in a bankruptcy, but a consumer proposal means you can keep these assets, too.

Why Can You Keep Your Assets?

A consumer proposal is a debt settlement that you and your creditors make with the assistance of a licensed insolvency trustee.

The proposal you offer will be greater than the value of the assets you have, as an administrator will calculate your equity and reach a suitable sum.

A creditor will accept the proposal if they feel they will receive more than they would get in a bankruptcy – in a proposal you pay the value of those assets to your creditors over a set period, rather than surrendering your assets to the trustee.

A consumer proposal is beneficial because you are able to keep assets such as your home and pay a small amount each month to work towards becoming debt free.

This agreement allows you to effectively eliminate your debt, keep your assets, and work towards a brighter financial future in one fell swoop.

Is A Consumer Proposal Right For You?

You may not understand whether a consumer proposal is the right choice, bankruptcy, or another solution.

Bankruptcy Canada can assess your situation and help you to come up with the ideal solution.

A consumer proposal might be for you if:


  • Your unsecured debt doesn’t exceed $250,000;
  • Your debts are greater than the value of what you own;
  • You can pay a portion of your debts;
  • You can make a monthly payment or one lump sum.


If the above points resonate with you, then a consumer proposal might be the best option.

Understanding all of this can be confusing, but Bankruptcy Canada is available to give you non judgemental advice.

Get In Touch With Bankruptcy Canada Today

You can contact us today for a free, confidential consultation to help you get back on the road to financial security.

Our expert and accredited team can provide advice, credit counseling, bankruptcy advice, financial assessments, and more.

We have helped thousands of people over a 20 year period to get back on their feet.

Get in touch with us today to learn more about filing a consumer proposal and whether it’s right for you.

Information on Consumer Proposals

Consumer Proposals in Canada – An Alternative to Bankruptcy
What is a Consumer Proposal?
What are the Benefits of a Consumer Proposal?
What are the Steps in a Proposal?
What Debts Are Erased in a Consumer Proposal?
Is There Life After a Proposal?
Consumer Proposal Eligibility
How to Amend a Consumer Proposal

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