What You Keep In a Bankruptcy

Declaring bankruptcy can seem daunting, but it’s important to know that it may not mean losing everything you own. What You Keep In a Bankruptcy varies from one jurisdiction to another, and there are specific assets you’re allowed to retain.

Understanding Bankruptcy

Before we delve into the specifics of What You Keep In a Bankruptcy, it’s essential to understand what bankruptcy is. Bankruptcy is a legal procedure where an individual or a business unable to meet their financial obligations can find relief from some, if not all, of their debts.

Exempt Assets: What You Can Retain

There are particular assets that you can retain even after filing for bankruptcy. These are referred to as ‘exempt assets’ under both federal and provincial laws.

Equity in Your Home

In many cases, the equity in your home is considered an exempt asset. This means that you can keep your house even after declaring bankruptcy, provided you continue to make your mortgage payments.

Your Vehicle

Your car may also be considered an exempt asset, especially if it is vital for your work or family life. Again, the continuation of loan payments is a prerequisite.

RRSPs and Other Retirement Accounts

Most retirement savings accounts, including RRSPs, are typically exempt from bankruptcy proceedings.

Household Possessions and Personal Items

Everyday household items and personal belongings are usually exempt from bankruptcy proceedings. This includes furniture, clothing, and other basic necessities.

Medical Aids

If you or a family member require medical aids for health reasons, these will typically be considered exempt assets.

Equipment Needed for Work

Tools or equipment that you use for your work are generally considered exempt assets.

Non-Exempt Assets: What You Might Lose

While there are many exempt assets, there are also non-exempt assets in a bankruptcy proceeding. These are assets that you may have to surrender or buy back from the estate.

Luxury Items

Luxury items, such as boats or expensive jewelry, are usually considered non-exempt assets.

Second Properties

If you own additional properties beyond your primary residence, these are typically considered non-exempt assets.

Provincial Differences

The specifics of what you can keep during a bankruptcy vary from province to province. It’s important to consult with a Licensed Insolvency Trustee to understand the specifics based on the province you live in.

The Role of a Licensed Insolvency Trustee

A Licensed Insolvency Trustee is a professional who can guide you through the bankruptcy process. They can explain the specific assets you can keep based on your location and personal circumstances.

Secured Loans and Bankruptcy

It’s possible to keep assets financed by a secured loan, such as your home and car, as long as you continue to make the necessary payments.

Life-Changing Debt Solutions

Bankruptcy is not about what you have to give up, but about ensuring your financial future. It’s a solution that can give you a fresh start and allow you to rebuild your financial life.


While bankruptcy may seem like a dire situation, it’s important to know that you do have rights and options. Understanding What You Keep In a Bankruptcy is the first step towards regaining control over your financial future.

For more information on what you get to keep after declaring bankruptcy across Canada, please click here.

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