Can You Keep Any Assets When You File Personal Bankruptcy?

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One of the biggest concerns people have when they turn to us interested in filing personal bankruptcy is whether they will be able to keep any of their assets. While you may need to sell certain assets to repay your creditors during bankruptcy, you may be able to keep limited amounts of:

•   Furniture and clothing

•   Food and heating fuel

•   Health aids

•   Farm land, animals, and equipment

•   Pensions or retirement savings

filing personal bankruptcy

You may also be able to keep your vehicles and your home, depending on your personal bankruptcy situation. Every province and territory puts limits on the value of these exemptions. While some declaring bankruptcy can keep their home, others may have to sell their home and use the excess value to repay their creditors, depending on how severe the limit is.

Note that during personal bankruptcy, your bank account is not considered an exempt asset. During the process, you should carefully manage your personal banking to ensure no inappropriate payments accidently go to your creditors.

You should also keep in mind that you may be able to keep your assets and avoid exemptions if you decide to file a consumer proposal, which is a settlement negotiated between you and your creditors. However, there are restrictions on who can submit a consumer proposal and who is eligible, depending on the amount and type of debt owed.

If you have questions about keeping assets during bankruptcy or filing a consumer proposal, contact us at Morgan & Partners Inc. We are here to help you get back on track towards financial freedom, confidence, and stability!