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Can I Keep My Assets in a Consumer Proposal?

can i keep my assets in a consumer proposal

Key Takeaways

Consumer proposals have become a popular option over bankruptcy in Canada because you get to keep all your assets. In a consumer proposal, you keep all your assets and agree to a payment agreement with your creditors for up to 60 months with no interest.


The fear of losing your assets can be paralyzing when facing overwhelming debts. But here's the good news: in Canada, a consumer proposal offers a lifeline that allows you to regain control of your finances while keeping most, if not all, of your assets. This powerful debt relief solution provides a clear path to a fresh start without sacrificing your hard-earned possessions.

This article will explore the ins and outs of a consumer proposal and how it can safeguard your assets. From your home and car to your investments and savings, we'll address your burning questions and provide the information you need to make an informed decision about your financial future.

The Benefits of a Consumer Proposal

A consumer proposal is a legal settlement offer made to your unsecured creditors, such as credit card companies and personal loans. It allows you to repay a portion of your debts over a maximum period of five years, often paying less than the total amount owed. This allows you to regain control of your finances without bankruptcy or informal debt solutions.

One of the best benefits of a consumer proposal is the ability to keep your assets. Unlike bankruptcy, where you may be required to surrender certain possessions, a consumer proposal allows you to retain ownership of your home, car, investments, and personal belongings. Let's explore how various assets are protected in a consumer proposal.

Protecting Your Home

For many people, their home is their most valuable asset. The thought of losing it can be distressing. However, with a consumer proposal, you can keep your home as long as you continue making monthly mortgage payments. As a secured debt, your mortgage is treated differently from unsecured debts, which is not part of the process. If you cannot afford both your mortgage and consumer proposal payments, consider downsizing or selling your home and using the funds to contribute to your proposal.

Keeping Your Vehicle

Many individuals rely on their vehicles for transportation and depend on them for work and daily activities. The good news is that a consumer proposal generally allows you to keep your car, regardless of its value. If you can afford your consumer proposal payments and any financing or lease payments, you can continue driving and maintaining your vehicle's ownership.

If you have an expensive car lease or financing agreement that you no longer wish to continue, you can include the vehicle as part of your consumer proposal by returning it. Any outstanding debt resulting from the cancellation will be included in your proposal, giving more room back in your budget.

Safeguarding Your Investments and Savings

When it comes to your investments and savings, a consumer proposal offers significant protection. Registered savings plans, such as RRSPs, may not be subject to seizure by the Licensed Insolvency Trustee. All contributions made over 12 months from your filing date will be exempt from your creditors if you were to file for bankruptcy. While you don't have to repay this amount in a consumer proposal, creditors will factor this into your consumer proposal offer.

Similarly, Registered Education Saving Plans (RESP) and other investments you have contributed can be preserved in a consumer proposal. Unlike bankruptcy, where these assets may become subject to seizure, a consumer proposal allows you to retain ownership and continue to benefit from your investments.

The Importance of Rebuilding Credit

While a consumer proposal provides debt relief and asset protection, it's crucial to understand the importance of rebuilding your credit. As you progress through your consumer proposal and make your fixed monthly payments, you'll have the opportunity to demonstrate financial responsibility and improve your creditworthiness.

Building a positive credit history becomes easier once your consumer proposal is in place and you have a clear repayment plan. Make sure to consistently make your payments on time and consider gradually implementing strategies to rebuild your credit score. Over time, you'll be able to regain financial freedom and access to better borrowing options.

Additional Considerations and Expert Advice

While a consumer proposal offers numerous benefits and asset protection, it's essential to consider your unique financial situation and seek expert advice. Consulting with a Licensed Insolvency Trustee can provide valuable insights and guidance tailored to your needs.

A Licensed Insolvency Trustee will review your assets, liabilities, income, and expenses to help you determine the best debt relief options for your personal circumstances. They can offer advice on navigating your mortgage, car loans, investments, and other assets during the consumer proposal process. With their expertise, you can make informed decisions and ensure the best possible outcome for your financial future.


In conclusion, a consumer proposal is a powerful tool that allows you to regain control of your finances while keeping your assets intact. Whether it's your home, car, investments, or personal belongings, a consumer proposal offers protection and a clear path to debt relief.

By understanding the benefits of a consumer proposal and seeking expert advice, you can make informed decisions that will set you on the path to financial freedom. Remember, the journey to debt freedom may take time, but with the right plan, you can preserve your assets and achieve a fresh start.

Take control of your financial future and explore the possibilities of a consumer proposal. Consult with Litvack Group to determine the best course of action and embark on a journey towards a debt-free life.



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