Ontarians continue to carry record levels of personal debt and for many residents a consumer proposal or a personal bankruptcy become the only way out of financial trouble.

Below you will find commentary on the most recent annual consumer proposal and bankruptcy statistics for 2016 along with monthly trends for 2017.

Monthly Bankruptcy and Consumer Proposal Statistics 2017

Consumer insolvencies in Ontario declined 3.2% in November, and are now tracking towards an annual decline for 2017 of around 4%.

Hover over the bars to see the most recent consumer insolvency numbers for Ontario.

Consumer proposals increased year over year for the fifth consecutive month, up a strong 5.8% in October, while bankruptcies were down 15.4%.

This continues the overall trend we have seen in 2017 – a decline in bankruptcies, offset by a modest increase in consumer proposals. The shift towards proposals is largely due to stable employment income and higher house prices.  Heavily indebted consumers with high income and high asset values turn to a consumer proposal as a way to avoid high bankruptcy payments and keep their home.

Consumer proposals are debt relief of choice for insolvent debtors. Proposals accounted for 62.6% of all insolvency filings in Ontario in November.

A prolonged period of low interest rates and rising home equity have combined to help most Ontarians keep ahead of their debt payments. This has led to a prolonged decline in consumer insolvencies in the province overall.

Higher overall debt levels, however, remain a concern, and a change for the worse in any of these economic conditions will lead to increased loan default and, ultimately, higher insolvency rates.

Consumer Insolvency Statistics Ontario 2016

Total insolvencies filed by consumers declined 0.8% in 2016 according to data released by the Office of the Superintendent of Bankruptcy.  Personal bankruptcies fell 5.9%  while consumer proposals increased 3.3%.

In total, 39,611 hard working individuals filed insolvency in Ontario in 2016.

To see insolvency statistics. consumer debt and debt-to-income ratio by city & region across Ontario, see our Interactive Consumer Debt and Bankruptcy Statistics Map

Low interest rates and strong employment have helped restrain consumer insolvencies in Ontario over the past year. As housing prices have increased, the attractiveness of debt consolidation over insolvency as a debt restructuring mechanism has helped temper the growth in Ontario consumer insolvencies despite record debt levels. However, even a small negative change in economic conditions could trigger a shift towards a stronger growth trend for consumer insolvencies in Ontario as we saw happen in several western provinces in Canada in 2016.

In general, proposals account for a much higher share of insolvencies in 2016 than 2015. This has been driven partially by the rapid rise in house prices and homeowner’s equity for insolvent homeowners not eligible for a debt consolidation loan, as well as Ontario’s relatively steady employment picture.

Who files insolvency in Ontario?

The average insolvent debtor looks much like the average person in Ontario. They are working and struggling to make ends meet. To read more about the what the average bankrupt looks like, see our bankruptcy research study: Joe Debtor.

Press Inquiries

For commentary and information about consumer insolvencies and debt issues in Ontario, contact:

J. Douglas Hoyes
CA, CPA, Licensed Insolvency Trustee
Email Doug

Ted Michalos
CA, CPA, Licensed Insolvency Trustee
Email Ted