Ontarians continue to carry record levels of personal debt and for many residents, a consumer proposal or a personal bankruptcy becomes the only way out of financial trouble.
Below you will find commentary on the most recent annual consumer proposal and bankruptcy statistics for 2017. We also update this page for monthly data trends as they are released by the Office of the Superintendent of Ontario.
Consumer Insolvency Statistics Ontario 2017
Total insolvencies filed by Ontario consumers declined 3.6% in 2017 according to data released by the Office of the Superintendent of Bankruptcy.
In total, 38,167 hard working individuals filed insolvency in Ontario in 2017.
Personal bankruptcies fell 9.3% while consumer proposals increased 0.5%.
In 2017, 60% of consumer insolvencies filed in Ontario were consumer proposals. Heavily indebted consumers with high income and high asset values turn to a consumer proposal as a way to avoid high surplus income payments in a bankruptcy and keep their home. In 2017, homeowners were not a significant driver of consumer proposals as seen by the decline in our Homeowner’s Bankruptcy Index. Instead, indebted homeowners have relied on their home equity to refinance their credit card and other debt through a second mortgage, HELOC or debt consolidation loan.
The increase in proposals in 2017 is more a reflection of strong employment conditions in Ontario. Insolvent debtors with a household income above the government mandated thresholds limits are more likely to choose a consumer proposal as an alternative to bankruptcy in order to spread potential surplus income payments over a period of up to five years. In fact, based on an update of our bankruptcy study, the average consumer proposal filer earned an income that was 34% higher than the average person filing bankruptcy in 2017.
Below is a summary on insolvencies by geographic region as summarized by Hoyes Michalos based on insolvency statistics by FSA provided by the Office of the Superintendent of Bankruptcy (OSB). Regional FSA allocations may differ slightly from annual economic region data provided by the OSB as the regional data summarized by Hoyes Michalos provides additional location details than is available by economic region.
You can also see this information in an interactive consumer debt map which shows total insolvencies for 2017, average consumer debt levels, and unsecured debt-to-income by region.
|Consumer Insolvencies||Total Growth||Growth Bankruptcy||Growth Proposal||% Proposals|
|City of Toronto||2,244||2%||3%||1%||60%|
|Newmarket & Area||630||-2%||1%||-5%||59%|
|North Bay Region||502||-3%||3%||-8%||54%|
|Orangeville & Area||279||-3%||-13%||4%||63%|
|Parry Sound-Huntsville Region||407||-2%||-28%||30%||60%|
|Sault Ste. Marie Region||425||14%||10%||25%||29%|
|Thunder Bay Region||503||-8%||-13%||-2%||44%|
|*Region includes surrounding rural areas|
Monthly Trends Consumer Insolvency Filings in Ontario
These statistics are updated monthly based on data released by The Office of the Superintendent of Bankruptcy. The OSB generally releases data is released at the end of the month and is generally two months in arrears.
Consumer insolvencies in Ontario declined 4.4% in December.
Hover over the bars to see the most recent consumer insolvency numbers for Ontario.
Consumer proposals declined 6.3% year over year in December, and bankruptcies declined 1.7%.
Consumer proposals are debt relief of choice for insolvent debtors. Proposals accounted for 60% of all insolvency filings in Ontario in 2017.
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.
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 2017. 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.
For commentary and information about consumer insolvencies and debt issues in Ontario, contact:
J. Douglas Hoyes
CA, CPA, Licensed Insolvency Trustee
CA, CPA, Licensed Insolvency Trustee