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Ontario Bankruptcy and Consumer Proposal Statistics

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.

We update this page for monthly data trends as they are released by the Office of the Superintendent of Ontario.

Joe Debtor Annual Bankruptcy Study

Monthly Trends 2020 Consumer Insolvency Filings

These statistics are updated monthly based on data released by The Office of the Superintendent of Bankruptcy.  The OSB data is released at the end of the month and is generally two months in arrears.

Consumer insolvency declines accelerated modestly in July but remain off peak declines experienced at the beginning of the COVID-19 shutdown. Year over year, Ontario consumer insolvencies declined 36.3% in July 2020 compared to 34.3% in June. Canadian consumer insolvencies decreased by 42.7% in July, compared to a drop of 41.8% in June.

Insolvencies are typically slower in the summer; however, COVID-19 continues to dampen volumes below expected norms. We see signs of increased inquiries as the economy re-opens. Courts are now open, which will lead to a return threat of wage garnishments and potential eviction notices, two pressures that prompt people to take action to deal with their debt. Clients have also reported an uptick in collection calls. Current loan deferrals and CERB payments continue to help many Canadian delay the need to file to a future time. Both these buffers will be ending soon. Realistically the downward trend will continue into the fall, but we expect a strong resurgence in 2021.

Ontario bankruptcies declined by 48.8% and consumer proposals fell 30.4%. Across Canada, proposals were down 38.0% and bankruptcies declined49.8%.

Consumer proposals accounted for 74.1% of consumer insolvencies in Ontario, marginally lower than the peak rate in May but still considerable, given the number of people using payment deferrals and on CERB. High income that results in additional surplus income payments in a bankruptcy, and home equity, are the two primary reasons why heavily indebted consumers are increasingly choosing a proposal over bankruptcy.

Our Homeowners Bankruptcy Index bounced up from July lows to 4.4% in August 2020. Again, mortgage deferrals and a still strong housing market are providing a buffer for the time being.

Consumer Insolvency Statistics Ontario 2019

Total insolvencies filed by Ontario consumers rose 15.4% in 2019 according to data released by the Office of the Superintendent of Bankruptcy.

In total, 44,852 hardworking individuals filed insolvency in Ontario in 2019.

Personal bankruptcies fell 0.6%  while consumer proposals increased by 25.1%.

In 2019, 67% 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 2019, homeowners were not a significant driver of consumer proposals. 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 2019 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.

Below is a summary of 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 learn more about how much debt it takes to file bankruptcy on our interactive graphic: Regional Consumer Debt & Bankruptcy which shows total insolvencies, average consumer debt levels, and debt-to-income by region.

REGION*

Consumer Insolvencies Total Growth Growth Bankruptcy Growth Proposal % Proposals
Canada 137,178 9.5% -1% 17.9% 60%
Ontario 44,852 15.4% -0.6% 25.1% 67%
           

REGION*

         
Barrie Region 2,013 18% 1% 28% 68%
Belleville Region 883 15% 9% 17% 68%
Brampton 2,168 22% 2% 31% 76%
Brantford Region 756 15% 3% 21% 69%
Brockville Region 510 -7% -11% -3% 50%
Cambridge 562 21% 14% 25% 68%
Chatham Region 452 9% -4% 19% 60%
City of Toronto 2,604 17% -3% 28% 71%
Cornwall Region 563 17% 19% 15% 53%
Essex-Leamington Region 282 21% -11% 54% 62%
Etobicoke 1,256 17% 5% 23% 68%
Guelph 440 13% -11% 37% 60%
Hamilton Region 1,923 18% -4% 32% 68%
Huron Region 427 6% 4% 9% 49%
Kingston Region 643 17% -6% 38% 62%
KW-Wellington Region 1,314 5% 1% 8% 65%
London Region 2,286 8% -7% 18% 66%
Markham 709 20% 15% 21% 77%
Mississauga 2,090 15% 3% 20% 72%
Newmarket & Area 861 27% 13% 35% 68%
Niagara Region 1,465 11% 4% 17% 62%
North Bay Region 596 11% -6% 21% 66%
North York 3,011 20% 4% 27% 75%
Burlington-Oakville Region 1,240 26% 13% 32% 71%
Orangeville & Area 353 15% -3% 25% 72%
Oshawa-Bowmanville Region 1,702 38% 18% 48% 71%
Ottawa Region 3,398 8% -10% 24% 63%
Parry Sound-Huntsville Region 420 6% 0% 8% 69%
Pembroke Region 348 4% -19% 28% 58%
Peterborough Region 770 8% -15% 22% 70%
Pickering 713 32% 21% 36% 75%
Richmond Hill 507 30% -7% 51% 73%
Sarnia Region 382 5% -12% 23% 57%
Sault Ste. Marie Region 459 11% 1% 30% 39%
Scarborough 2,299 21% 6% 27% 74%
Stratford Region 158 -1% -21% 14% 66%
Sudbury Region 1,231 11% -4% 22% 63%
Thunder Bay Region 572 5% -1% 15% 44%
Timmins Region 610 19% -4% 33% 68%
Vaughan 421 18% 23% 7% 71%
Windsor Region 1,072 9% -10% 26% 63%
Woodstock Region 360 19% 12% 23% 64%
*Region includes surrounding rural areas

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 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