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Keeping mortgaged home during a proposal

Hi, When a person files for a consumer proposal and wants/needs to keep his home, is there a negotiation process that goes on with his mortgage lender. Most of the debts that would have to be covered would be with the CIBC, which is also the lender of the mortgage. Thanks

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One Response to “Keeping mortgaged home during a proposal”

Barton Goth, GCO Inc. Bankruptcy Trustees said...

The answer to this is partially dependent on the amount of equity in you home and the province in which you live.

If the amount of equity in your home is less than or equal to your provincial exemptions, then this really doesn’t become an issue as long as you are up to date with the payments. This because a consumer proposal is essentially directed toward your unsecured creditors, and in the proposal you can include a term that will state the mortgage on the home will be paid in full as originally contracted.

If the amount of equity in your home exceeds your provincial exemption, in most instances you can still stay in the home you simply will need to offer up more to the creditors in a proposal.

This shouldn’t be a significant issue with the filing of a consumer proposal but I recommend reviewing your concerns with a licensed trustee so he can base his comments on the specifics of your situation.