When people hear about or think about bankruptcy, the first thing that comes to mind is that they will lose everything if they go bankrupt. In most cases, many of a person’s personal assets are exempt from seizure in a bankruptcy. What you can or cannot keep depends on the province in which you reside.
Although the Bankruptcy and Insolvency Act is Federal Legislation, and is exactly the same across Canada, Section 67 of the Bankruptcy and Insolvency Act allows each province or territory to set or regulate which assets their residents can keep in a bankruptcy. The provincial legislation varies in name and in most cases, the provincial laws are referred to as Civil Enforcement or Exemption Acts.
In Alberta, the legislation is referred to as the Civil Enforcement Act of Alberta.
*Equity = The Asset’s value minus any liens, mortgages, or encumbrances against it
PLEASE NOTE:
An individual’s exemptions are subject to the provisions of any security agreement, lien or interest registered against an asset by a secured creditor, and if valid, the creditor’s rights and remedies provided for in that agreement. If an individual fails to make the agreed upon payments, or fails to satisfy any other terms of a valid security agreement, the creditor may repossess the asset. If an agreement is not registered, the original secured creditor’s interest passes to the bankruptcy estate for realization on behalf of the general body of unsecured creditors.