- Help Center
- Debt Repayment Options
- Division I Proposal (debts over $250,000, excluding principal residence mortgage)
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Consumer Proposals
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Personal Bankruptcy
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Debt Repayment Options
- Do Nothing
- Debt Consolidation Loan
- Informal Agreement with Creditors
- Debt Management Program (DMP) - Offered through Credit Counselling Society
- Orderly Payment of Debts (OPD) - Offered through Money Mentors
- Consumer Proposal (debts less than $250,000, excluding principal residence mortgage)
- Division I Proposal (debts over $250,000, excluding principal residence mortgage)
- Bankruptcy
What are the disadvantages of a Division 1 Proposal?
The main disadvantage of a Division I Proposal is that you are deemed bankrupt if creditors reject the proposal or if you fail to comply with the proposed terms.
The other disadvantages of a Division 1 Proposal include:
- It's more expensive than bankruptcy.
- It's often a longer process as compared to bankruptcy.
- Creditors will drive the proposal terms (Creditors can vote against and request more money to be paid as a condition of their acceptance of the proposal)
- There is no guarantee creditors will accept your initial proposal offer.