A Division I Proposal is filed when an individual's debts exceed $250,000, excluding mortgage debt. They are a more complex filing and Sheriff Sole & Madej Inc. has extensive experience with successful Division I filings.
These filings tend to be more common with small business owners who may have used personal credit to fund their business operations. Division I filings should not be feared and our staff will be happy to walk you through the process.
What are the main differences between a consumer proposal and a Division I filing?
The biggest difference between a consumer proposal and a Division I filing is the assignment into bankruptcy, if the proposal is rejected. Additional paperwork is necessary in a Division I filing.
Are there any penalties if I end up being assigned into bankruptcy? There are no additional penalties if you are assigned into bankruptcy.
Will the creditors make a counter proposal if the initial proposal isn’t high enough? It’s likely the creditors will come back and ask for a higher dollar amount if all the other areas of the Division I proposal are acceptable. If that happens, we negotiate with the creditors to find an acceptable dollar value.
Are the payments higher in a Division I filing?
Since the debts are higher in a Division I filing, the payments do tend to be higher as well.
How does a Division I Proposal affect my credit? A Division I Proposal stays on your credit report for three years from the date of the last payment. If you took the full five years to pay off your proposal, it would stay on your credit report for three more years. In Ontario, you are allowed to apply for secured credit after a minimum of six months of payments towards your proposal.