September 16th, 2008 by Questions
what is the difference between a Division I proposal and a consumer proposal?
Posted from: Ontario
September 17, 2008 at 9:26 am, Barton Goth - Goth & Company Inc. - Bankruptcy Trustees said:
A Division I Proposal was originally intended for commercial situaitons so is a little more involved than a consumer proposal. However some of the major differences are as follows:
1. There is an automatic bankruptcy that occurs if a Division I Proposal is not accepted or is defaulted on, and this does not happen with a consumer proposal;
2. The time frame for the creditors to vote is shorter in a Division I vs a consumer proposal (21 days vs. 45 days);
3. A Division I Proposal requires a greater level of support than a consumer proposal; and
4. There are also some administrative differences that really only pertain to the trustee (i.e. a court application must be made to approve the proposal after it has been accepted by the creditors), but these are largely procedural in nature.
Either way you are best to contact a local trustee and they will be able to help determine which type of proposal would fit your circumstances best.
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