Consumer vs. Division I Proposal

Hello,

I don`t know if you can help or not. I have been looking into filing a consumer proposal but I don`t know if I can or not. I have been fighting with these debts for years now and they just don`t seem to be going away.

I owe roughly $89,000, not including my mortgage. The big problem is that I do not wanting to file a Div 1 because if it isn`t accepted it ends up in me being bankrupt. Is this correct?

I have been told that sometimes a secured car loan for example is listed as only $1. If we did this my debt would be just under the $75000 mark. Is this something that can be done?
I really need your help.

Posted on Thursday, September 4, 2008 | Filed under: Bankruptcy
 posted by Questions @ 7:27 am 1 Comment
1 Expert Comment:

 At September 8, 2008 | 11:36 am , Barton Goth GCO Bankruptcy Trustees Said...

The Superintendent will accept a lease listed at $1, but not a financed vehicle. So right now you wouldn’t qualify for a Consumer Proposal, you would have to use a Division I Proposal instead.

While I understand your reservations and concerns over this automatic bankruptcy provision, practically speaking we find that if someone defaults in a consumer proposal, while a bankruptcy is not automatic, in most instances they end up filing a bankruptcy anyways. So realistically I wouldn’t focus on the potential bankruptcy as it is a real possibility in either circumstance.

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