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change CSL min payment to 1% of principal

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frustrated-guy View Drop Down
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    Posted: 22/February/2007 at 8:11am
I understand that the Canada Revenue Agency forces defaulted borrowers to repay defaulted Canada Student Loans with a minimum payment of 3% of principal per month. 
 
This large amount of payment causes extreme hardship as forces the borrower to repay the loan in 3 years.
 
Normally non defaulted student loans are paid back over a ten year payment schedule with much lower monthly payments.   A ten year repayment schedule is equivalent to repaying 1% of principal per month.
 
A 3% min minimum payment on a 10,000 loan is $300 per month, while a 1% min payment is $100 per month. 
A 3% min monthly payment on a 20,000 loan is $600 per month, while a 1% min payment is $200 per month. 
 
Presently CRA is forcing borrowers who are having difficulty paying back their loans due to low income to pay much more per month than a borrower who is not having difficulty as borrowers paying back their loan using a regular repyament schedule are allowed 10 years while CRA only allows 3 years at 3% per month.  How is this fair?
 
I think CRA should accept a miniumum payment of 1% percent of principal per month for defaulted student loans.  This payment would be much more reasonable and allows the loan to be paid back over 10 years.
 
 
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