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I'll try to keep this brief because my story isn't much different from most of the others that I have read here. In November of 2007 I completed a consumer credit proposal which included the federal portion, provincial portion and risk portion of my student loans. My end of study date was April of 1998. Which means that I completed my proposal prior to the ten year rule and the remainder of the debt was not discharged. CBV Collections started calling me for the provincial portion when I began my new job just a little over three months ago. It's pretty obvious that my SIN was a big flag. Of course they want over $10,000 and they want it all now. We did the whole song and dance about getting a bank loan to consolidate my debt and allow them to get their commission faster. I actually took the time to speak with an uncle of mine and pitch the idea to him. We are very close, but he's not a wealthy man and he feared that I would just be providing them with another person to bleed. Anyway, I'm fortunate to be working in a reasonably well paid job. And I have offered them about ten per cent of the total amount plus 36 monthly payments. Previously they said that they would only accept the entire amount owing. And the minimum allowable payment would be $618 per month, which they didn't even want to discuss. To my surprise a representative called me (the auto dialer calls every day) and she accepted my payment proposal. The problem is they couldn't put it in writing. I insisted that it must be in writing. On the phone they were very careful to agree to my payments but came short of saying that at the end of the 36 months the balance would be clear. Then yesterday I got another call. Yeah, sure! Let's get this done. Can I fax you the agreement? How soon can you send those checks? Then today I get another call. We have no such letter. We aren't allowed to put it in writing. The ministry guidelines do not allow us to put it in writing or send a letter agreeing to payment schedules The whole amount is due now. Have you ever filed a financial questioniarre?

So this is the situation; I do not have assets anywhere equal to the amount owing. Through direct payments to the Bank of Nova Scotia (after leaving one college and before beginning another) through collection agencies and a consumer credit proposal I have paid off Three times the amount I borrowed for my education. Granted not all of the money I paid into the consumer credit proposal actually went to my creditors. The trustee does take fees from the monies. And still they won't accept a reasonable payment plan (with ten per cent paid upfront) to clear off the balance!

Fortunately I have spoken to a lawyer and I have representation. But why are they being such idiots about this? I'm offering to pay! Just put it in writing.

Thank you Johnny, but I have a lawyer and they are handling this. I just really enjoy this forum and wanted to share my experience with others.

Hey Johnny,

I understand what you are saying. My offer is sincere, but my lawyer also feels that if they are declining a reasonable settlement it may help my case to file a motion under section 178 to have the debt discharged as part of the consumer credit proposal which I completed. Worse case scenario we have a settlement hearing and we work out a payment schedule that isn't really too much different than what I have offered. I'm trying to avoid bankruptcy because I do have a job and I would like to repair my financial situation. It's still not a fantastic paying job. I work for a not for profit organization and it is terribly unlikely that I'm going to get a huge promotion with a big raise. Those kind of positions just aren't available at my company. I can't reasonably expect to improve my earning potential without upgrading my skills and education. And again with this debt I don't have the means to do that. In some ways it is cheaper for me to declare bankruptcy and pay the difference between my income and the allowable personal expenses under the bankruptcy act for 9-12 months. But I am an honest debtor and want to resolve this as best as possible without resorting to bankruptcy.

Hopefully this is resolved soon and I can look back at this as the decade that the government and collections agencies made my life miserable.

I appreciate what you are saying. My lawyer has asked me for a detailed employment history and we have already discussed the financial hardships which I faced prior to entering college and the years since I left. There are many factors in my favour. Student loans were my only option. My father left when I was very young and my mother was deemed an unfit parent. I was in foster homes when I was young and eventually was placed in the custody of my maternal grandmother who was on a fixed income. I left my programs due to financial hardship and spent many years in low paying jobs outside of my field of study. I paid a portion of my student loans between leaving my first college and starting my second. I paid large amounts through collection agencies for several months before entering a consumer credit proposal. I have never taken on any other kind of debt. Not a car loan, mortgage, lease, credit card, line of credit or even deferred payment on furniture or electronics. I am completely willing to make significant monthly payments and have acted in a forthright manner. My lawyer has explained that my current income is a major factor against me. I'm single with no dependents and make a fair wage. Which is why I would be very happy to settle. I'm not looking for a get out of jail free card. I'm looking for an end date. Something that says "Hey you still have to pay more, but this is almost over". I'm very aware that many people who declare bankruptcy do it not once but twice or three times. And that isn't a pattern that I want to set for myself. My goal is to retire this debt and move to Europe. It's difficult for me to move forward without some sort of end date. Of course I would never flee to avoid my responsibilities.

You might be correct. However, doesn't it go in my favour that I am making reasonable efforts to pay the money and yet they still insist of full payment when it is not possible, or will only accept monthly payments far beyhond my means for an indefinite period without applying the payments to the principle?

CVB Collection Services says the minimum payment which they will accept is $618 per month. And this will not make a dent in the principle. Assuming that under the consumer credit proposal that I completed the risk portion and federal portion of the claims are still two thirds of the original claim, I still owe an additional $10,000-12,000 on top of what CBV is collecting for the Ontario portion. So if I make monthly payments of $1,236 I will spend over half of my take home pay to credit agencies and be no further ahead in repaying the total debt. My personal assets are well below $22,000. I'm about $20,000 short! Despite having a monthly take home pay of approximately $2,200 I fall into the legal definition of bankrupt. My monthly expenses and  debt exceeds my income. My total debt exceeds my assets. This debt will cause me continued financial hardship. As well I will not have the means to improve my skills and education, make personal savings, invest monies for future expenses including dependents.

When I say that I am willing to make considerable payments to retire this debt I'm not saying that it would be done easily. Or that I can continue to maintain this debt without leaving myself vulnerable to market changes and employment instability.

Another small clarification please

If I have already gone bankrupt and been discharged except the student loans can I now apply to do so without filing for a new bankruptcy?  Assuming the 10 or or 7 year rule applies.  Or did filing for bankruptcy kaput everything?  Thanks

I received an e-mail from your office  but I haven't received a response to my reply. I would like to begin negotiating a payment schedule for my student loans.

Yes, I think 200 was your last period of study its now 2008...thats about 8 yrs right...and the law says out of school for 7 yrs right!!!

An order of discharge does not release the bankrupt from

 

(g) any debt or obligation in respect of a loan made under the Canada Student Loans Act, the Canada Student Financial Assistance Act or any enactment of a province that provides for loans or guarantees of loans to students where the date of bankruptcy of the bankrupt occurred

 

Unfortunately from what I understand, student loans taken out under CSL and CSFA are NOT elligible for this seven year discharge law.

 

DB you and I both have to wait the ten years...