This website is a testimony to the problems Canadian Student Loan borrowers experienced from approximately 1996 to 2008 and until their loans were paid off.

The privatization of the Student Loans system by the Chretien and Martin Liberal governments broke the system and defaulted thousands of borrowers who were trying to pay their loans. There were even stories of suicide due to the harassment of borrowers.

Read the report that I prepared back in 2007 here. Canada Student Loans-The Need for Change Fortunately the new Conservative government at the time revamped the program and fixed the system for new borrowers, but borrowers under the previous program were left with ruined credit and continued harassment from debt collectors.

I call on the Canadian Government to apologize to the borrowers affected by this fiasco and make amends.

Unfortunately the Liberal government is again clobbering the Education system with their upcoming changes to International Student Visas. Yes, there's a problem, but instead of a well thought out plan, they have pulled the emergency brake on the train causing a derailment. This has introduced unprecedented instability for both private and public education institutions who serve both international and local students.

Universities can't plan. I've heard of courses being cut because the government has no process in place for universities to send the newly required acceptance letters to the government.

This means that students who have been accepted can not attend courses that start in the summer 2024 semester. With cut sections, current Canadian students will have trouble getting courses, and may have to switch to part-time which changes their enrollment status and might trigger repayment of their loans or ineligibility for funding. I've seen this before. It wreaks havoc on the student loan borrowers.

Again, the Liberal government has messed up the education environment. Will the new system needed in a rush for the acceptance letters be the new Arrivecan scandal?

I call on the government to implement a slower phased in approach and delay the requirement of the acceptance letters until a process is in place to submit these letters.


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Post Options Post Options   Thanks (0) Thanks(0)   Quote kennerman Quote  Post ReplyReply Direct Link To This Post Posted: 28/January/2010 at 1:09pm
Sorry, one more question. Is there a difference between the 5 and 7 year mark when trying to have student loans included in a previous bankruptcy? A bankruptcy in which they had not been discharged, obviously.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Iknowalotofstuff Quote  Post ReplyReply Direct Link To This Post Posted: 28/January/2010 at 4:18pm
Yes.  The seven year period refers to the time a bankrupt or consumer debtor has to be out of school in order for the student loan to be subject to discharge.  Prior to July 7, 2008, the period was 10 years.  Example: A student ended his studies 2000 and went bankrupt in 2006 his classmate went bankrupt in 2008.  The student loans are not dischargable in the 2006 bankruptcy because the student was not out of school for 7 years.  However, the student loans in the 2008 bankruptcy are subject to discharge.  This is why I kept asking how long you had been out of school.

The five year rule applies only to a hardship application.  Any student loan debtor is eligible to make a hardship application if he / she is discharged and has ceased to be a full or part time student for five years.  Example:  Study End Date - May 2004  Consumer Proposal is successfully completed November 2009.  Trustee not discharged,  Consumer debtor can make a s. 178 1.1 application the day after successful completion as he is now discharged and out of school for five years.  
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Post Options Post Options   Thanks (0) Thanks(0)   Quote SolveStudentDebt Quote  Post ReplyReply Direct Link To This Post Posted: 29/January/2010 at 12:54am
The 7-year period replaces the previous 10-year limitation. The 5-year rule applies to cases whereas hardship is involved that would warrant an earlier discharge based on those circumstances.  
Solve Student Debt specializes in solutions for students and graduates in student loan default, and those at risk of defaulting.

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Post Options Post Options   Thanks (0) Thanks(0)   Quote kennerman Quote  Post ReplyReply Direct Link To This Post Posted: 29/January/2010 at 10:30am
hey i think you might be misunderstanding me a bit Iknowalotof stuff. I mean when applying to have your loans discharged in a previous bankruptcy. Like for example someone was out of school in 2002, filled in 2005. What would the difference between making an application to have them discharged under a previous bankruptcy in say 2007, and 2009? sorry if i wasen't clear. Thanks.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote kennerman Quote  Post ReplyReply Direct Link To This Post Posted: 29/January/2010 at 12:01pm
After 7 years you do not need to prove hardship to have it discharged under a previous bankruptcy? Sorry if I am making you guys repeat yourselves, this is all very new to me.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote kennerman Quote  Post ReplyReply Direct Link To This Post Posted: 29/January/2010 at 12:09pm
haha just to be clear what i am asking is, is it only possible to have student loans
included in a previous bankruptcy in the case of hardship? sorry I realize im making this  confusing.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote xtos Quote  Post ReplyReply Direct Link To This Post Posted: 03/February/2010 at 11:34am

Just to make sure. 

 

1     Do they count 5, 7 or 10 years from the Last End of Study Date that was funded by Student Loans?

 

------OR-----

 

2     Do they count (does the Clock Re-set), if you took any kind of course/program, anywhere in Canada or Outside Canada, but with NO GOVERNMENT FUNDING AT ALL?

 

 

3     Where can I find a List/Info on what constitutes as Hardship?

 

4     Is there a difference between, if you had the Permanet Disability when appying and using the Disability Grants during the time of study, compared to becoming Disabled after leaving school???  also, what if your Existing Disability that you had during your studies, got worse or you developed additional Disabilities after leaving school.

 

5         Is any of the above impacted, if the Program was NOT completed for whatever reason even if you wanted to finish, but the School's Policies have changed preventing you from Finishing???

 
 
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Post Options Post Options   Thanks (0) Thanks(0)   Quote ericsson12 Quote  Post ReplyReply Direct Link To This Post Posted: 05/February/2010 at 7:15am

I am looking for a lawyer to handle my hardship to include my student loan in Ottawa, Ontario. Do you guys have any lawyers names, information for me to contact?? Because I am overseas. So I can not be there phisycally to do it. Thanks.

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Post Options Post Options   Thanks (0) Thanks(0)   Quote kennerman Quote  Post ReplyReply Direct Link To This Post Posted: 05/February/2010 at 7:18am
Iknowalot of stuff, are you saying you have a 98% rate with your hardship  applications, for discharging under a previous bankruptcy?
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Iknowalotofstuff Quote  Post ReplyReply Direct Link To This Post Posted: 05/February/2010 at 4:05pm
Yes my success  rate is that high because I only take on clients who can meet the criteria based on my strict assessment process.   I will not just make an application to earn a fee.  
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Iknowalotofstuff Quote  Post ReplyReply Direct Link To This Post Posted: 05/February/2010 at 4:15pm
Keenerman:
A student loan is subject to discharge if the debtor has been out of school for 7 years at the date of bankruptcy.  If the debtor make an assignment or proposal before the 7 years has elapsed, he can make a hardship application one he is discharged provided he has been out of school for 5 years.  The seven an five refer to different provisions of the same rule.

Let's say you ceased your studies in 2002 and went bankrupt in 2005 and were discharged in 2006. You could make a hardship application any time after July 7, 2008 as you would at that date have ceased to be a full or part time student for a period of 5 years and were discharged.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote SolveStudentDebt Quote  Post ReplyReply Direct Link To This Post Posted: 06/February/2010 at 8:25am

The 7-year rule applies to those who bankrupt themselves on or after the coming into force of the legislative ammendment. So those who went bankrupt before the coming into force still have the ten-year rule in place. Theoretically, that would be an opposition's argument.

Solve Student Debt specializes in solutions for students and graduates in student loan default, and those at risk of defaulting.

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Post Options Post Options   Thanks (0) Thanks(0)   Quote Iknowalotofstuff Quote  Post ReplyReply Direct Link To This Post Posted: 06/February/2010 at 11:37am
Your post is absolutely incorrect.  The effective date of the amendment to the 10 year rule reducing it to 7 was July 7, 2008.  Suppose a student loan debtor's end of study date is April 30, 2000.  Suppose they make an assignment in bankruptcy on June 1, 2008 when the 10 year rule was still in effect.  They obtain their discharge on April 1, 2009.  Would their student loans be subject to discharge?

According to your post above, the student loans would not be subject to discharge as the debtor was not out of school for 10 years at the date of bankruptcy.

If this is your advice, it would be wrong.  The transitional provisions provide that if the debtor was discharged after July 7, 2008 AND was out of school 7 years at the date of bankruptcy, the student loans become subject to discharge regardless of the 10 year rule at the date of bankruptcy.

I recently had a client who went bankrupt in 2000.  She was never discharged.  She simply failed to fulfill her duties.  She forgot about her discharge until she was sued and garnished by her student loan creditors in 2009 - 10.  The bankruptcy fell of her credit file in 2007 and she was re-establishing herself.  Her end of study date was 1993.  At the date of bankruptcy, she was subject to a 10 year rule having  been out of school only 7 years.  I obtained her discharge for her in January 2010.  Guess what happened to her student loans and the judgment obtained by HRSDC. Upon her discharge, her student loans became subject to discharge, the judgment became subject to her discharge and the garnishment stopped.  This should not have happened according to your advice.

For those who went bankrupt under the ten year rule and have been discharged, they have 3 options:  (1) pay the debt;  (2) go bankrupt again since they have been out of school for 7 years or (3) make an application under s. 178 1.1 to have the student loans subject to their earlier discharge.  If they cannot pay and a second bankruptcy under today's new rules would be very devastating, the s. 178 1.1 application makes sense.  It can be made at any time after discharge for anyone out of school for 5 years regardless of the 10 year rule in effect at the date of bankruptcy.  Bankrupts have already suffered the consequences of bankruptcy.  A s. 178 1.1 application can not make the situation worse.  If it fails you are exactly where you were before the application.  No harm ... no foul.

Let me repeat so no one is confused by Johnny's post.  The 10 year rule applies only to those who were not out of school 10 years and were discharged before July 7, 2008.  The seven year rule applies to anyone out of school for seven years and discharged after July 7 2008 regardless of whether they were previously subject to the 10 year rule at the date of bankruptcy.  Any debtor who has been discharged and has been out of school for five years and their loans are not subject to the discharged explained above can make an application under s. 178 1.1.  A successful applicant must demonstrate good faith and financial hardship according to the Act.

Johnny, your post only adds to the confusion that abounds the 1, 2, 10, 7 and 5 year rules that have existed under rule 178.  


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Post Options Post Options   Thanks (0) Thanks(0)   Quote Iknowalotofstuff Quote  Post ReplyReply Direct Link To This Post Posted: 06/February/2010 at 11:44am
Ericsson12:
If you ask he webmaster to give you my email address, I will help you at nominal cost to make a s. 178 1.1 application.  You do not need a lawyer.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote SolveStudentDebt Quote  Post ReplyReply Direct Link To This Post Posted: 06/February/2010 at 4:42pm
It is not what I came up with Stuff. It is what lawyers have advised me. Are you an attorney?
Solve Student Debt specializes in solutions for students and graduates in student loan default, and those at risk of defaulting.

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Post Options Post Options   Thanks (0) Thanks(0)   Quote SolveStudentDebt Quote  Post ReplyReply Direct Link To This Post Posted: 06/February/2010 at 4:55pm
Reduction of the student loan discharge period from 10 to 7 years. This amendment will apply where the debtor obtains his or her discharge on or after July 7, 2008 (PROVIDED that at the time they filed they had ceased to be student for the required seven years) or the debtor had or becomes bankrupt on or after July 7, 2008. 

The amendment that will reduce to five years the period a bankrupt will have to wait to make a “hardship” application to have student loan debt or obligation discharged (BIA , s. 178(1.1) is also now in force.  This amendment applies to all debtors notwithstanding when the bankruptcy or the process that results in the bankruptcy is initiated.
Solve Student Debt specializes in solutions for students and graduates in student loan default, and those at risk of defaulting.

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Post Options Post Options   Thanks (0) Thanks(0)   Quote Iknowalotofstuff Quote  Post ReplyReply Direct Link To This Post Posted: 07/February/2010 at 3:21am
This clarifies your earlier post.  A student may have made an assignment under the 10 year rule but because their discharge was after July 7, 2008 the s. 178 1(g) period was reduced to 7 years.  It is the date of discharge that determines whether whether the period between the end of study date and the date of bankruptcy is 7 or 10 years.   

I do not understand how what your stated in your earlier post could be an "opponent argument"?

Question:  We both agree that some student loans may be subject to a limitation period established in the province where the loan was granted or under certain provisions of Canada Student Loan Act or the Canada Student Financial Assistance Act.  What is the difference between a previously bankrupt debtor making an application under s. 178 1.1 to deal with their student loans when they do not have the ability to pay or a non-paying student debtor using the SOL to argue that they do not have to pay any more?  I don't see much difference between these options.

The is use of a SOL defence is the use of a technicality to prevent from being sued.  The debt is still owing even if it cannot be collected.  A successful application under s. 178 1.1 renders the debt subject to an "earlier" bankruptcy discharge and the debt is no longer owing to the student loan creditor.  Provided the debtor has established to the satisfaction of the student loan creditor or the court that they have acted in good faith and are experiencing and will continue to experience financial hardship with respect to their liabilities under the loans, they will no longer owe the money.  

Do you assist your clients in making s. 178 1.1 applications if they qualify?  Do you insist that former bankrupts try to pay the loans even if they could meet the requirements of s. 178 1.1?  I am just trying to figure out what it is that you do?

Several years ago, non-profit CCS were government programs.  In some provinces such as Ontario, CCS received funding from the Ministry of Community and Social Services.  The NDP government decided to cut the funding.  It was assumed that Ontario would opt into the OPD progran as other provinces had OR they would get funding doing the mandatory counselling new to the BIA and become administrators of consumer proposals.  This never happened.  The funding was never restored.  This happened in the early 1990's  Most non profit CCS are funded partially by the United Way or religious organization in addition to the amount received from credit grantors.  CCS were reluctant at first to accept this funding but out of a sense of survival found they had no other choice.  You paint them with the same brush as for profit debt poolers that they are not.  I find your comments about these non-profit United Way agencies as a bit self-serving?  My comments are made as I ran one of these agencies for 20 years.  

 
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Post Options Post Options   Thanks (0) Thanks(0)   Quote SolveStudentDebt Quote  Post ReplyReply Direct Link To This Post Posted: 07/February/2010 at 12:35pm
"What is the difference between a previously bankrupt debtor making an application under s. 178 1.1 to deal with their student loans when they do not have the ability to pay or a non-paying student debtor using the SOL to argue that they do not have to pay any more?  I don't see much difference between these options."
 
First let's distinguish a fact. If an individual can pay a student loan that is statute barred then he or she should. I voice this all the time. If people come to me looking for escape then I do not assist. It is that simple. THe resaon I am bringing this up is because you are clearly of the view that a limitation issue really does mean the person it applies to does not have to pay any more. As said above, I do not take that position because it is the wrong position to take. Look Stuff, you have an assessment process and so do I and this demonstrates to the system that people actually are not what the system accuses them of. A cultural viewpoint if you will. 
 
 
One significant difference between a section 178 and the use of a limitation issue is very clear. Section 178 is a bankruptcy proceeding. This proceeding does cvome with imnplications in redspect of credit reporting. In the limitation arena it does not in most cases. A limitation issue is not a porthole of careless or neglectful escape in my realm of business.
 
The major difference here is that people who are able to pay benefit from doing what is right when The CFW Group is involved. I am going to tell you something, Stuff. I have done volunteer work for more Canadians in financial distress than you could fathom. If the case warrants it I still do it today. My business is all about helping people make better choices that align with economic wellness, social stability, turn-around management, and healthy consumerism uninhibited by the warped culture and bias within Canada's financial community. Consumer and corporate bankruptcy is not what Canada needs to see an increase of. 
 
Now, a section 178 is just the conclusion to bankrupty. It does not help the individual recapture their true identity back. I wish it did buit it doesn't. If an individual cannot repay a debt because they will never ever be able to get out from underneath it, and a section 178 is in order, then it is an awesome prescribed solution.  
 
" The is use of a SOL defence is the use of a technicality to prevent from being sued.  The debt is still owing even if it cannot be collected."
 
If a debt is statute barred then it is a defense.
 
You are incorrect about the life of the debt after it has been deemed barred. Some provincial governments may take the position that this is case. However, if they are challenged then the result is quite different. The problem is that much of the consumer population does not have the financial ability or patience to challenge. The limityation of actions and proceedings states that no action or proceedings can be taken. Some take the position that this applies to "legal action and proceedings" only. I know this not to be the case.
 
"Do you assist your clients in making s. 178 1.1 applications if they qualify?"
 
Read the above response. I provide people with the navigation towards it in the event someone asks me. I simply advise them to seek out the navigational tool provided by the registrar's of provincial bankruptcy courts. I am gathering them for those people who contact me to ask about a section 178 application. If I make an assessment whereas a section 178 application would be the best option, then direction is given. If I knew you I would refer people to you. I just don't know you.
 
As for the non-profit debt poolers out there that I know of, I fail to see how they can actually represent themselves as non and not-for-profit. You have a debt pooler out here in the east who is engaged in these massive television commercial campaigns. This is over a million-dollar per year expense. In your world there is such thing as a not-for-profit business. In mine there is not.
 
1. Debt poolers service the financial industry first - the consumer last.
 
2. Debt poolers do not assist people in any significant way when it is deemed that they do not qualify for a debt management program. They simply tell people to hide from the collectors until bankruptcy can be actioned (or go underground and live the life of a gopher until the limitations come in to play). If they are calling themselves counselors then they should counsel in one productive way or another. It is that simple.
 
3. Debt poolers depend  on the commission earnings from the financial industry for survival. That places the primary incentive as getting people to sign up into a debt management program in order to make money.
 
4. Look at their financial and bank records online and see how many millions of dollars are earned - and spent on salaries and advertising. It is incredible.
 
5. Not-for-profits are able to make more money now that they are private and so connected to the financial industry on a fee-for-recovery basis. I  don't need to make that much money - and The CFW Group's business methodologies are more able to service the consumer population.
 
6. The CFW Group's Student Crisis Service Division earns fees for services by it's clients. Not a commission from creditors or any component of the financial industry. The CFW Group is involved in other things than educating, coaching, or intervention for the consumer population.
 
You have to understand that I am not knocking you for running one of those businesses. I am not knocking your expertise in your particular areas of business. The not-for-profit credit counseling industry does need change I can tell you that. It needs to be pro consumer. I find it quite interesting and I applaud you for it. You are confrontational and I respect that. You have to be in order to face the ugliness of systemic failures and obtuse internal policies that the financial community conjures up. We both face these barbaric fronts and this is where you and I are so much alike.
 
Johnny     
 
 
 
Solve Student Debt specializes in solutions for students and graduates in student loan default, and those at risk of defaulting.

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Post Options Post Options   Thanks (0) Thanks(0)   Quote Iknowalotofstuff Quote  Post ReplyReply Direct Link To This Post Posted: 08/February/2010 at 8:10am
This site is designed to give debtors particularly student loan creditors non bankruptcy options.   These non bankruptcy options include for profit services (like yours and 4 Pillars), non-profit services (like CCS), for profit debt poolers and consultants.  Your position is that in order to get client oriented service the service should be paid for by the debtor.  Any service paid for by the creditor is self serving and suspect because of the inherent conflict of interest.  I would disagree with respect to non-profit charitable organizations.  

A nonprofit organization (abbreviated NPO, also not-for-profit) is an organization that does not distribute its surplus funds to owners or shareholders, but instead uses them to help pursue its goals.  In Canada, NPOs may be formed at either the federal or provincial levels. Charities must generally be registered with the Canada Revenue Agency and may issue tax receipts for donations.  The funds received from credit grantors are charitable donations.  This is the difference between for profit debt poolers and collection agencies.  All of the funds generated from debt repayment programs are invested in assisting clients not generating profit.  

As long as there is credit, there will be credit problems.  I equate credit to tobacco.  Both are legal. Both are addictive.  Both cause problems for society.  Both the purveyors of credit and tobacco should be part of  a cure.  I see the charitable donations as investments in a cure for the problems created.  There is no doubt that the donations are self serving but they are still donations into programs that help people. 




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I remember one 'not for profit'   place I took some courses.  The 'school' paid licensing fees to a parent organization that miraculously exactly equaled the surplus income of the 'school', therefor the 'school' could claim they were non profit and not for profit.   The parent company earned millions for its shareholders....   Clever setup, clever accounting, very profitable.  Just pay out the profits in high salaries and you can be not-for profit.  The company shows no profit but employees/owners clearly benefit.

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