Sign up for Canadastudentdebt Newsletter!
(Registration is separate from Forums)
E-Mail Address:
First Name:
Last Name:
Subscriber Action:


I personally recommend CFWGroup.
- Mark O'Meara, Canadastudentdebt.ca
  New Posts New Posts RSS Feed - Canada Student Loan Settlement, is it possible?
  FAQ FAQ  Forum Search   Register Register  Login Login


Canada Student Loan Settlement, is it possible?

 Post Reply Post Reply
Author
TympanicMembrane View Drop Down
Newbie
Newbie
Avatar

Joined: 14/May/2008
Location: Manitoba
Points: 1
Post Options Post Options   Thanks (0) Thanks(0)   Quote TympanicMembrane Quote  Post ReplyReply Direct Link To This Post Topic: Canada Student Loan Settlement, is it possible?
    Posted: 14/May/2008 at 2:14pm
Hi all.....

I'm about to write a letter to the Canada Revenue agency to make an offer on debt Settlement? Has anyone had any success with this, and have any suggestions?

The background: In the early 90's I went to university to get into nursing. Now, I have had problems with ear infections since I was a kid, and it became apparent, I was suffering in my classes and often couldn't hear.  I applied as a student with a permanent disability which allowed me to take a reduced course load, and still receive student loans. I did receive a special opportunity grant for hearing aids which helped, but I took a LOA from university when I realized I could not hear anything from a Stethoscope. While on my LOA, I was traumatized by the student loan system (but that is a diff story). I also found an amplified stethoscope and resumed my education till I Graduated in 2002. The gist of the story being, I had an extended stay in university, with a much higher student debt  of $80k (student loans, student line of credit.)

The Problem: Initially I was overjoyed I was finally done and could start life. But it became quickly apparent that my student loans were a problem.  I immediately applied for interest relief, but was rejected. I appealed and was rejected. I attempted to negotiate the longest payment time frames, even with that the minimum payments were incredibly difficult.  The final straw was when the Royal Bank debited my account a week before payday leaving me with $14.00, even though I had arranged to make payments manually.  I moved to a new credit union and simply ignored them. I ignored the provincial loans people for a while, but when they finally contacted me I found them quite pleasant and helpful. Generally my student loans descended to hell, and my credit went to hell. I became pretty depressive since graduation. Even with a decent job & income the student loans were impossible. I often think about the choice to go to university, my delayed entry to the workforce, and likely early exit from the workforce due to my ear infections.

The Present: I continued to ignore the Royal Bank to this day, and briefly their loans were in collections. Now they are simply listed as bad debt. I paid off my loans negotiated through the province, and the garanteed portions the RBC sent back to them. I have basically been paying interest on the federal negotiated loans until this last year, I calculated payments over 10 years, and just started send them the payments. What has happened recently, My father passed away and left me some property. I now have the equity to borrow money and pay off the student loans. The Royal bank was happy to settle their remaining portion at 80%.

The Task: I contacted Canada Revenue agency today, and simply asked about the possibility of making a debt settlement. They very promptly gave me a mailing address to a debt management branch of Canada Revenue agency and gave me instructions to make an offer, state my reasons and where the money would be coming from.

The Question: As I asked above, does anyone have any knowledge of this process, what they would likely settle for, or how to proceed with this letter of making an offer?

Michael
Michael
Back to Top
Sponsored Links


Back to Top
Johnny View Drop Down
Moderator Group
Moderator Group
Avatar

Joined: 05/November/2003
Location: Canada
Points: 5416
Post Options Post Options   Thanks (0) Thanks(0)   Quote Johnny Quote  Post ReplyReply Direct Link To This Post Posted: 15/May/2008 at 8:08am
The government does not settle very often. Theyy will respond to you within 90 days. If your situation is not dire with extenuating circumstances, they will reject. Each case is unique and I wish you the best of luck. see what happens.
The Canadian Financial Wellness Group (CFWG)

www.cfwgroup.ca
Back to Top
artschoolidiot View Drop Down
Newbie
Newbie


Joined: 26/May/2008
Points: 1
Post Options Post Options   Thanks (0) Thanks(0)   Quote artschoolidiot Quote  Post ReplyReply Direct Link To This Post Posted: 26/May/2008 at 12:00pm
Hi Michael,
I am in a similar situation and would be interested to hear of your progress, if any, with this.
Regards,
The Art School Idiot
Back to Top
Johnny View Drop Down
Moderator Group
Moderator Group
Avatar

Joined: 05/November/2003
Location: Canada
Points: 5416
Post Options Post Options   Thanks (0) Thanks(0)   Quote Johnny Quote  Post ReplyReply Direct Link To This Post Posted: 26/May/2008 at 7:10pm
That is one of the reasons that the CSLP does not encourage settlement offers. Ermm
The Canadian Financial Wellness Group (CFWG)

www.cfwgroup.ca
Back to Top
Old Stewdent View Drop Down
Newbie
Newbie


Joined: 22/April/2008
Points: 4
Post Options Post Options   Thanks (0) Thanks(0)   Quote Old Stewdent Quote  Post ReplyReply Direct Link To This Post Posted: 26/July/2008 at 10:17am
I find myself in a similar situation with ARC-Accts Recovery Corp based in BC. I still owe 18 K after attending 4 yrs univ. last yr was 2001. CRA just took the last of their federal loans from income tax this past year - but provincial loans still in default. I found this web site incredible for the info with st. loans. thank you for putting it out there. So, my question is - how much "haggling" is done while trying to settle a loan with collection agencies?
Back to Top
Johnny View Drop Down
Moderator Group
Moderator Group
Avatar

Joined: 05/November/2003
Location: Canada
Points: 5416
Post Options Post Options   Thanks (0) Thanks(0)   Quote Johnny Quote  Post ReplyReply Direct Link To This Post Posted: 26/July/2008 at 9:18pm
Depends on whether or not the debt is owed to a government or a bank. Each case is very unique. Either way, the only way you will get a fair deal is to haggle. Collection agencies are in the business to earn a commission. So, they are going to attempt to collect as much money as they can. It also depends on your financial situation, which the loan provider will review.
The Canadian Financial Wellness Group (CFWG)

www.cfwgroup.ca
Back to Top
dbenton View Drop Down
Newbie
Newbie


Joined: 31/October/2008
Location: Ontario
Points: 1
Post Options Post Options   Thanks (0) Thanks(0)   Quote dbenton Quote  Post ReplyReply Direct Link To This Post Posted: 31/October/2008 at 7:22am
Sorry i am new. I declared bankruptcy in 2003 and was discharged in 2004. Now it is late october 2008 and i get a bill for my studnent loan for 20000 and almost $7000 interest. I want to make an offer to settle but am told because it is a Canada Student loan i cant. Is this true? I am a single income, wife hurt and unable to work due to a car accident and a son that is disabled. I have a huge issue with the interest charge because in my view they could have waited even longer if they wanted and just make me pay the interest when they felt like giving me the bill! It is not as though i was given the chance to pay back the loan after my discharge the government just waited until now...any why? who know but thoses interest charges seeem bogus. I want to make a one time lump sum payment for about $15000 is this still possible or am i out of luck? Also the collection agency told me that i can pay the principal and have a letter drafted by a lawyer disputing the interest charges. I need advice and HELP..anyone? Thanks
Don
Back to Top
Johnny View Drop Down
Moderator Group
Moderator Group
Avatar

Joined: 05/November/2003
Location: Canada
Points: 5416
Post Options Post Options   Thanks (0) Thanks(0)   Quote Johnny Quote  Post ReplyReply Direct Link To This Post Posted: 31/October/2008 at 11:20pm

Collectors who tell you to do that are breaking the rules. IS it possible to settle? If you owe the government of Canada, good luck. It is not easy.

The Canadian Financial Wellness Group (CFWG)

www.cfwgroup.ca
Back to Top
DonGautreaux View Drop Down
Newbie
Newbie


Joined: 03/March/2009
Points: 5
Post Options Post Options   Thanks (0) Thanks(0)   Quote DonGautreaux Quote  Post ReplyReply Direct Link To This Post Posted: 05/March/2009 at 10:50pm
Settlement agencies are more an advantage to the lenders than to the borrowers. They collect money from the borrower, and thus the lender is assured that they will be paid their due amount.
Back to Top
Johnny View Drop Down
Moderator Group
Moderator Group
Avatar

Joined: 05/November/2003
Location: Canada
Points: 5416
Post Options Post Options   Thanks (0) Thanks(0)   Quote Johnny Quote  Post ReplyReply Direct Link To This Post Posted: 06/March/2009 at 3:17am
That is what debt poolers do. They work for the creditors, and the creditors pay them a commission. These groups are the new age collection agencies.
The Canadian Financial Wellness Group (CFWG)

www.cfwgroup.ca
Back to Top
DonGautreaux View Drop Down
Newbie
Newbie


Joined: 03/March/2009
Points: 5
Post Options Post Options   Thanks (0) Thanks(0)   Quote DonGautreaux Quote  Post ReplyReply Direct Link To This Post Posted: 09/March/2009 at 11:34pm
You are facing the problem with the government policies so you have to face this problem very firmly .
Back to Top
wesgull77 View Drop Down
Newbie
Newbie


Joined: 13/February/2010
Points: 5
Post Options Post Options   Thanks (0) Thanks(0)   Quote wesgull77 Quote  Post ReplyReply Direct Link To This Post Posted: 13/February/2010 at 11:52am
I am in complete shock. I had a student loan in 2000 for $8K. I made monthly payments on it up til I went through a bankruptcy in 2003. After the discharge I called my loan provder (Bank of Nova Scotia) to set up payments again. They said they had sent it to collections and gave me their number. I called collections and they said they sent it back to the bank. So.. I called the bank back and was told the account was closed. I asked what that meant and he said it was written off and no payment was due anymore.

 Well, 7 years later (3 days ago), I get a call about my student loan from a collector. I asked what was going on, told them what I was told 7 years prior,  and they said I got bad advice. I now owe $14,000. I only make $22,000 yearly and have 3 dependents and am at my limit as far as monthly payments (Mortgage, car payment, 2 credit cards. loan, plus living expenses). What the heck can I do. I cant go down another bankruptcy. Why would I be told 7 years ago that it was closed, and then have it opened and expect to pay + the 7 years of interest on top!!!
Back to Top
Johnny View Drop Down
Moderator Group
Moderator Group
Avatar

Joined: 05/November/2003
Location: Canada
Points: 5416
Post Options Post Options   Thanks (0) Thanks(0)   Quote Johnny Quote  Post ReplyReply Direct Link To This Post Posted: 14/February/2010 at 5:27am
This is a classic case of being misinformed by a service center representative who obviously didn;t know the process. It is possible that there is a limitation there. Be cautious about how to approach this matter I would say. Is the agency assigned by Scotiabank called  Accounts Recovery Corporation on the off chance? If you want this remedied you can contact me if you want to.
 
Johnny
The Canadian Financial Wellness Group (CFWG)

www.cfwgroup.ca
Back to Top
wesgull77 View Drop Down
Newbie
Newbie


Joined: 13/February/2010
Points: 5
Post Options Post Options   Thanks (0) Thanks(0)   Quote wesgull77 Quote  Post ReplyReply Direct Link To This Post Posted: 17/February/2010 at 4:46am
What kind of limitation are talking about? Can you give me your email so I can contact you? Mine is wesgull@****
Back to Top
wesgull77 View Drop Down
Newbie
Newbie


Joined: 13/February/2010
Points: 5
Post Options Post Options   Thanks (0) Thanks(0)   Quote wesgull77 Quote  Post ReplyReply Direct Link To This Post Posted: 22/February/2010 at 11:47am
I haven't heard from you... wondering if you are still interested in taking up my plight?
Back to Top
sdavis77 View Drop Down
Newbie
Newbie
Avatar

Joined: 02/March/2010
Location: Ontario
Points: 1
Post Options Post Options   Thanks (0) Thanks(0)   Quote sdavis77 Quote  Post ReplyReply Direct Link To This Post Posted: 02/March/2010 at 8:31am

It is true that our Government does not settle often, but they do settle.

 

I, like many others former students, ran into an overwhelming amount of financial difficulty when "life" hit hard. For me, the problem was targeted with the onset of an illness of my spouse, and from there, rejection of my eligibility to receive OSAP, due to the bank's decision to default me while still attending schools "for reason to believe I would eventually default", due to our credit scores. I went from a family of several vehicles and the potential for two $100k+ incomes to nothing.

 

The knowledge that I can share, is my success in attaining a reasonable settlement came from two realities. 1) I needed the settlement, and then still needed it 10 years later; and 2) I was able to assert my rights, and demonstrate my need through an in depth financial disclosure and projection of my future income. It took me 10.5 years, and then proof that I would be in this same position for another 10 before I was taken seriously.

 

I was in default before school ended, so I never repaid the banks - it went straight to the Governments of Ontario and Canada. I was not able to finish school as a result. I had no success with my pleas with either collection agency, until my CSL were transferred over to HRSDC for collections (which happened, as I ended up with an EI overpayment that went to collection, and the Gov't Canada places all debts with a single collector). I was then able to propose my settlement, and I was handed off to an auditor on file to determine my need. Once the Government of Canada agreed to settle, the Government of Ontario followed suit. But I still had to go through the Ontario collection agents who were nasty, rude, and required me to have them directed by the Government of Ontario to communicate with me in writing.

 

You have to remember, that our Government bodies are not interested in seeing any of us suffer, and there is always a way through. The Government of Canada makes their decisions based on their standards of living for a family of your size, meaning, you should ask for those expectations, and see to it that you live within those limits. For example, at the time I was in this situation, food was considered "normal" if you were $200 for the first adult, $100 for additional adults, and then $50 for each child. If you food budget met that that range, it was acceptable. So when making your applications, make sure you are reporting the actual costs of your expenses, don't estimate, but track it - and live to what is considered the acceptable range. Following the government's set guidelines makes it impossible for them to decline your inquiry for non-payment assessments.

 

The real key to success with any disagreement where you are looking to succeed is documentation.

 

My suggestion, would be to never give your banking information, ALWAYS respond to them, in writing, via traceable means, (I used both fax, and then would register mail a copy of my fax to them). Request they communicate to you in writing, and until you are in the phase of actual discussions with the officer who makes the decision, only respond to written inquiries from them. Ask them to not call your home, and only send you written requests. Ignore the phone calls, and each time you get a letter, responds to it immediately (7-10 days), always directing them to write you back, and always ask something of them they need to respond too. Make sure they always have your primary address on file.

 

It doesn't take long before the collection agents have allowed you to set yourself up to demonstrate how keenly interested you are in resolving this matter, and how blantenly they have ignored you. If you demonstrate your constant interest in responding to their requests, and your desire to pay - when you eventually have the means, then you are in a far better bargaining position. I always paid them each month, as well, even sent in years of cheques for $1.75 each month during the times I really had no money. They cannot refuse your payment, even though many of them say they cannot accept your payments less than a certain amount.

 

I was able to find success in my challenge and request to reduce my debt, only because I:

- kept all my documentation in an order I was able to reference

- I keenly expressed my interest in paying, and demonstrated why I was unable to pay, by adhering to budgets set by our federal government, and submitting my documentation to prove it.

- I kept the communication open, even with hostile collectors, only in writing

- I went over the collectors "heads" every time was necessary, and 9/10 times that went no where

- I paid them, even small amounts, and more if I had more

- And most of all, I researched and protected my rights whenever I could.

 

In the end, when I made the proposal, all that really mattered, was my ability to demonstrate my honest efforts to attempt to resolve the situation over the previous 10 years. I believe that my documentation showed how unfairly targeted I was. And my honestly and transparency is what led the agent to trust I really was in the position I was in. I also calcualted my average annual income during the years past, and my expected average annual income going forward.

 

Many of us who end up here are legitimately here - but few people I have met hold up their end of their responsibilities when being harassed.

 

I hope something I post here, helps someone else through...I know how horrible it feels, and how hopeless it can feel too.

Back to Top
calgarjay View Drop Down
Newbie
Newbie


Joined: 12/March/2010
Points: 1
Post Options Post Options   Thanks (0) Thanks(0)   Quote calgarjay Quote  Post ReplyReply Direct Link To This Post Posted: 12/March/2010 at 2:40pm
I just got a phone call for the first time from the CRA, they've never contacted me over a loan before. It's probably been 6 years since I paid on those loans (in the mean time I did pay off a student credit line of $20,000).

I have two questions.

Should I wait and hope that those loans fall off my credit rating soon???

Can the CRA garnish wages or will they just continue to keep any tax refunds?? I'm wondering what tools of enforcement they have that another creditor may not usually have or use??
Back to Top
jackshalack View Drop Down
Newbie
Newbie


Joined: 19/March/2010
Points: 2
Post Options Post Options   Thanks (0) Thanks(0)   Quote jackshalack Quote  Post ReplyReply Direct Link To This Post Posted: 19/March/2010 at 3:41pm
I was just called by the CRA too. I've had an outstanding OSAP debt of about 10K for about 5 years. So far they have been satisfied with just taking tax refunds... I'm kind of surprised to hear from them actually.
Back to Top
 Post Reply Post Reply
  Share Topic   

Forum Jump Forum Permissions View Drop Down

 

 

Jerseys