new with SL debt and questions

I'm new here and have been avidly reading all the forumd for the last 2 days.

I have some questions, and a story thats similar to many others I have read here.

Please can someone explain exactly what "stats barred" means? And when does it apply?

First up our story.

My name is Cesca (not my real name of course) and I was never a student here in Canada - but my husband was.  I am actually a new immigrant and do have a student loan still unpaid from my native country but thats another story altogether.

Anyway we got married in 2000.  DH's (dear hubby) student loans were all taken out BEFORE we were married so that I am not in any responsible for them, nor will I allow myself to become responsible for them.

Anyway  DH graduated from college in 1997, with about $16,000 of student loans. He was never able to get a full time job - most of it was seasonal and contract work. and he was applying for interest relief on the loans during this time as well. By 1999 he was becoming ill and eventually had to go on welfare (Ontario Works - we live in Toronto). He started the process of applying for Disability through ODSP. 

During the time he was working part time, contracts and summers, he racked up about $40,000 of debt on several credit cards, including helping to pay for our wedding. We got married in 2000.

DH was finally accepted for ODSP in 2001, and he's been on it ever since. Thats all the income he has been getting. I was not working at all (due to my immigration status - but again thats another story). By the end of 2001, I was pregnant and the bills were getting over our heads since he was paying out more than half the monthly income on minimum payments. He decided that he had no choice but to declare bankruptcy. So he did. Declared in Late 2001. Discharged in 2002. Ironically our son was born while he was an undischarged bankrupt.

THe next step was to then apply for loan forgiveness from the banks (Royal Bank) and OSAP for the student loans. Most of 2003 went on acquiring the medical reports necessary for that, as well as waiting for several months for the certificate of discharge to show up.

Eventually we were told by OSAP that $12,000 was to be forgiven and that $4000 was still to be paid back. It is my understanding that this $4000 was the "unsecured" part of the student loan.

The $4000 sat on his bank statements for a while. DH didnt pay anything, noone ever sent him anything to say that he had to pay or how much to pay. Noone ever mentioned interest relief either.

Then one day we noticed that the $4000 had disappeared from the bank statement. DH asumed that that portion was now forgiven as well.  This was the FIRST MISTAKE. We should have called to find out what happened to that $4000.

On August 1st this year (2004) DH's account was frozen. The bank claimed that the amount of $400 was needed to pay towards the outstanding balance of the student loan. We needed that money to pay our rent which was due that same day. DH got on the phone and had a chat. The bank kept demanding that he pay up. He kept saying. "I'm on a disability and cannot afford to pay. You're holding my rent and if I dont pay my rent today my family and I will be out on the street."  

Anyway they unfroze his account, so we could pay the rent. Shortly after another phone call from the bank said that they were sending his SL to the collections agency. DH said, "Hey you do what you gotta do. My credits no good anyway since I went bankrupt. I'll be happy to prove my income level to a judge."

On August 10th 2004 (just 10 days later) we got the first call from the collections agency (Alliance One) at 0815 am!!. THey havent stopped calling since then. I've been the one who scresns the call. I simply say that DH is unavailable. I've kept this up like a broken record. DH's disabilty means that he spends most if his time in bed. He's up in the evenings to spend time with our son, and he has to use a scooter (3 wheels with engine) to get around.

Oh yeah, DH did receive a Financial Questionaire from Alliance One, but has no intentions of filling it in and returning it - its due back tomorrow (27th) actually.

Todays call was different. The CA accused me of not behaving in a professional manner. I have never raised my voice or gotten upset. I've always said that "DH is not available. Who's calling please. And that I would pass the message on." Which I do. Its not my problem that DH doesnt return his calls. :)  Anyway the CA mentioned something about "rectifying the situation".  "Ma'am, DH has been unavailable for a month now. When will he be available?"  I keep replying that I don't know, but I will pass the message on. CA muttered something about his office. So I asked what his office was called. There was a pause and then he said "Alliance One" as if he did not want to mention it.

Up until now when I answer the phone, the CA has never identified themselves by name or business unless I ask. And then its only as W from Toronto, or W from Scarborough, or B from North York.

Even though I am not the debtor, shouldnt the CA still be identfying himself to me before I pass the phone to DH? (of course I'll never pass the phone over)

Does this mean he might want to declare justice  - not sure if thats the right way to express - to take DH to court?  When the calls first started DH has always said that he would happy to make arrangements to pay off the principle, but he refused to pay the horrendus interest charges the CA was mentioning. The early calls said the interest was $2 a day (thats $60 a month). The later calls now say $1 per day.

So today we sent a Cease and Desist letter to Alliance One - by certified mail.

I am aware that this may mean that the debt might be sent back to the bank or to another CA, but we'll deal with that when it happenes. DH actually wants his day in court to prove to the judge his level of income and that he truely cannot pay.

He cant ask his family - most of them are on either welfare or ODSP or low paying jobs as well.

So what do you guys think?? 

I really need to know "stats barred" fits into all this?

Thanks

Cesca

If your disability reduces your ability to work, then you should be applying for disability. If approved, your loans would be removed from active collection.

Your disability has to reduce your ability to participate in the workforce, and it must be permanent.
There are medical forms to fill out and financial statements to be provided. Its not easy to qualify for. HRDC doesnt agree to it very easily. Your disability has to occur within 6 months of graduating.

The collection agents wont tell you this because they want their commission.

Contact the national student loans centre and apply for disability for your student loans. According to HRDC's interpretation of the policy, if you are single making less than $1604 per month net, then you would qualify. This amount could be challenged though....

With disability, the loan remains on the books, but out of active collection.

-------------------

I found this  on another forum written by Mark Meara (the owner of this website I beleive).

If the last statement above is true, then why are the CA's actively chasing my DH's debt when he is on a Disabilty, has been for the last 3 years and can prove it???

Could it have something to do with statute of limitations running out?

Cesca

Cesca,

One concern......is sending a cease and esist order considered acknowledgement of the loan? I could be wrong, but you do not necessarily have to make a payment to acknowledge a loan.

I far as I understand it ....the clock is reset after your DH was realeased from bankruptcy ......so you have a long way to go .....the same thing happened to me ....

 

Good luck

 

Regarding the disability and HRDC, they many have neglected to inform the collection agency of the loan forgiveness, which is not really loan forgiveness, but removal from active recovery...

Mark

This is a matter of law. Therefore NOBODY can say anything for sure. That's why God in his wisdom and mercy gave us judges and lawyers.(Or maybe He just has a very twisted sense of humour).

What we're saying is that if a debt goes unserviced and anacknowledged for a statutorily defined period of time (that depends on the nature of the debt and different ones can have different limitation periods), it becomes legally unenforceable. You'd be best off talking to a professional who has a complete picture of your particular case.

As to how to drop off the radar screen; I don't think that's really a viable option in your case. It can be done and has been done by some of us (me included). It is a radical approach and not recommended in many cases.

This is not just a matter of not answering the phone or being really really quiet when the process server knocks on the door. Please note where I live to get some idea of the steps that need to be taken if you choose flight over fight.

 

Talking about what the CA knows and dont know - at one time they told CA that "you signed a contract for $4000. Now be a man and face up to your responsibilities."  They have no idea that this $4000 is just the unsecured portion of a larger debt.

It's not DH's fault that he became ill and had to go on a disability. CA's also dont seem to have any idea just how much someone on ODSP gets per month!! And they dont care either.

Cesca

Cesca,

I'm not sure you are going to find what you are looking for. You've asked for information about how to "duck below the radar". Unfortunatley, if ducking below the radar was that easy, we all would have done it a long time ago. There is no "underground railroad".

My only advice would be to find out more information regarding how DH's disability affects the status of the loan. Given the fact that the clock has been reset, that's your best avenue to explore.

Other than that, there are only three options:

1. Don't pay them and continue to deal with the harrasment (being fully aware of what the CA can and cannot do) until the statute does run out.

2. Acknowledge the loan and start paying them.

3. Run. Leave the country.

Sorry......but at the end of the day those are the options.

Ok so sending the letter was the wrong thing to do. And the clock has been reset to sero as of whenever they sign for it (today or tomorrow). :(

Ok so if we were to start paying a small amount - even if  a money order sent every month for $20 each month - that wont even touch their interest rate???  THey say that interest is either $2 per day or $1 per day depends on who we're talking to.

This could go on for years and we would never even touch the principle - this is why DH doesnt want to even start paying anything!!! Whats the point - he'll just paying for the rest of his life.

With his record as a discharged bankrupt, DH cant even think about asking any bank for any sort of loan - so again he says why bother?

He's already mad that sending the letter just reset the clock to zero!!!

Fortunately noone is taking our tax returns & GST away from us...yet.  We did lose the GST for the 12 months he was undischarged but they are now coming to us. And if we loose the GST to these stupid CA,  he will be very upset

Cesca

 

Cesca,

You are quite right, a payment of $20.00 wll not cover the interest. Keep in mind that it is the gesture of goodwill and represents your willingness to settle the debt; more importantly, it establishes a payment history that will make it difficult for the CA to either refer your outstanding debt back to the lender OR to initiate civil proceedings against you (the latter will occur if the CA has a blanket permission from the lender to initiate civil proceedings against you.)

The modest payments to the CA are a temporary solution and are not meant to go on forever. The assumption is that while you are making these payments, you are also looking for avenues in which you can settle or pay the outstansding debts in full. For me, it took two years of modest payments until I was able to secure a consolidation loan to settle my outstanding student debts with the CA's.

As I said in my previous post, it is best to make nice with the CA. To ignore the CA in the hope that they will go away is childlike thinking. These "people" are maniacially focussed on one goal: debt recovery and they will do whatver is necessary to recover that debt. If this means constant phone calls, beratement and empty threats, so be it.

You mentioned that :

This could go on for years and we would never even touch the principle - this is why DH doesnt want to even start paying anything!!! Whats the point - he'll just paying for the rest of his life.

and

With his record as a discharged bankrupt, DH cant even think about asking any bank for any sort of loan - so again he says why bother?

Cesca: it sounds alot like DH does not want to deal with this problem. His lackadaisical attitude toward debt repayment is not going to help his cause. It is not enough to say "why bother" and "what is the use?" Agreed, student debt sucks; more precisely, recovery of student debt by a CA, sucks more. But here is the scoop: the CA's are not going to go away anytime soon and to ignore that monster invites far worse. My advice to you is make the modest payments with the CA and explore avenues of borrowing money to get these roaches off your back.

Lastly, you mentioned that you did not come to Canada to be in poverty. As a citizen, I take offense to this remark. If you dont like the way things are run, you are more than welcome to leave. Canada is not a charitable organization but what we do offer is unfettered access to social and economic opportunites likely not found in your country of origin. Of course the decision to leave or stay is yours; however, while you are in our country and while you are a landed immigrant, I would ask you to remember who your host is!