Hi All,
I have written (at lenght!) about my trials during application for Debt Reduction during Repayment. I have some good news to report, and a discovery many may find interesting. After the final weeks of escalating stress & time run out, I recieved a first debt reduction of $14,300! It took a month and a half to be applied, and the Royal Bank refused to acknowlege the amount applied to my federal loan until forced by CSLP. The process then continues for the year following starting from the date the DRR was applied. I will have the year long audit/application prepared early!
Heres the more interesting part,
Before & after a DRR you must have a revision of terms on all student loans you hold. Before to extend your terms & possibly apply for interest-only payments, after DRR because the principal amounts are lowered. After the DRR you can apply for interest only payments. NSLSC allows for 2 six month periods to cover the whole year, you apply twice. The Royal Bank grants only six month periods as well, but allows granting of a revision only once per year. It took them 3 months to grant the first application, so they would only really grant 3 months!
I had downloaded a copy of the CSLP Policy Manual from this site. It (although dated) states that after someone is granted the first year of DRR that the repayment terms must stay in place for one year. It also states that after the initial reduction from DRR the borrower is entitled to apply for a minimum monthly payment of $25. I also found out that the Policy Manual is underpinned by the Canada Student Financial Assistance Act.
I then contacted NSLC, CSLP, and the Royal Bank Investigations, following up in writing Xpresspost tracked to thier locations. They all found it very interesting but couldn't confirm a thing. Three and a half months later RBC investigations got back to me and confirmed that what I had claimed is true, that terms must be in place for a year, and elegibility for the $25 min. payment. A letter detailing these facts was requested, it then took RBC two tries, the first letter sent was nonsense/unrelated material.
So there you go, I hope this helps people deal with the unworkable (stressful!) situations created by those with vested interests in seeing student loans default. The interest payments for the year previous to my (never mind my wife's!) second application total just under $5000.00. It took them most of the year to admit the truth. My total required payment for the year would have been $900!!!! With 10 of 12 months gone, its only practical to apply for the reduction in minimum payment after a second DRR. Doing so now would only ensure next year is systematically screwed up. RBC investigations agrees!!
When contacting the CSLP & other call centres I refered them to the CSLP Policy Manual (available on this site), Chapter 10, p. 199-200, and the Canada Student Financial Assistance Act. If refused, politely request the refusal in writing. Don't give up until either you have it in writing or the terms of repayment as outlined in the manual are granted. There is good reason these accomodations are in place for those in the DRR process!
Cheers All!
The Secret $25 Minimum Payment when on DRR!!
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