what am I in for

I have a Canada student loan of which is comprised of aproximately $55 000 of debt between all the three loans, provincial, Federal before 1999 and New federal loan. I have currently been in default of my loans for almost 8 months. I cannot afford to make the monthly amount of payments as I am a father and my alliegences lie elsewhere than in the palms of our great financial institutions. My gross annual income is approximately $42, 000/year cdn. My first inquiry is now that the loans have gone into collections and they have been notifiying myself everyday, every waking hour of my existsence, my question is, what comes next? What is thier next step in the process? How protected are my earnings and should I fear the likelyhood of having my wages being garnished? Furthermore, I have moneys invested in mutual funds, RSP's and so on. Can the financial institutions put a lean on these investments?

Also, I am aware that my any dollar values for a tax return(s) are automatically siezed, so this to me means that there is a form of private information being disclosed between collector and government. My question is what sort of information are these creditor companies disclosed to? Are they aware of my income? Do they have have access to the particulars of my income tax filling?

Also, a friend in a very similar situation said that his income tax return was not claimed by the banks/criditors until he was well into his 2 year of being in default of his loans. Is there a timeline or period that you have between being in default of your Canada students and provincial loans before this seizure of any returns you may have occur?

Thanks for you time.....

nago, 42 may sound like lots of money but consider deductions (which will net around 28 if you're lucky) , rent, groceries, utilities, upkeep of a vehicle, personal obligations etc THEN consider the cost of raising a family.  THEN consider the monthly payments on 55K of debt. any payments goveiac can make will likely cover the interest only.

g, read up on how to deal with collection agencies.  also research the various government regulations pertaining to your province of residence to see what they are entilted to and how the CA should behave.  surf the forums, there is a wealth of info here.

From what I understand they can not take your investments or I have not read or hear of a case were they have.  I also have very small RRSP that I put money into as well I have a RESP for my kids hoping that someday if they go away to school I can help pay as much as I can for them.  Plus the Government as a push on people getting RRSP so I sure that it benefits them by you having them.

As for a timeline for the income tax holding I don't think there is one, it just take time for all the paperwork to go through the Government office.

troy is right but the resp's are safe regardless

mom,

I just read what you had typed, I was refering to RRSP's. RESP's can also be used as equity against debt if the the savings plan is registered to the debter if the plan is registered to family member and you are the administrator of the plan then it would be safe.

sorry

troy

sorry folks....gotta agree with Poly on this one. Gov, don't mean to be a P%^&k, but building for the future should be secondary to dealing with the past. If you have equity it's kind of hard to turn around and plead poverty. Most of us are still at the stage of "I wonder if I can get a credit card now?".

Have you thought about consolidation? If you have equity you may be able to use that to secure a consolidation loan. This would at least get the CA's off your back. Do you rent or own? There's also the option of rolling your consolidation loan into your mortgage.

Hey 1step,

you said it best! It is perfectly OK to plan and invest in your future. as long as you are meeting all of your current financial obligations.

I guess goveiac it boils down to a question of integrity....