I have been reading some of the postings on this very informative site and I see people saying that Consumer Proposals are a waste of time.  They may well be, but what other options are there? Bankruptcy? Don’t like that one much either. 

I also see postings about settlements – is there a way for settlement without a Proposal?

I have also taken the seemingly consensual advice and talked to Mr. Leblanc but unfortunately I didn’t get the rapturous result others have.  He suggested a settlement with CSL is almost impossible unless I suffer some serious accident and then some.  He did offer to help me (and he seems very genuine and efficient) with some wellness or debt counseling but I don’t think I need that – I just need to do something about a student loan that I first contracted for in 1979!  (I don’t have any other debts – I don’t have much income – UI – but I don’t spend much). Perhaps, I should mention I have tried to talk with people at CSL collection department for years but they don’t seem to care if they resolve anything.  I have never been called by any private CA or threatened with any trouble but I need to get this monkey off my back. So again, is there a way for settlement without a Proposal?

Thanks for reading.

you can always offer to settle the entire debt for a lump sum payment, however, it doesnt sound like you have much disposable income to float this idea.  also, CSL's are notoriously difficult to settle as the government is content to take your income tax and gst until you are in a nursing home.

if you have spoken to john and he says the settlement is virtually impossible, he is probably correct.  john has lots of experience dealing with these issues and would not give you bad advice.

i've never heard of one dragging on this long with no CA involvement though.  anyone got any ideas ??

 Faith,

 You had come to me with many questions. I answered them. The truth is what you were told and I apologize if this is not what you wanted to hear.

 If you are looking to settle a guaranteed Canada student loan, you are going to have to propose it. There is no way around this. You just can't offer the government a sum of money and demand that they accept it just because you don't want to pay any more than what you feel is fair.

 As for consumer proposals and bankruptcy... they are all one in the same. Consumer proposals are a program that is governed by the bankruptcy and insolvency act.

 Lastly, you are not a client of mine, therefore, i do not give advice. I answered your questions, that's all.

 Johnny  

 Laurel,

 Unless the bankruptcy and insolvency act has changed... then a consumer proposal is JUST another form of bankruptcy. If they are not the same, then why are they governed by the same act ... and administered ONLY by a bankruptcy administrator?

 A consumer proposal is an alternative to bankruptcy. Well, Pepsi is an alternative to Coca Cola. They are both colas - just a different brand. They are both dark, sweet to the taste, and have this ability to capture so many people.

 A consumer proposal is certainly that, Laurel - an offer to pay a debt. Is it bankruptcy? Yes? No? Is a consumer proposal a program or service that is administered ONLY under the Bankruptcy and Insolvency Act?

 Here, let's spell it out....

  http://laws.justice.gc.ca/en/B-3/C.R.C.-c.368/20594.html#rid-20791 - http://laws.justice.gc.ca/en/B-3/C.R.C.-c.368/20594.html#rid -20791

 Also ...

  http://laws.justice.gc.ca/en/B-3/C.R.C.-c.368/index.html - http://laws.justice.gc.ca/en/B-3/C.R.C.-c.368/index.html

 Lastly, I do agree with you that some people benefit from bankruptcy, of course. Those whoa re legitimately bankrupt will benefit. Those who go bankrupt because of bad advice, strong sales pitching from the bankruptcy sector, etc... are the ones who suffer even more.

 Johnny  

F&H,

Just a quick question (for clarification)....you initially took out this CSL in 1979? If so, you are dealing solely with the government (no private lending institution)? If this is the case, there's a plus and a minus to the situation. Firstly, the feds are generally more reluctant to litigate than a private institution. In most cases, you can make arrangements for partial monthly payments without being harrassed. This is the plus.

The minus is that the feds are far more reluctant to settle the debt for less than the amount owed than private lending institutions. The other two concerns I would have are these (hoping others may have answers):

Can you declare bankruptcy on a CSL loan from 1979? Don't know how the changes in bankruptcy legislation would affect a loan that old so that may not be an option.

Have you formally acknowledged this loan? Is a loan this old even still active? The reason that the CSL may not be cooperating is that they may not even have any information on a loan that old.

Johnny,   please don't take offense – I can see from the postings here that you are of great help to your clients and a great resource to all on this site.  I was just hoping to find a greater fit between the services The Canadian Financial Wellness Group (CFW) offers and what I believe it is I needed.  Please forgive my cynicism: I spent about 3 years trying to solve this using a debtor service here in Toronto and they really had no idea what to do – they told me they had all this experience but it became very quickly and very clearly I may have been there first case.  They certainly lacked the experience and knowledge you have – not to mention the integrity.

I don’t think I can demand anything of CSL given that I am in default and it is my own fault but I am talking more than just fairness – I once offered all that I could (most of the money coming from an aunt).  If it were only fairness! I borrowed $8500 and they have already received $11,000 in tax returns over the years but still want $21,000 more.

Consumer Proposals are the same in that you need a third party(trustee) and your are under their control for a significant period of time and your credit is screwed for a significant period of time – not that it isn’t already.

Pigeon: yes just the gov.  and as Momof 2 rightly says even though they have a group called collections they don’t seem to care if they ever collect (more cynicism: they are just waiting until they collect their pension – my file is so old I have gone through 4 contacts at CSL, two retired and one was promoted).  Partial monthly payments would have been a good idea but currently as we are going to have trouble paying next month’s rent it is not an option. 

Thanks to all – I am so pleased to have stumbled on this site for so long I thought I was alone. This site truly gives one faith and hope.

john,

A wolf in sheeps clothing is still just wolf...Bankruptcy,OPD and consumer proposal are treated as equals in the private lending sector..and if you look carefully all three are regulated by the BIA act..same as bankruptcy..... just prettier packaging.

troy

faith

another reason they dont care if they settle the account - look at all the interest they have added on over the last 25 years.  you've already paid almost 20K, and say they still want another 21K.  yikes.  can i ask what the original amount borrowed was ?  probably under the 19K you have already given them...

have you pursued debt forgiveness at all ?  as this matter has been ongoing for 25 years, maybe you can appeal somehow to have the interest suspended or some compassionate relief issued as you are on unemployment.  i honestly dont know enough about your situation to offer any other suggestions. 

i DO hope they have been issuing you statements of interest paid for your income tax over the years as you can claim 17% of the interest paid on your taxes.

sadly, if your loan has been in the system for 25 years, it doesn't give much hope for system reform, now does it.

So the question is this......if the student loan (even one this old) survives the bankruptcy and or proposal, and if this is faith's only debt, then is this a viable option?

I could be missing something, but it kinda sounds like the only two options are 1. to settle the loan for the full amount owed or 2. to set up partial payments. ???

F&H,

You must have been making payments (acknowledged) against your csl loan in last 26yrs for the loan not to be stats barred, am I correct?.

you said,

I was just hoping to find a greater fit between the services The Canadian Financial Wellness Group (CFW) offers and what I believe it is I needed.

What is it you need?.....It sounds like John has offered exactly what you need.

you said

I just want to get this monkey of my back 

He said that he could help you

It would sound like to me and this is only my .02 cents,

you have tried other "credit" counselling with no effective results, you have posted and asked for settlement advice with no positive results.you have asked John for his advice still no results that fit the bill..... And the search continues

I can not understand what it is you are looking for then ! Are you looking to find a way out of 26 year old debt with out paying against it after you have acknowledged it over the course of time? A contract is binding and you have called it a contract, correct. you have acknowledge it by paying on it. so please tell us what it is you are looking for 

To me it sounds like you are searching for a means out of your contract with out paying... and for that I am sorry I do not believe you will find that information anywhere, including on this site.

troy

ps. csl will let your loan sit in collections for ever and a day the longer it sits the more interest it will collect and the greater the balance you will be trying to settle or aviod.

administrator wrote: When I examined a proposal, I learned that if the creditors rejected it, then its an automatic bankruptcy. When you do a proposal you risk being bankrupted.

Are you SERIOUS, Mark? Holy ka-rolly...I had no idea and I read every brochure given to me. I just thought that if the proposal wasn't accepted, you were just thrown back to the wolves again.

And that, people, is why you shouldn't assume these business know it all. Or tell it all.

administrator wrote: Personally, I think we can resolve this issue by saying that proposals and bankruptcies are just two different products, each with the same outcome. a) both are covered under the Bankruptcy and Insolvency Act. b) They are different approaches, but you still have to give up credit cards etc... c) student loans survive the proposal and bankrupty d) destroyed credit rating for a number of years. Mark

Exactly. Proposals for student loans are a bandaid only...and one that can stick to your hair and hurt when it's removed.

Ouch!

Poly

OK, here is my take on bankruptcy and proposals. now granted this pertains to consumer credit more so than csl's.

going Bankrupt:

you walk in the door to your local trustee. you pay your $1500 and 9 mos later your life can begin again. debt free clean and simple no brain damge no hassles. 3mos into bk you can begin re establishing credit. one year post bk credit can begin to be repaired (high interest loans). 2yrs post bk qualify for mortgages at prime (ish) 3yrs into bk unsecured credit cards, prime rate smooth sailing 3 yrs to go and no record of bk.

the feel good route= porposals

trustee negotiates your proposal, you at that time get attached at the hip like a marriage to your new best friend your trustee(3-4 yrs),you begin to make payments thru your trustee to your creditors during your time in porposal you cannot re-establish credit... why you might ask.. well because if you can afford the luxury of re-establishing credit you can afford to escalate your payment to your creditors. so now that you have been in credit limbo for 3-4 and you have graduated from your proposal.. you can begin re-establishing your credit career or life. well its going to require the exact same three steps as the bankruptcy only instead of running in conjuction with your bankruptcy it begins after completion... the good news is you have paid your creditor a portion of what you owe the bad news well its going to take you the full 6 years of your proposal to be re-established... but hey you should feel good about paying back a portion of your debt to the people who wouldnt help you out of situation they help you get into...

just my opinion

Troy

I should have called the above post,

the 3 year route vs. the whole 6 years

troy

I also would like to add to the above post,

I personally have had far far far to many clients come to see regarding loans that are in proposal... and everyone starts by saying

" but my trustee told me that if I/we went bankrupt it would be a permanent black mark against my credit... thats why we choose the proposal... he/she promised us that it was a much better route to bankruptcy and we would salvage our credit by going this route"

My only reply I have is " phone your trustee make an appointment to see them get permission in writing saying that you have been paying your proposal on time and that he/she will authorize you to obtain more credit"

Well to be blunt Im still waiting for the letters.

Troy

Im guessing that proposals are an easier sell to the potential client,

and the truste probably makes more money of them due to the long term involvment

Im going to stop my rant now about all this but I have honestly never heard anything positive resulting from proposals...and 90% the time the person,in some form or another has been lied to regarding the differences.

Troy

No, I agree...I know people who declared bankruptcy (one couple slipped in their student loans right before the ten year rule went into effect)...and had all the trappings of yuppiedom only a couple of years later...

So what IS the advantage, beyond that warm and fuzzy feeling you will get from being a good boy or girl and making payments on your debts?

Poly

Poly,

honestly I have yet to see one advantage.

but think of it this way

you as a credit criminal have to explain to your best friend,mom/dad whoever that you are filling for bankruptcy... what a horrible feeling... you just told your best friend that you are broke you cant pay your bills... essentially you are a failure ( ok a little exagerated)

or the alternative

hey geuss what i was struggeling with some debt but I found this great credit cousellor who has helped me get my creditors payed back in only X amount of years, and it wont hurt my credit as bad as bankruptcy would... doesnt that sound like you have done the right thing... saved face.

now picture this: you are the trustee and you have to pitch one or the other option to a potential client, some small talk goes by you feel the client out.. assess which route would be the easiest sell.. the client is going to feel either 1-3 ways 1. they are embarassed 2. they dont care and dont want to pay. 3. sitting on the fence

1.so on this particular situation they are mad you pitch absoulute bankruptcy an easy days commission.

2. the client is embarassed you pitch the proposal.. great now you have long term commission. the client goes away happy feeling like they have done the right thing ,and you get the oppourtunity to earn long term rewards ( off every single payment or the total amount of repaymet )

3. the best kind I would think... this client is the one you can make or break in your direction of choice... quick turn around in pay or long term client

again just my opinions..

Troy

poly,

I by no means was refering to you or anyone else in my above post.

I was only trying to explain in a manor that you would have to visualize each scenario

I hope i never offended you

Troy

No no...I wasn't at all...No worries.

Here's how the consumer proposal was sold to me:

You can't declare bankruptcy until ten years after you graduate. But, if your creditors approve, you can have a consumer proposal so that you are making payments and keeping the collection agencies from eating your young for four years. Then you apply for another one and so one until your ten years are up and then you can declare bankruptcy!

Beauty, eh? Technically declaring bankruptcy three times in ten years!!! They must have REALLY thought of me as a loser -- "Ah, once her ten years are up, she'll be 50 and after six years, she'll be 56 and too old to reestablish a credit rating anyways..."

*shudder*

Poly

I rest my case,

3 bankruptcy in 10 years, that trustee should lose their license

Bankruptcy/creditor protection what ever you call it. is essential and serves it purpose. Allowing grey areas and trustee's like that destroys all its credability.

troy

if creditors would simply work with debtors who are having financial difficulties rather than turn their backs and simply hand your file over to some CA, we wouldn't need baknruptcy or proposals or trustees and they would all be out of work....

a simple solution that will never see the light of day, unfortunately.

 Cargo wrote:

 "Well to be blunt Im still waiting for the letters." ...

 This is just too funny.

maybe its because my mom worked in a bank for so long but the level of service, or lack thereof, that i see today makes me nauseous.

when she was in banking we lived in sudbury, and INCO was on strike, then the beer store workers were locked out, etc etc.  none of them lost their homes, the bank was always very accomodating and compassionate, even floating loans to those who needed it with repayment to start six months down the road.

now, you're one week late with a payment and they are all over you.  makes me want to move to an island that doesn't have money or other people.  guess i'm feeling anti money lately, it IS the root of all evil, after all.

How true...I worked at the CIBC as a teller, a customer service rep, in the personal chequing department and in dealer plan car loans between 81 and 92 and saw all the changes happening before my eyes...

For one, service was replaced by selling products. So "helping customers" became a euphemism for "selling stuff." The personal chequing department disappeared; where I used to manually transfer money to cover overdrafts or call the customer to inform them of one, all that was moved to a central processor in Winnipeg. The seniors were so upset...We had a student loan processor too...that disappeared to Toronto so no one could get personal service anymore.

Oh, and dealer plan disappeared too.

What is the advantage to the bank? Less salaried employees, more commission-based employees, more money. Which is all that counts, you know...

Poly

poly,

you said,

"Oh, and dealer plan disappeared too."

when cibc folded the dealer plan it was a sad day, not only did it leave a lot of customers hanging in dark, but it also left  the dealers to deal with the mess. I still hear customers complain about the mis managment of thier loans.

funny thing about RBC, when I left Kelowna for Calgary I was a loyal RBC customer I had dealt with the same 2-3 tellers from childhood. After I had settled in Calgary I tried to transfer my accounts and RBC made a mess that some how they had lost an entire saving account in the transfer, they merged my 7yrs son's account with my chequeing account, When I inquired as to why? they told me his credit score did not qualify to open a new account... so much for the transfer. In the 2 weeks that it took to get everything corrected I had spoke with 3 different branch managers in the same bank, I do not believe that I ever spoke with the same teller twice. I could not believe the level of incompetence(?)I asked why they do not keep the same managers and tellers at a branch for customer comfort. They told me it was for my protection, It prevents employees from getting comfortable with thier surroundings, and reduces the risk of internal branch theft.

 my question to them was can you explain to me how RBC losing my sons money and not replacing it or teller stealing is any different... they told me if I was unsatisfied with the service at RBC that I was free to go elsewhere.

Now I deal elsewhere great service  same tellers and manager, they even sent my son a Christmas card...lol

Just to let you know my sons money was moved from his savings acct to a dorment checking account of mine and never actually transfered..

troy

I know me to mom, but I have a feeling I would not sleep well on lumpy nickles,pennies and dimes.

I love kelowna, to bad its a great place to starve, how long did you live there? I lived there 30 some yrs seen lots of changes, I remember when Orchard Park mall was actually an orchard...lol

Troy

Not long..moved to Alberta as a baby (with my family of course--mommy and daddy et al.)  Have relatives there--they've been there forever!!  Have been back to visit, that's all!

LOL--30 years of starving--hmmmm...something kept you there.....

actually, I never really starved you could always go and raid an orchard..lol fresh cherries sun sand and beach beautiful.

on a side not today in calgary. -1 million snow blizzard white in some areas, Deerfoot/ #2hwy is closed, wind that could tip over a sail boat.

im terrified to leave my office and go home...

troy

Calgary is bad, but nothing compares to Lethbridge for wind... it never ever stops ..ever... the grass at an angle the tree grow at an angle... all you here is wind.

If it wasnt for the Chinooks in Calgary i would go back to starving in kelowna..-30 and 30 mile an hour winds... too much for this wimp!

warm thoughts now people

fresh cherries ,sun, sand .... ahh thats better 

man my grammer and spelling sucks... its because my hands are cold..lol

what i was trying to say was everything grows at an angle from the wind..lol

 if i used the words to discribe that temperature, well my mom would disown me,

(where I live) it was -51 with the windchill.

Hunter stay warm and what ever you do dont go outside..

Troy

Here's a live webcam view from the University of Regina. Can you feel the cold?

http://webcam2.is.uregina.ca/view/view.shtml - http://webcam2.is.uregina.ca/view/view.shtml

Well unfortunately I am in a proposal.  I had a CSL which I had paid in full but I was struggling trying to pay my Ont SL and my Canada SL.

As I said I paid my Canada SL and had to do a proposal for my Ontario student Loan because thats all the debt I had.  I am down to under 4,000 and still paying but as a single parent with an ex who is self employed and has not paid child support in 7 years I did not have a choice.  I work full time but as I said a single parent,daycare etc..

I have thought about bankrupting but I am kind of obligated now under the proposal and I was told by 3 different trustee's that because the student loan was my only debt it was not an option or a reasonable one

ANY HELP????