Archived Urgent Help Needed Posts - Does CRA collect on Ontario Gvmt Student Loans?

Does CRA collect on Ontario Gvmt Student Loans?

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Topic: Does CRA collect on Ontario Gvmt Student Loans?

Posted By: Scooter
Subject: Does CRA collect on Ontario Gvmt Student Loans?
Date Posted: 07/August/2013 at 1:03pm

Hi all,
I was expecting a tax refund yesterday, however when I called to find out what was going on with it, they told me there was a lien on my taxes for $3,150. I don't understand this, and I paid my CIBC student loans off in full in 2006 to a collection agency that did report my debt paid to the credit reporters. I know for sure that was my federal loan, and I also paid off a smaller Ontario student loan. I had no other loans outstanding to my knowledge and nothing has shown up on my credit report and no one has contacted me since. CRA said it was possible that they were never informed that the debt was paid, but they had no choice but to remit the money to whoever it was that liened it. Funny enough, they gave me a number to call which turned out to be a collection agency and they told me the debt was from 2006...which is when I paid it off. My question is, would the CRA collect on an Ontario Student Loan debt that I wasn't informed of that was owing? Because from what I understand from reading other threads here, they will only collect on a federal loan which I know for sure was paid off. Any info would be appreciated, as I can't find much else online. Thanks in advance!

Replies:

Posted By: Scooter
Date Posted: 08/August/2013 at 5:32pm

If someone does manage to read this and is able to shed some light here, I would also like to add that my loans both federal and provincial were from 1995-1996 or so. They went into default I believe in 1997/98 by CIBC who reported my loans were in default when in fact they were not, which I know happened to many people. Long story short after making years of payments and co-operating with the collection agencies, I finally paid the last of what I knew was owed which was my federal loan, in one large lump sum in 2006. My loans were not from 2006 and I have had no knowledge of any other outstanding student debts. I incurred student loans for one year only and did not have multiple loans for different years at different financial institutions for different amounts. Now, the EOS NCN collection agency apparently has placed the lien according to the CRA, and only they can remove it. From what I've been reading here and online, the collection agency wouldn't be allowed place a lien, only the federal government would. I kept the documentation that I paid it (somewhere in my files) including the letter and credit report showing my balance as $0, paid in full. If it turns out it is my federal loan, and they've collected on it twice, will I get my tax money back? Can a private collection agency lien my taxes? Doesn't sound right to me. EOS NCN says the loan was from 2006, that they just "got the file" in 2012, that someone else had the file before them and they had contacted me at an address I haven't had since 2010. Of course he tried to blame me for that, but I had no reason to update my address in regards to something I thought was paid off. This is making my head spin. I was so mad about finding out I wasn't getting the tax refund I thought I was which I was relying on to pay rent this month and buy food, I didn't "hear" everything the jackass (which he was) at EOS NCN was saying about the loan, but I know I paid it off. I can't believe that almost 20 years later this is still haunting me and I thought I was done with it in 2006. I did not acknowledge any debt to EOS NCN, and CRA couldn't tell me much and said I needed to call EOS NCN for information. I am trying to find out who their client (CIBC or Federal Gvmt) and want to know...where is best to call to find out who exactly is claiming I owe this money and if there is more owing? I don't want to call EOS NCN back if I don't need to. I also have no written information on any debt they are trying to collect, and isn't it up to them anyways to ensure they are sending paperwork to the correct address? I am also reading that Ontario loans have no stats barred limitations, but read somewhere else on this forum that is not entirely true. The other strange thing is, back in 2009-2010 (not sure exactly when now) I got a refund cheque from the Government for some kind of overpayment or interest credit on something to do with my student loan. It was very small- $15 or something. But if I owed them money since 2006 or prior, why would I get a refund cheque of any kind?

I am asking for some direction here as I am currently out of the country, I have no access to any of my loan paperwork at the moment- only my laptop and Google. I also do not have a job right now and haven't since February, haven't worked full time since 2010 when I was laid off, and was counting on that refund to survive and now it's gone. If there was an error and that money was for my federal loan that was paid 7+ years ago, I will do everything I can to get it back.

Any direction is appreciated. :)

Posted By: SolveStudentDebt
Date Posted: 09/August/2013 at 6:21am

EOS would be handling you Ontario guaranteed loan (OSAP). If you paid your federal and want closure, simply contat the non-tax collection office of CRA in Belleville Ontario and ask them for a current balance outstanding. It they say ther eis nothing then you are clear with them.

As for limitation issues pertaining to OSAP, well the system says one thing, the law communites say another thing. The truth is that limitations do apply in some instances whereas the student loan was opened and in recovery before the date the new legislation came into force. Loans taken out after the date the ammendment was made to the Ontario limitation act are not subject to any limitations.

Example: If you took out the loan in 1998 and haven't made any payment or acknowledgment of any type (and nolegal action taken) that constitutes as that for 6 years then the loan should be barred.

In my opinion, and in the opinions of several law groups that are part of my circle, the limitation law in Ontario is not retroactive. I have also seen cases of mine whereas OSAP limitation issues came into play. Each case is unique of course and something like this can only be determined on a case by case basis.

It either is - or isn't.

-------------
Solve Student Debt specializes in solutions for students and graduates in student loan default, and those at risk of defaulting.

http://www.solvestudentdebt.com" rel="nofollow - solvestudentdebt.com

Posted By: Scooter
Date Posted: 09/August/2013 at 9:31am

Thank you, Johnny for your response. So it turns out the lien on my taxes was for my Ontario student loan, which I also thought was paid but apparently I only paid a portion of it, it seems. This is boggling to me, as I paid what was told I owed at the time which was much prior to 2006 and nothing showed on my credit report and when it did was showed as paid as agreed. According to EOS (which were much nicer to me today) my loan went into default on November 4, 2006 which I do not understand considering it was taken out in 1995 and went into default in 97/98 therefore it would fall under the old legislation, no? I was never contacted by any government office or collection agency for any amount outstanding either Federal or Ontario, and the address they had on file was valid until 2010 and never got any correspondence from anyone from 2006 onwards. From what I understood from reading on this forum, the CRA does not collect for the Ontario government. How is it that they were able to lien my taxes? Apparently, I still owe the interest on the amount, which is currently around $1,500. Is there any way I can get that reduced considering I had no knowledge of this debt thinking it was paid off years ago which clearly it wasn't? I haven't acknowledged any debt to anyone to date on this. Can I agree to make payments so they don't take any more taxes from me? Not sure where to proceed from here or if this is something you think your services can help me with Johnny. Any suggestions would be helpful. Thanks!

Posted By: SolveStudentDebt
Date Posted: 11/August/2013 at 6:04am

CRA does not actually collect for the province of Ontario. The provinces are able to collect money by way of set-off, which is taking income tax returns. CRA is just doign what they are supposed to by handing money that is due back to you over to the province. It is a Canada student loans program initiative, of which HRSDC is behind.

Posted By: Scooter
Date Posted: 11/August/2013 at 6:23am

So stats barred or not, they can still take the money? I am so mad that I was not made aware of this earlier. It seems I have now paid off the principal amount and just interest is owed. Can I not negotiate with them on that amount to lower it and will they take payments so they don't take my tax refunds anymore? I'm just trying to figure out what the best next step is and if I should bother to deal with the collection agency because I know that acknowledgement of the debt will reactivate it. Thanks again Johnny for your responses!

Posted By: SolveStudentDebt
Date Posted: 11/August/2013 at 3:00pm

If you owe it, and it is in default, yes they can. The only way to get the lien lifted is to ask them and each case is very unique. Traditionally, they do not remove them unless the debt is paid though. MAking an offer to settle is one thing, but you have to get them to agree to lift it and have it in writing.