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Question: I currently live in Ontario having moved here 6 years ago from Nova Scotia. I have student loans from my time in Nova Scotia. I was last in school in the year 2000 (I borrowed approx $28,000). My life sort of fell apart for a while due to divorce and other factors and I never graduated, but I have been rebuilding my life for the last 6 years. I am now finally making a decent income (around $42,000) and remarried. My wife has a perfect credit rating and wants to buy a home. Im fairly certain my past is going to cause problems with this.I dont want to declare bankruptcy in Ontario but I also dont want to have my lifestyle go back to the poverty level I was in before. I havent heard from CSL (Canada Student Loans) at all until two years ago when they started keeping my income tax refund. that has been the extent of it so far though. How should I proceed? I would like to look at owning our own home within the next year or so but I also want to be realistic.
any help or advice would be appreciated
Answer: Personal bankruptcy in Ontario may not be the correct option for you.
First, under current rules (early 2008), student loans are not automatically discharged in bankruptcy until you have been out of school for ten years. Therefore, if you went bankrupt today, your student loans would not be automatically discharged. New rules have been proposed by the federal government, and we expect them to come into force later in 2008 or early in 2009. The new rules will reduce the waiting period to seven years, so if you plan to go bankrupt, it may be wise to wait until the new rules come into force.
Up to the minute information on student loans and bankruptcy can be found on the Student Loans Bankruptcy Canada web site. On that site, and on this site, you can sign up for a free e-mail alert service that will alert you to when the new rules come into force.
Second, there are a number of negative implications to bankruptcy. The cost of bankruptcy increases with your family income, so it's possible that a consumer proposal may be a better option. Without knowing your full circumstances it is impossible to give you a more precise answer.
A licensed Ontario bankruptcy trustee can provide you with more recommendations on your specific situation.
any help or advice would be appreciated
Answer: Personal bankruptcy in Ontario may not be the correct option for you.
First, under current rules (early 2008), student loans are not automatically discharged in bankruptcy until you have been out of school for ten years. Therefore, if you went bankrupt today, your student loans would not be automatically discharged. New rules have been proposed by the federal government, and we expect them to come into force later in 2008 or early in 2009. The new rules will reduce the waiting period to seven years, so if you plan to go bankrupt, it may be wise to wait until the new rules come into force.
Up to the minute information on student loans and bankruptcy can be found on the Student Loans Bankruptcy Canada web site. On that site, and on this site, you can sign up for a free e-mail alert service that will alert you to when the new rules come into force.
Second, there are a number of negative implications to bankruptcy. The cost of bankruptcy increases with your family income, so it's possible that a consumer proposal may be a better option. Without knowing your full circumstances it is impossible to give you a more precise answer.
A licensed Ontario bankruptcy trustee can provide you with more recommendations on your specific situation.
Labels: bankruptcy Ontario, student loans
posted by Questions @ 6:32 AM
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