Debt after a Proposal

October 22nd, 2006 by Questions

In 2004 I filed a joint Consumer Proposal. Included in this was my Student Loan. I knew that it had not been 10 years since my studies were completed (June 1995), but was in such a position that I could not fight off my creditors any longer and needed to take action.

My proposal was completed earlier this year. I have now received notice from the Quebec Loans office that since I filed before my loans were 10 years old I am still liable for the balance of almost $30,000 (which more than half of is interest!!!). I cannot afford to pay this.

Is my only option to file bankruptcy. Can I file another proposal. I thought I read somewhere that I could apply to the courts to have it released, I asked my trustee and they said I would have to hire a lawyer and it is not something they get involved in? Can you answer any of my questions? Thanks.

Questions

One Response to “Debt after a Proposal”



, Barton Goth, GCO Inc. Bankruptcy Trustees said:

You are correct, Section 178(1.1) provides that an application can be made to the court after the expiry of 10 years to be cleared from the student loans. To be eligible, this application must be made after the 10 year mark an you must be able to satisfy the court that you have acted in good faith in connection to these student loans and that you will continue to experience financial difficulty to the extent that you won’t be able to pay the liabilities under the loan. This is typically an application you are required as the trustee’s obligations expire on the completion of the proposal. You can make this application on your own, but you may want to consider employing a solicitor to make this application on your behalf, especially if student loans should oppose this application.

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