Student Loans in a Consumer Proposal

I have an outstanding student loan, graduated in June 2002. I am in a position where I must decide between a consumer proposal or bankruptcy. The collection agency tells me that even after a consumer proposal is completed, I will still have to pay the student loan, whereas, the trustee that I have seen has told me that the loan will not be there after the consumer proposal is completed. I have looked on line for this dilemna and have found blogs and comments that are rather vague. What does happen to the student loan once the consumer proposal is complete. Does it survive the consumer proposal or am I done paying at the end of the proposal?

Posted from: Alberta

One Response to “Student Loans in a Consumer Proposal”

Barton Goth – Goth & Company Inc. -Trustee in Bankruptcy said...

The legislation is very clear on this point, if you have been out of school (i.e. not physically attended any classes) within the 7 years immediately prior to filing either a bankruptcy or a consumer proposal, then the student loan is cleared. If you have attended classes within this 7 years then it survives (in both consumer proposal and bankruptcy).