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Federal Student Loan

I have gone bankrupt over my provincial student loan but my federal student loan had not been 10years old yet. I have been contacted by a collection agency. Can they garnishee my wages?

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One Response to “Federal Student Loan”

A licensed trustee said...

I think you should check with your trustee – you can’t go bankrupt on your provincial debt without also filing on your federal debt. The same rules apply to both sets of loans – if you haven’t been out of school for at least 10 years when you file bankruptcy then your student debt survives the process.

If your student loans have been referred to a collection agency then they only way they may garnishee you wages is to to take you to Court and have a judge issue an Order to that affect. A collection agency cannot simply decide to garnishee you wages.

I’m serious about the provincial vs federal student loan thing – call your trustee and make sure you are correct in your understanding of your situation.