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I`m paying back student loans but colection agency says its not enough

Hi there
I`m paying back my canada student loan to a collection agency called Alliance one. I`m trying to be cooperative to the agent thats handling my account. I`ve told him that I can only pay $200 for the first month and will pay a little more when my financial sitiuation is better. He disagreed and expects me to pay $600 to $700, which is outrageous. I won`t be able to survive on my paychecks if 30% is going to one payment. I was wondering if collection agencies could take me to court or garnish my wage if I don`t pay the amount they requested? If I do go to court can they charge me for legal fees too?
Thank you for your reply!

Posted from: British Columbia

One Response to “I`m paying back student loans but colection agency says its not enough”

Barton Goth – Goth & Company Inc. – Bankruptcy Trustees said...

You are correct, all creditors can take you to court and then garish your wages if you do not meet the required monthly payments. The only way to prevent them from being able to do so is if you file a bankruptcy or a proposal under the Bankruptcy and Insolvency Act. Although there are special rules surrounding student loans and these programs (i.e. student loans are not cleared unless you have been out of school for greater than 7 years).