Thank you so much for the information. It is very much appreciated.

It is no secret that the provincial government is extremely "sloppy" at collecting unpaid and overdue fines, debts, taxes and other accounts that are owed to them. The provincial auditor-general's annual report made that "daylite" clear. And, as you are well aware, the provincial government is in deep "doo doo" financially. Therefore, in order to help alleviate this financial "jam", pressure has been placed on all government Ministries and departments to enforce the collection of these outstanding fines, debts, taxes, etc. as quickly as possible. I have talked to several people who are now receiving letters from collection agencies about outstanding and unpaid traffic fines dating back several years as well as people who have not filed Corporate Tax Returns which carries a maximum penalty of $200 a day while in default. And so, the provincial government is "tightening the noose" to bring in outstanding revenue.

The provincial government does NOT report any amounts owing and currently outstanding to the Credit Bureaus. That is why there is nothing showing on your Credit Report regarding this defaulted and outstanding student loan. The only time when a report is made to a Credit Bureau is when the Federal Government places a lien on real property for outstanding and unpaid income taxes. This will happen when the Canada Revenue Agency is experiencing difficulty in collecting income taxes or when the CRA believes that the taxpayer is about to make a quick exit from Canada.

As I mentioned previously, the provincial government is in a bind financially. Therefore, they are attempting to collect from you both by way of a collection agency as well as by withholding your income tax refund and your quarterly GST payment. And, as long as this debt is outstanding, interest will continue to accrue. I would suggest that you contact your local CRA office and get an update on the balance owing on this student loan. And, I would do this every six months so that you know where you stand. I don't believe that Total Credit Recovery will be able to supply you with this information.

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Educating one Consumer at a time

Thanks for the response.

I'm trying to understand why this is just coming to my attention now after all this time and why my credit report shows my rating as No Credit, rather than bad credit.

I'd also like understand how my GSt and Income Tax being garnished affects the final number the collection agency is requesting? If the government has turned it over to collections how are they still collecting on it and how does that impact the final number of my debt?

The provincial portion of your defaulted student loan is provided for by the Ontario Limitations Act, 2002 and more specifically Paragraph 16(1)(k).

16(1) There is no limitation period in respect of

(k) a proceeding to recover money owing in respect of student loans, medical student loans, awards and grants under the "Ministry of Training, Colleges and Universities Act", the "Canada Student Financial Assistance Act" or the "Canada Student Loans Act".

Here is what has happened. When you defaulted on your student loan, the Ontario government guaranteed the repayment of this loan which was originally given by Scotiabank. This guarntee was made pursuant to the "Ministry of Training, Colleges and Universities Act". After the Ontario government paid Scotiabank for the defaulted provincial portion of your student loan, they now become the creditor of the defaulted provincial portion of your student loan. They then assigned this defaulted provincial portion of your student loan to Total Credit Recovery to collect which includes garnishment of bank accounts and salary and wages. The government ( both Federal and Provincial ) do not require a court judgment to garnish bank accounts and salary or wages.

Pursuant to Paragraph 16(1)(k) of the Ontario Limitations Act, 2002, there is NO LIMITATION PERIOD for the collection of this defaulted and unpaid student loan. In fact, any provincial government has the authority to request the Canada Revenue Agency to withhold any income tax refund and GST quarterly tax payment and remit these funds to the provincial government.

As you can see, until this defaulted provincial student loan is repaid, you will be continually chased by collection agencies and perhaps have your income garnished together with your income tax and GST quarterly payment withheld.

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Educating one Consumer at a time

Hi -- when I made the original payment I was under the impression it was for the entirety of the remainder of my student loan from Scotiabank. It seems that it was for the federal portion. I was unaware that they had been split.

The notice Ive received was from Total Credit Recovery stating that I owe 6, 790 dollars on an outstanding loan. When they called me at work they indicated it was for a student loan. Scotia credit services indicated on the phone that the provincial loan was in collections.

Perhaps of relevant note: I had not been receiving my GST cheques as they were being withheld. After I paid the initial sum I did receive one but they appear to have since stopped again.

Thanks for any advice.

Need some answers to my questions

When you made a lump sum payment to Global Collections, what was this for? Was it for the Federal portion of your student loan?

<<< Several months ago I received a notice stating I owed nearly 7 grand. >>> Who sent you this notice and what did it say?

What did the letter that you received from TCR say and was there an amount shown as being unpaid? If so, how much?

If you can answer these questions, I can provide you with some answers.

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Educating one Consumer at a time

Late last year I had a client in the exact same situation. We got to the bottom of it with some harassment of the collection company (reversing roles as it were !) and we got satisfaction that in fact there was no more debt and the matter had in fact ended with the original settlement.

Hi, hoping for some clarity on an issue that has come up. I defaulted on student loans from the mid-90s. Last year after having my taxes and GST returns taken I paid a lump settlement to Global Collections representing Scotiabank. I believed my debts were taken care of. Several months ago I received a notice stating I owed near 7 grand. The notice also stated 'to disregard if this matter has been settled." I assumed it was in reference to the cleared debt and ignored it. In the last couple weeks however, I recieved two phone calls at work and another letter from TCR. I'm being told that I owe for my provincial portion of the student loan. One thing of note is that a recent credit check showed that I had no credit at all. Not bad credit, but none. Which is actually better than I had hoped for.

My questions:

1) What should I do? Is this statute barred and is there a way to find out without acknowledging the debt? Will it affect my credit, or does the no credit score indicate it has been purged?

2) If it is statute barred and been purged how can I stop collections from contacting me and how can I go about repairing my credit?

Any other pertinent information in this type of scenario?

Thanks you so much in advance for any insights.