Student loans

Student loan debt can be dealt with either through a consumer proposal or in bankruptcy.

According to The Bankruptcy and Insolvency Act, student loans are abolished if you were a full-time student seven years prior to bankruptcy or a consumer proposal.

The seven year rule is important because if this is miscalculated the student loans will not be included in any bankruptcy application.

If you declare bankruptcy seven or more years after the date on which you ceased to be a student, your student loan debts can be eligible for discharge along with your other debts.

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If you graduated less than seven years prior to filing for bankruptcy, you can still make a special application to have the student loan discharged by your bankruptcy.

If it has been at least five years since you were a student, you can apply for a discharge of your student loan through a hardship provision.

To apply for the hardship provision, you must convince the court that you have experienced a continued financial hardship that stops you from repaying the loans.

When considering the hardship provision, the court will look at how you spent the student loan money, if you completed your education, and what efforts you have made to repay the loan.

To learn more about how to free yourself from student loans when you’re undergoing a bankruptcy or a consumer proposal, call us today.