How to Pay Off Student Loans in BC

Student Loan Debt in BC

Student debt is a massive problem in many parts of the world, and Canada is no exception, unfortunately.

Here at BankruptcyCanada, we speak to thousands of people burdened by the cost of their past studies.

Further education is no guarantee of high-paid employment, and like with any other debt, student debt can end up hanging around for years.

If you’re wondering how to pay off student loans in BC, this article is designed to point you in the right direction.

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Consumer Proposals and Student Debt in BC

One of the options open to you if you’re struggling to start your career after college, or trying to pay off substantial student debt on minimum wage is a consumer proposal.

That’s a way to stop some of the less-desirable ways creditors collect debt and a method of getting on with your life.

If you’re suffering constant collection calls and notices, or creditors have gotten an attachment on your earnings, the consumer proposal route is worth considering.

One of the ways a consumer proposal can help you move forward is by stopping the collection calls and measures.

As soon as you file for one, interest on existing debt also ceases to accrue.

Sometimes, that’s all the breathing space a person needs for a fresh start.

Although, with a consumer proposal, you’ll likely end up paying less every month toward debt too.

Here’s how it works:


  • You get assessed in terms of your income and outgoings.


  • You agree to pay off a portion of your debt that you can afford.


  • If the majority of your creditors agree to the proposal, it becomes binding.


  • You pay off the portion of debt using fixed payments over an agreed term.


Personal Bankruptcy and Student Debt in BC

Another option for coming to terms with student debt is personal bankruptcy.

Depending on your situation, a consumer proposal might not be deemed a good fit.

When that happens, personal bankruptcy offers many of the same protections as a proposal and gives you a fresh start without debt in much the same way.

Here’s how that works:


  • Most first-time bankruptcies last for nine months, and the cost gets based on your specific financial circumstances.


  • It’s a myth that everyone loses all their assets in bankruptcy.


  • Collection calls and late-payment fees stop when you file.


The Seven Year Rule on Student Debt in Canada

To apply for a consumer proposal or bankruptcy and get released from student debt obligations, you’ll need to have stopped studying at least seven years ago.

However, if it’s been between five and seven years since you studied, you can apply to the court and try to prove hardship – which may result in you getting released from student debt obligations anyway.

If that’s not the case, all is definitely not lost.

Here at BankruptcyCanada, we often meet people struggling with additional debts on top of their student loans.

Some of those debts might have also been acquired during study – like payday loans, credit cards, etc.

However, that’s not always the case.

When a person has many debts, servicing them can take up all their spare financial resources – and that’s when they get behind.

Even if you can’t escape your student loan obligations, the freedom you’ll get from other debts – and their respective late fees and interest charges – can put you back on top of paying down your student debt.

Getting Help With Student Debt in BC

Even if you studied very recently, if you’ve gotten so far behind with debt, it feels like there’s no way out – it’s worth considering your options for getting back on top.

Only a licensed insolvency trustee can file for a consumer proposal or bankruptcy on your behalf – and there’s several in BC.

Contact us today for a no-obligation chat about your circumstances on (877) 879-4770 (24/7).

At BankruptcyCanada, we’ve helped tens of thousands of Canadians with debt.

Gordon Sands

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