New Student Loan Bankruptcy Canada Rules are HERE!
In an absolutely stunning and unprecedented development, on July 7, 2008 the Minister of Labour signed an Order in Council changing the automatic discharge period for student loans in a bankruptcy from ten years to seven years.
This is a stunning turn of events, since the Office of the Superintendent of Bankruptcy is still working on drafting the regulations to the new rules. In other words, we don’t know how the new rules will work, but they are here!
Even more amazing is that in most cases when new laws are passed, all of the law is brought into force at the same time. Not today. Only two sections of the law were changed. First, the new RRSP bankruptcy rule, which allows a bankrupt person to keep their RRSP if they go bankrupt, except for contributions made in the preceding year. And, of course, the new student loan rule.
That’s it. All of the other new bankruptcy rules are still in limbo.
What does this mean to you?
If you are in financial trouble and are considering bankruptcy, and if you have been out of school for over seven years, you should immediately contact a licensed bankruptcy trustee to arrange a free initial consultation to determine if bankruptcy truly is the solution for you. There are other options, which is why a consultation is necessary.
We are awaiting publications of the exact rules; as they become available, I will post information on this blog.
