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Can a collection be put back on your credit report for the same debt?

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Dear Jeff,

I have an outstanding Ontario Student Loans (OSAP) debt from prior to the year 2000. Because of this, there was a collection on my credit bureau report causing my credit rating to be poor. This collection on my credit report dropped off last year due to it expiring and my credit rating improved rapidly. Yesterday, it appears, a new collection was put on my credit report for this same debt. Is this legal? Can a collection be put back on your credit report for the same debt? I have never acknowledged this debt and have made no voluntary payments against it.

However, my income tax refunds have been taken each year towards the debt. Does this count as an acknowledgement of the debt allowing a collection to be re-added to my credit bureau report? Your expertise would be very much appreciated on this matter as I have not been able to get a clear answer from my own research attempts. Thank you!


Toronto, ON

Dear R.R.,

Thank you for this question. I will try to answer to the best of my knowledge and hopefully, we can give answers to others.

Why is my debt still in collection?

OSAP debt (provincial and federal) are not subject to a limitation period for collection agency action. This means that this debt doesn’t expire, and it will stay in your credit report. So, when you default on a federal student loan, the government stops helping and starts to pursue collection tactics. The CRA will continue all possible collection actions until your OSAP loan is paid in full. However, collection efforts might be different depending on whether the loan is federal or provincial. It is possible that the collection fell off your report for a little bit because it got transferred to another agency for collection.

Acknowledgement of Debt

If your loan with the NSLSC is unpaid for more than 270 days, it is sent to the respective government or collections which are the Canada Revenue Agency and the Ontario government. They will collect the amount until paid in full. Therefore, according to when a taxpayer stops making voluntary payments toward a federal debt, the CRA can issue a garnishment to the taxpayer’s employer. The CLP (collection limitation period) restarts again for 10 years from the date of the garnishment. Each time the CRA takes an action to collect the tax debt, the CLP is restarted on day one. This means you are acknowledging the debt.

Setting Up a Payment Arrangement

You can consider setting up a payment arrangement with the CRA. This will not only remove your debt from collections, but it could improve your credit score. A payment arrangement will let you make smaller payments until you have paid back the entire debt, including interest. The CRA even provides a monthly net income and expense worksheet, and a calculator to help with your payment arrangement.

If you have any further questions, you can contact the CRA or NSLSC. For the Federal portion please contact 1-866-864-5823 and for the Ontario portion contact 1-800-387-5604.

Jeffrey Schwartz
Executive Director

Jeffrey Schwartz is the Executive Director of Consolidated Credit Services of Canada and Former President of the Credit Association of Greater Toronto (CAGT).

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