Not To Be Trusted With Knives

The Internet’s leading authority on radicalized geese

By

The National Student Loan Services Centre’s fax number contains “666”

Twitter

So, yeah, I’m still paying off those damn student loans.  But student loans aren’t what I’m bitching about today.  Today I’m bitching about the Royal Bank.

As I’ve mentioned previously, I keep a separate bank account where a portion of my paycheque goes every month, which is used to make my student loan payments.  I have it separate from my main account, which I have at Vancity Credit Union, because I just can’t bear to see $1,000 disappear each and every month – keeping it separate allows me to pretend that I never made that money in the first place!  Anyway, since I started paying off my student loans three years ago, I’ve had this account at the Royal Bank (which holds two of my three student loans – the third is held by the government).  And every month for the past three years I’ve had the same three debits come out of my account with no fees.  But on my last bank statement, I saw there was a $1.50 charge for an “extra” debit, though I didn’t make any more debits than usual. After a bit of back and forth via email with the Royal Bank peeps, I found out that they had changed the rules on the account type I had.  Up until now, my account had no monthly fee and I was entitled to one free debit per month, plus one free debit for every payroll deposit.  I get paid every two weeks, so that gives me two extra free debits – so a total of the three debits I need per month (one for each student loan payment).  Apparently, though their website didn’t say this when I looked at it when the $1.50 charge went through, they’ve removed the free debits for payroll credits, meaning I’m only entitled to one free debit per month, period.  Which, of course, isn’t sufficient.  “But you can get an account that will give you 15 free debits for only $4 per month,” they told me, after I told them I only ever do 3 debits per month.  Since the account I have gives me one free debit and the extra debits cost $1.50, that would only be $3.  And the last time I checked, $4 is more than $3, so, thanks for offering me a worse deal, asshats! Regardless, I’m not willing to pay $3 per month for the “privilege” of paying off my student loans – I still have about five years left to go, so that would be almost $200 in the end. For nothing.  No thanks!  Anyway, I wrote back and restated my needs for this account, asking, “Do you have any accounts that will meet these requirements that won’t have any fees?” (which, of course, is what I have had up until now).  They replied with a form letter that basically told me to look at their website to see what accounts they have.  You know it’s bad when you find yourself replying:

“Hi Sandra,

Thanks for sending me a generic form letter in reply to my question. I’ve already looked at your website and don’t see any options that meet my needs. I’ll just close my account and take my business elsewhere.

Beth”

Did I mention they were asshats?

My next stop was to visit Vancity and see if they had any accounts that would work for me. The person I spoke to there was new and tried really hard to figure out what I was wanting, but she ended up giving me a savings account from which you can’t write cheques or set up preauthorized payments, so that didn’t really work.  A follow up phone call to Vancity (once I discovered that I couldn’t do preauthorized payments) revealed that my only option there that would allow me not to have to pay fees would be  to open a second chequing account and keep a minimum balance of $1,000 in it, in addition to  my main chequing account where I already keep a minimum balance of $1,000.  Not keen to have $2,000 tied up doing nothing, I decided to look elsewhere.  And it seems that my best option is to open a President’s Choice Financial account – they have chequing accounts that will allow me to set up preauthorized payments with no fees and no minimum balance needed.  So that’s my plan.

But it will take a little while, apparently, to get my PC account set up, so in the meantime I faxed the National Student Loans Services Centre and the Royal Bank Student Loans Centre (which, by the way, appears to have nothing to do whatsoever with the Royal Bank… don’t even get me started on THAT rant!) to set up preauthorized payments from my current Vancity chequing account. I figure I can handle one month of my student loan payments coming out of my main account without being too emotionally scarred. I want to make sure I can pay my July 31/Aug 1 student loan payments without using the Royal Bank account – because they don’t deserve even $3 of my money!  And then I’ll use my *one* free debit – to withdraw ALL of my money from that account and close it down!

By

Student Loan Update

So, I usually try to ignore the status of my student loan repayment.  Part of my paycheque goes into a separate bank account (at a separate bank1) and automatic payments are made from that account to my student loans every month.  And I try to not look at that account.  Once in a while I’ll pop into my online banking just to make sure nothing has gone awry, but for the most part, I ignore it.  Basically, I just never see that portion of my income – and so I feel (and spend) like I make less than I do.  It’s much less stressful that way than to see the money show up in – and disappear from – my chequing account.

However, I just got my yearly statement for my student loans (for tax purposes) and so I thought it was a good time to see how much progress I’ve made in paying off these albatrosses around my neck.

My progress:

  • amount I owed when I started paying off my student loans in May 2007: $71,000
  • amount I owe as of March 2009: $56,500

Another interesting thing I noticed was how much this economic downturn/recession/depression has helped me with respect to paying off my loans.  When I started paying them off, the interest rate was around 7.0-8.5% (depending on which of my three loans2 you are talking about).  Now my interest rates are 3.5-5.0%  Since the amount I pay every month stays the same, it means that I’m paying off significantly more principal each month, which will result in me being able to pay off my loans that much quicker3. The government student loan centre’s annual loan statement illustrates how quickly this happened. Every month I pay them $423.744.  In January 2008, $213.44 of that was interest; in December 2008, only $140.09 is interest.  I’m paying off  $73.35 more in principal every month now than I was a year ago.  That seems like a lot to me.  It’s still going to take me forever and ever to pay these damn things off, but every little bit helps.

And I shall now go back to my regularly scheduled ignoring of my student loans.

1 Part of my loans are through a bank and part are with the government, as they switched loan systems partway through my education. I can’t move my bank student loan accounts from the bank at which I got those loans or they will cease to be “student loans,” and “student loans” come with certain benefits (interest payments are ta- deductible, you have the option to get interest relief should you find yourself out of a job). So I just have this one account at that bank through which I pay both the student loans held by the bank and the ones held by the government.
2Canada Loan through the bank, Ontario Loan through the bank, Integrated Canada-Ontario through the government Student Loan Centrea.
aDespite the fact that more than half of my student life was spent in BC, I was ineligible to get BC student loans as the BC government, for the purposes of student loans, does not consider you a “resident” of BC while you are a full-time student. You are a resident of BC for all other purposes – paying taxes, getting your health coverage, having a driver’s license, getting a divorce – but not student loans. Which sucks, because friends and colleagues keep telling me about loan reduction plans that holders of BC student loans can get which holders of Ontario student loans cannot.
3Assuming, of course, that interest rates don’t skyrocket! *knocks on wood*
4And that’s only half of what I pay. I pay about that same amount to the bank every month as well. Ugh. You can see why I prefer not to think about this!