Under the BCBPA ( British Columbia Business Practices Act ), the limitation period for the collection of a commercial debt, which includes a line of credit, is 6 years. Your defaulted line of credit with TD Canada Trust is well within the current limitation period and for an amount outstanding of $18K, don't be surprised if a Statement of Claim shows up on your doorstep from TD Canada Trust. From my experience and observation, this bank appears to be the most persistent of all the major banks in collecting an unpaid debt. Quite frankly, I'm surprised that you got an offer of $5k to settle. TD Canada Trust does not normally consider a settlement less than 50%, especially when the debt is still within the limitation period for taking legal action. My suggestion to you is if you can settle this debt for $5K, give it very serious consideration. If you reject this offer, be prepared to meet TD Canada Trust in a courtroom, where if a judgment is obtained, they will ruthlessly pursue you to enforce it. This can include garnishment of income and possibly seizure of assets. Remember, judgments stay on your credit reports for 6 years and your credit score will "go south" overnight.

Hi richp00,

Find out what the statue of limitation is in your province, they may not be able to take you to court. In fact they may not have any recourse. I would clarify these points with a lawyer. Hope this helps.

When you settle a debt for less than the balance owing, you don't arrange an installment plan to pay down the debt. If a debt is owing for $18k and you come to an agreement with the creditor or collection agency to settle the debt for $5K that means you have to come up with a lump sum payment of "5 big ones". The fact that a creditor or collection agency has reduced the debt doesn't mean that the debtor can now start paying on the "never never plan". It simply means that the debtor comes up with the "dough" or there is no deal.

If I'm not wrong, when you settle an 18k debt with 5k, it will still be recorded as a bad debt because you did not fully settle it. And if you go to court, they are likely to want 18k back from you.

I would consider taking the 5k offer and try to bring it down a little more. Then arrange for an installment plan with them to repay the 5k. Maybe consolidation loans may suit your situation.

Hello everyone,

I am currently in default with a TD Canada Trust line of credit. I owe approximately 18 k. I have been in default for approximately 2 years and 9 months. My account is currently at the 3rd collection agency. I have been offered a settlement for 5000 dollars.

Money is currently tight, I pay off about 600 dollar a month in student loans already. Taking my credit rating into account, I realize that this delinquency would leave my credit score sooner if I didn't pay, then if I was to pay. I currently have no recoverable assets, but I do have a full time job.

Is it worth paying this off and taking the settlement or waiting this out?
That being said, I would really like to avoid going to court; Does TD have a history of taking their customers to court over defaulted lines of credit?

Thank you for taking the time to read this and for your help.