After Post Secondary Education

General Information

1. Q. What is student loan consolidation?

A. Student loan consolidation occurs when any student loans you have received during the course of your studies are brought together into one repayment plan. For example, if you received Canada Student Loans during your first, second and fourth year of a four-year program, then the loans would be consolidated six months after your study end date to enable you to make one payment towards these outstanding loans. Your Consolidation Loan Agreement will outline your repayment details.

2. Q. Which provinces offer Integrated Loans?

A. Saskatchewan, Ontario, New Brunswick, Newfoundland and Labrador, and British Columbia offer Integrated Loans. If your province of residence when you started school was one of the first four provinces listed above, or you are a BC resident with an integrated loan under the Master Student Financial Assistance Agreement, student loan payments are made to the National Student Loans Service Centre (NSLSC).

However, loans must be repaid directly to the financial institution that issued them, if you received:

• an Ontario Student Loan before August 1, 2001;
• a Saskatchewan Student Loan before August 1, 2001;
• a New Brunswick Student Loan before August 1, 2000; or
• a Newfoundland Student Loan before August 1, 2000.

Note for BC residents: British Columbia student loan borrowers who are currently in repayment will continue to make separate payments to the NSLSC and BC Student Loan Service Bureau until July 2012 when their federal and provincial loans are Read more on British Columbia's student loan integration integrated at the NSLSC.

To find out where full-time students holding non-integrated loans make their payments and who part time students pay back, please see Where to Make Payments.

3. Q. When do I have to start paying back my loan?

A. Most student loan programs give you a period of at least six months after your post secondary studies before you have to start making payments. This is known as a definition of grace period. However, if your loan was for a full-time program, be aware that interest is often charged as soon as you finish school.

You can choose to either:

• start making the interest payments right away; or
• have your loan providers add the interest amount to your loan total after the six month grace period.

Please note that, if you choose to add the grace period interest to your loan amount, you won't be eligible for a tax deduction for the payment of that interest.

Part-time students do not have to start repaying their student loan until six months after they graduate or leave their studies. However, interest will accumulate while they are in school and during the six month grace period. Part-time students can choose to pay the interest accumulating on their loan while they are still in school.

4. Q. What's the difference between a Canada Student Loan and a Canada Student Grant in terms of repayment?

A. Loans are repayable while grants are not. When you receive a Canada Student Loan, you have to begin paying back the loan six months after you complete or leave your studies. Interest will accumulate during that six-month period. When you receive a Canada Student Grant, you do not have to pay the money back.

5. Q. Can I make payments before the six month grace period is up?

A. Yes. In fact, making lump sum payments during the grace period is a great way to pay your accumulating interest and reduce your student loan principal. You can also make lump sum payments while you're still in school. These payments bring down the total interest you would otherwise have to pay on the loan in the long run.

6. Q. I have to relocate to another city for a new job. How can I make sure that my loan providers have my most up to date contact information?

A. If you are moving, it is up to you to give your loan provider(s) your new address, phone number and other contact information. This is easy to do. For Canada Student Loans and Integrated Loans, simply log on to your NSLSC Online Account and update your contact information. For all other provincial or territorial student loans, contact the province or territory which you received your student loans.

7. Q. I was a full-time student, but I had to cut my course load back to part time studies. Will this affect my student loan?

A. You must keep your loan providers up to date on the status of your studies. If you recently became a part-time student, then interest will begin to accumulate on the loans received during your period of full-time study; however, you will not have to begin making payments until six months after you graduate or leave your studies. Talk to your loan providers to find out more.

8. Q. What happens if I don't have the money to make my student loan payments?

A. Contact the NSLSC when you first think that you may have difficulty repaying your loan, before you miss any payments. Staff can help you to understand the measures that are available.

If you have student loans through a government program, you may qualify for several types of help. (Your province or territory of permanent residence may also have programs to help you repay your loans. Check with your Provincial/Territorial Student Assistance Office.) See Can't Repay? for more information.

Take advantage of available repayment assistance. You don't want to default on your student loans because, if you do, you could face additional interest charges and the loss of future student loans and/or income tax refunds. You may also have to deal with a collection agency and possibly face legal action. You would also establish a bad credit rating.

Repayment Assistance Plan (RAP)

The Repayment Assistance Plan (RAP) is available to borrowers who are having difficulty paying back their student loans. RAP makes it easier for student loan borrowers to manage their debt by allowing them to pay back what they can reasonably afford.

The Repayment Assistance Plan replaces the Interest Relief and Debt Reduction in Repayment programs. Borrowers who were approved for Interest Relief and Debt Reduction in Repayment before August 1, 2009 will continue to benefit from these programs until the end of their approved period. However, these borrowers also have the option of applying for the Repayment Assistance Plan any time.

A Repayment Assistance Plan for Borrowers with a Permanent Disability (RAP-PD) is also available.

Student loan borrowers must apply for the Repayment Assistance Plan. Enrolment is not automatic.

Permanent Disability Benefit

The Permanent Disability Benefit is available to borrowers with a severe permanent disability. If you have a severe permanent disability, you may be eligible to have your loans immediately forgiven.

Students with a severe permanent disability who received loans between 1995 and 2000 will now be eligible for immediate loan forgiveness regardless of when the severe permanent disability occurred.

Revising the Terms of your Loan

Under the Revision of Terms measure, you can ask to decrease or increase your student loan payments if you are having difficulty in repaying your loan or you wish to pay off your loan more quickly.

Tax Relief

Visit this page to find out about the kinds of tax relief the Government of Canada offers students.

9. Q. Is it true that, if I declare bankruptcy shortly after graduating from school, I won't have to pay back my Canada Student Loan?

A. Effective July 7, 2008, even if you declare bankruptcy, your Canada Student Loans or Integrated Student Loans cannot be discharged until seven years (five years in the case of exceptional financial hardship) after you've finished your studies. That means that your student loans must be paid back even after you declare bankruptcy.

10. Q. How long do I have to wait before my student loan debt can be discharged from bankruptcy?

A. Bankruptcy should always be a last resort. Because we understand that declaring bankruptcy is a hard decision with serious consequences, there are measures to help you with your student debt before you reach that point.

Effective July 7, 2008, the waiting period before student loan debt can be dischargedFootnote ¹ from bankruptcy has been reduced from ten to seven years. If your student loan was not discharged from the bankruptcy process by this date, the seven year period applies to you. In the case of exceptional financial hardship, the waiting period has been reduced to five years.

To find out if your loan has been discharged, contact your bankruptcy trustee. For more information about bankruptcy, visit the Office of the Superintendent of Bankruptcy Canada website.

11. Q. How do I prove that I am experiencing exceptional financial hardship?

A. To prove that you are experiencing exceptional financial hardship, you must demonstrate to the Court that you have acted in good faith and that you will continue to experience financial difficulties. To find out more, contact your bankruptcy trustee.

Repayment Assistance

12. Q. What is the Repayment Assistance Plan?

A. The Repayment Assistance Plan (RAP) is available to student loan borrowers who are having difficulty making their Canada Student Loan payments. Under the Plan, the amount borrowers are required to pay back is based on the borrower's family income and family size.

The Repayment Assistance Plan replaces the Interest Relief and Debt Reduction in Repayment programs. Borrowers who were approved for Interest Relief and Debt Reduction in Repayment before August 1, 2009 will continue to benefit from these programs until the end of their approved period. However, these borrowers also have the option of applying for the Repayment Assistance Plan any time.

13. Q. Who is eligible for the Repayment Assistance Plan?

A. To be eligible for the Repayment Assistance Plan, borrowers must:

• be a resident of Canada;
• have received their Consolidated Student Loan Agreement; and
• be unable to afford the calculated monthly loan payment amount required under a standardized amortization period.

Student loan borrowers must apply for the Plan. Enrolment is not automatic.

14. Q. How do I apply for the Repayment Assistance Plan?

A. Call the National Student Loans Service Centre (NSLSC) at 1-888-815-4514.

If you received a student loan after August 1, 2000, you can apply for repayment assistance by contacting the National Student Loans Service Centre (NSLSC) to request an application form. Once you've completed the application form, you must submit it to the NSLSC, along with the required supporting documentation.

National Student Loans Service Centre
Toll free: 1-888 815-4514 (within North America)
800-2-225-2501 (outside North America)
TTY: 1 888 815-4556

Remember: Enrolment is not automatic. Borrowers must submit an application and reapply every six months in order to maintain their eligibility.

15. Q. If I've exhausted my 54 months of Interest Relief, can I still qualify for the Repayment Assistance Plan?

A. Yes. Borrowers who have exhausted 54 months of Interest Relief are still eligible for the Repayment Assistance Plan.

16. Q. Will the Repayment Assistance Plan change how I repay my Canada Student Loan?

A. The repayment of your loan will not change under the Plan. The Repayment Assistance Plan is for those borrowers who are having difficulty repaying their loan. Enrolment is not automatic; you must apply for the Repayment Assistance Plan.

17. Q. What will happen to the former debt management programs - Interest Relief and Debt Reduction in Repayment?

A. The Repayment Assistance Plan replaces the Interest Relief and Debt Reduction in Repayment programs. Borrowers who were approved for Interest Relief and Debt Reduction in Repayment before August 1, 2009 will continue to benefit from these programs until the end of their approved period. However, they also have the option of applying for the Repayment Assistance Plan any time.

18. Q. I'm having difficulty paying back a loan for part time studies. Can the Repayment Assistance Plan help me?

A. Yes. If you have a student loan for part time studies and are having difficulty paying back your loan, you can apply for the Repayment Assistance Plan.

Under the Plan, borrowers will see their debt gradually reduced over a 15 year period and the federal government will cover the difference between the borrower's affordable payment (calculated based on family size and family income) and their required payment (calculated by the Canada Student Loans Program). No borrower should have a repayment period longer than 15 years (or 10 years for persons with permanent disabilities).

Contact the National Student Loans Service Centre (NSLSC) when you first think that you may have difficulty repaying your loan, before you miss any payments. Staff can help you to understand the measures that are available.

19. Q. I’m currently repaying a loan for full-time studies and I am in school part-time. Am I eligible for the Repayment Assistance Plan (RAP) while studying part-time?

A. Yes. While studying part-time, you are eligible for RAP, but only on your full-time loan. You must have signed your Consolidated Student Loan Agreement for your full-time loan and your full-time loan must be in repayment. For more information on the eligibility requirements for RAP, please call the National Student Loans Service Centre (NSLSC) at 1-888-815-4514.

20. Q. How does the Repayment Assistance Plan help student loan borrowers with permanent disabilities?

A. Repayment assistance is available under a Repayment Assistance Plan for Borrowers with a Permanent Disability (RAP-PD).

Under the Plan, qualified borrowers with a permanent disability do not make payments exceeding 20 percent of their income toward loans covered by the Plan. In certain cases, borrowers may not have to make any loan payments until their income increases. Students with a permanent disability go directly to Stage II of the Plan and should be able to fully repay their student loan within 10 years of leaving school (as opposed to 15 years under the Repayment Assistance Plan).

You must apply for the Repayment Assistance Plan; enrolment is not automatic.

Students with severe permanent disabilities who are prevented from working or attending a post secondary educational institution and who will never be able to repay their loans may be eligible to have their Canada Student Loan forgiven through the federal Permanent Disability Benefit, regardless of when their disability occurred.

21. Q. How does the Repayment Assistance Plan help medical, law, and other students?

A. Under the Repayment Assistance Plan, all borrowers - including medical residents, articling students and others - can make definition of affordable loan payments based on their family income and family size.