You are responsible for repaying all the loans you borrow to fund your education as per the terms and conditions detailed on your Master Student Financial Assistance Agreement (MSFAA) or your loan certificate if you borrowed prior to the 2012-13 academic year.
For the first 6 months after your post-secondary studies, you do not have to start repaying your loans, although interest does accumulate on your Canada Student Loan during this period.
Six months after you have ended studies, regardless of whether you have graduated, withdrawn or are taking time off, you will have to start repaying your student loan. This is called student loan consolidation or repayment phase. For example, if you finish school on April 16, your student loans will consolidate on November 1 and your first loan payment will be due at the end of that month, on November 30.
Interest begins to accrue only on the Canada Student Loan portion of your student loan. No interest will accumulate on the Newfoundland and Labrador portion of your student loan. The interest rate on Canada Student Loan payments is prime plus 2.5% and you have the option of a one-time lock in at prime plus 5%.
The NSLSC manages the repayment of your student loans on behalf of the Government of Canada and the Government of Newfoundland and Labrador.
You can expect to receive a loan consolidation package 4 to 5 weeks prior to your consolidation date. This package will be forwarded to the most recent address on file at the NSLSC. It is important that you advise the NSLSC of any changes to your address or other contact information. Read the information in your consolidation package carefully and respond to all requests from the NSLSC for information, signatures or other needs.
Note: Even in situations where, due to error, you do not receive the consolidation package or you do not respond to the information provided, repayment of your student loans will still begin, which means that monthly payments will be deducted from your bank account at the end of each month.
You are not required to make payments on your loan while you are in-study, and interest does not begin to accrue until your studies are complete. Repayment starts 6 months after the completion of your part-time studies (i.e., at the end of the non-repayment period).
It is important to ask for help as soon as you feel you are having difficulty meeting your repayment obligations as you may qualify for repayment assistance.
As a borrower, you are required to fulfill your obligations and responsibilities so it is important that you fully understand the terms and conditions of your loan. Missing payments could damage your credit rating and your student loan could go into default. If you are having difficulty making your loan payments, contact the NSLSC . There are programs and services available to help you manage your payments and avoid defaulting on your loan.
This program allows for up to the full amount of the provincial portion of a student loan to be converted into a non-repayable grant. There is no application process. Students are automatically assessed after the Student Financial Services Division receives notification that the student has graduated.
You are eligible for a Debt Reduction Grant if:
**If you are a work-term student, the program length will be based on your total number of academic terms plus any work-term semesters for which you were deemed eligible for student loans.
Grants are calculated on the basis of a semester or academic year; however, benefits are not paid until you graduate. Canada Millennium Bursaries or Transition Grants previously awarded are subtracted from the total Debt Reduction Grant for which you are eligible.
In an effort to reduce student debt and ensure timely completion of studies, this program promotes the participation of students who take and complete a full course load. The following example illustrates the advantage for such students.
Example: Emily received a total of $5,950 in financial assistance, $1020 ($60 per week) of which was in provincial loans during the fall 2011 semester. Because she successfully completed a full course load, her Debt Reduction Grant for that semester was equal to the full provincial loan of $1020. If Emily had enrolled in only 80% of a full course load, the maximum grant she could have received would have been only 50% of that amount (i.e., $510).
In certain situations, borrowers may qualify for a Debt Reduction Grant if they are taking less than 80% of a full course load. For example, this would include borrowers approved by the Student Financial Services Division for assistance for full-time studies while taking less than 80% of a full course load and students with permanent disabilities. However, to be eligible for the full Debt Reduction Grant, these students must be successful in all courses for which the reduced course load was approved.
Borrowers may also be eligible for the Debt Reduction Grant if they demonstrate that extenuating circumstances beyond their control have caused them to be unsuccessful in completing 80% of a full course load. In such cases, approval for the grant will be determined upon review of a written appeal.
Attending Schools Outside the Province
Borrowers who attend a designated school outside the province may also be eligible for the Debt Reduction Grant if they went out of province for at least one of the following reasons:
Note: Borrowers are required to provide the Student Financial Services Division with appropriate documentation to support their case.
Programs Less Than 80 Weeks in Duration
Borrowers may be eligible to receive Debt Reduction Grants for programs that are less than 80 weeks in duration if the program(s):
A separate application is not required; however the Student Financial Services Division requires the following information to determine a student’s eligibility:
Note: This information can be submitted by the school using the Debt Reduction Program Monitoring Form that is sent to them. If the school does not provide this information to the Student Financial Services Division, the borrower is encouraged to submit the information directly.
Under the Debt Reduction Grant Program, borrowers must respond to all requests for required documentation from the Student Financial Services Division within 2 years of graduation.
Note: Borrowers who do not apply for financial assistance during the final period prior to graduation should contact the Student Financial Services Division so that their eligibility for a Debt Reduction Grant can be determined.
Borrowers may appeal decisions made by the Student Financial Services Division pertaining to Debt Reduction Grants. However, appeals will not be considered prior to the release of a debt reduction notice.
Deadline: You must submit your appeal within one year from the date you were notified of the original decision.
All Debt Reduction Grants are subject to audit, which could result in overpayments. In such cases, the amount overpaid will be added to the balance of the provincial student loan.
Note: In cases where the provincial portion of the loan has been paid in full, the student will receive the remaining debt-reduction funds in the form of a cheque.
No application is required. The Student Financial Services Division will notify you if you meet the eligibility requirements. If you qualify, the outstanding balance of the provincial loan borrowed while you were studying Early Childhood Education will be forgiven by converting into a non-repayable grant upon confirmation that you have met all requirements.
You qualify if:
Note: In cases where the provincial portion of the loan has been paid in full, the student will receive the balance of the grant in the form of a cheque.
If you’re having difficulty repaying your loan, contact the NSLSC before you miss a payment. Repayment assistance is available to help you manage your payments and avoid defaulting on your loan.
You are responsible for repaying all the money you borrow to fund your education. However, if you’re having difficulty making your student loan payments, the Repayment Assistance Plan (RAP) can help.
The RAP makes it easier to manage your debt by requiring you to pay back only what you can reasonably afford based on your family income and family size. Monthly payments are limited to less than 20% of a borrower’s family income, and no borrower will have a repayment period of more than 15 years (10 years for borrowers with permanent disabilities). In cases where borrowers earn very little income, they may not have to make any loan payments until their income increases.
The NSLSC administers the RAP on behalf of the governments of Canada and Newfoundland and Labrador. If you face financial difficulty after completing your studies, call the NSLSC (1-888-815-4514) before you begin missing payments. Help is available.
NSLSC Online Services enable you to review your student loan accounts and to view and change your contact information. Visit CanLearn.ca to sign up for an online account.
How Does the RAP Work?
Depending on your financial circumstances, the RAP has 2 stages to help you fully repay your student loan within 15 years.
This stage applies to the first 5 years of the plan.
This stage starts once the borrower completes Stage I or after the borrower has been repaying the loan for 10 years.
Am I eligible?
To be eligible for the Repayment Assistance Plan you must:
How do I apply?
You need to apply for the RAP; enrolment is not automatic.
Repayment Assistance Plan for Borrowers with a Permanent Disability
The Repayment Assistance Plan for Borrowers with a Permanent Disability (RAP-PD) helps borrowers with permanent disabilities who are having difficulty repaying their student loans. The RAP-PD makes is easier for borrowers to manage their debt by allowing them to pay back what they can reasonably afford.
Under this plan:
How do I apply?
You need to apply for the RAP-PD; enrolment is not automatic.
You may be able to make arrangements to pay only the interest portion of your loan payments or to extend the repayment period for up to a maximum of 15 years. Contact the National Student Loan Service Centre for details.
As a borrower, you are required to fulfill your obligations and responsibilities so it is important that you fully understand the terms and conditions of your loan. Missing payments could damage your credit rating and your student loan could go into default. If you are having difficulty making your loan payments, contact the NSLSC. There are programs and services available to help you manage your payments and avoid defaulting on your loan.
Are you a student-loan borrower who:
If so, and if you have not yet begun repaying your loan at the time of filing, you may be eligible for a student loan for full-time study covering up to 3 additional years to complete your current program of study.
As of July 7, 2008, the waiting period to have a Canada Student Loan debt discharged under a bankruptcy was reduced from 10 to 7 years.
If you can provide proof of exceptional financial hardship, the waiting period will be reduced to 5 years. To qualify for this reduction, 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, you should contact your bankruptcy trustee.