Resume Workshops
For more information on the next upcoming workshop, please contact the Employment Coordinators at the preferred campus.

Join our newsletter

Email this page to a friend

Add our site to your favorites

STUDENT LOAN REPAYMENT

The Basics you should know about your Student Loan.

In order to go to school, you received a student loan. The money borrowed must be repaid.

You actually received two loans – one from the Federal Government called a Canada Student Loan and one from the Provincial Government called a Newfoundland Student Loan.

However, for your purpose your loans will be administered as if you have only one loan serviced through the NSLSC.

You may also have additional loans to repay if you received Canada Student Loans prior to August 1, 2000 or if you have Newfoundland and Labrador student loans that were in repayment status prior to August 1, 2000. You will have to repay those loans directly to the financial institutions that issued them.

You have six months from the last day of your program before you have to start repaying your loan. This is called a grace period. You can however, start making payment on your loan as early as you want since interest is added to your balance during the grace period.

You are responsible for ensuring that your loans are in good standing. We can provide helpful information and reminders in this booklet, but the responsibility is on you to take charge of repaying your loan or taking the necessary steps to delay paying on your loans right away.

Your student loans do not go away. They are real loans and lenders will expect they be paid like any other loan.

For some reason you have ended your program before graduating. Here is some information you will need to know about your student loans:

You are still required to repay student loan money borrowed if you withdraw or are dismissed.

The College notifies your lenders that you have ended your program early. Therefore, you will have six months from your withdrawal date to start repaying your loan.

If you are entitled to a tuition refund, it will be sent to the lenders of your student loans to be applied against your loan balance.

It may be possible that you will still have an outstanding balance with the College depending on when you withdrew from studies.

You should follow the steps outlined in this booklet for helpful information regarding repaying your student loans.

In the repayment section of this booklet it discusses a program called Debt Reduction Grants. Unfortunately, this option does not apply to students who withdraw. However, there are still several programs you may qualify for while repaying your student loan.

You will finish school in one month. Here’s what you need to know:

Know who your lenders are. It is important you know who you borrowed money from to attend school.

If you received student loans after August 1, 2000 you will repay the National Student Loan Service Centre. If you had loans before August 1, 2000, you may have to repay a financial institution such as CIBC, Scotia bank, Royal bank, etc. You can contact your Campus Business Office for help determining your student loan lenders.

Contact your lenders (see next page) to ensure they have the correct end date, address, and telephone number on file for you. This is important because your lenders may have the wrong end date on file which may cause you to enter repayment of your loans before the six-month grace period.

If your lenders have the wrong end date on file for you, come to the Business Office to get a Schedule II or Continuation of Enrollment form completed. It is important that you do this before your program ends since lenders will not accept this form after you finish.

It has only been a month since you finished your program, however, you do need to start thinking about repaying your student loans. Here are a few things you need to do:

Contact your lenders to discuss consolidating your student loans. Consolidating means to combine all the student loans you have had into one loan. During this consolidation, the repayment terms and interest rate for your loans will also be determined. Relax! It’s not as complicated as it sounds. Most lenders will set your loan repayment at the standard nine years and current interest rates.

If you do not contact your lenders to consolidate your loans, they will do it for you. However, whether you sign a consolidation form or not, you will still be responsible for repaying the loan.

Review the “Repayment” section of this booklet for more details on programs/options to help you.

Interest Relief- the government will make the interest payment on your loan while you are unable to pay.

Revision of Terms- your lenders will extend the repayment period of your loan which will reduce your monthly payments

Extended Interest Relief- you can extend the number of months you are eligible to receive interest relief

Debt Reduction Repayment- a program offered by the Federal Government to reduce the balance of your Canada Student loan.

Debt Reduction Grants- a program offered by the Provincial Government to have a portion of your Newfoundland Student loan paid to your lender by the Government.

Early Childhood Education Grant- a program offered to help reduce the student loan debt of Early Childhood Education students.

It has been six months since you finished your program, now is the time to seriously consider your options regarding paying back your loan. You have three options:

Option 1: Start repaying your loan

Contact your lenders to decide on how and where you will make your payments. You will need to sign a consolidation agreement and this will set the terms of your repayment schedule. It will state the interest rate, and full amount of the loan, when your first payment is due, the number and frequency of your payments and the amount of each payment.

If you received Canada Student Loans before August 1, 2000 or Newfoundland and Labrador Student Loans that were in repayment before August 1, 2000, you must sign another consolidation agreement with the financial institutions holding these loans.

Option 2: Consider options to delay your payments

If you choose Option 2, review the various options available to help you with your repayment.

Option 3: Ignore your loans

If you choose Option 3, you will go into default on your loan and your lenders will take action to recover the money you owe them, including:

reporting you to a credit agency
use a private collection agency
take legal action against you

If your loans are sent to a credit agency and you develop a poor credit rating you will have a lot of trouble trying to get a car loan, house mortgage, credit card, etc. Under legislation introduced in 1998, you cannot avoid repaying your student loan through declaring bankruptcy for a period of ten years following the completion of your studies.

Contact the Business Office if you have any questions or would like help completing your Interest Relief Applications, etc.

Get Ready

You are about to enter repayment of your loans.

You have now entered repayment status on your student loans. Here’s what you need to know:

The first payment on your student loans will be required on the last day of the seventh month following your end date. For example, if your program ends August 9, 2006, your first payment is due on March 30, 2007.

If you are ready to repay your loans, make sure you have made arrangements regarding your method of payment.

If you applied for interest relief, contact your lenders to ensure you have been approved.

Remember-You will be responsible for making payment on your loans until your interest relief applications have been approved.

Repayment of Student Loans

Interest Relief

Interest relief is a program where the government pays the interest on your student loan if you experience difficulty in repaying your loan.

The agreed repayment term of your student loan will be extended by the length of the approved period for interest relief.

You are not required to make payments on your loan while you have been approved for Interest Relief.

You must complete an application to obtain Interest Relief.

You can be eligible to receive interest relief for up to 30 months, (2 ½ years) at any time throughout the repayment of your loan and an additional 24 months (Extended Interest Relief) if it’s within the first five years of your end of study date.

You will have to apply for interest relief every six months, if needed.

Revision of Terms

Revision of terms is an option to extend the repayment period of your loan.

A student loan is normally repaid within nine years, however, a revision of terms will extend the repayment period for up to 15 years. This will reduce you monthly payments by approximately 25% of your current payment.

To be eligible for this option you must have exhausted all your interest relief.
To apply you must contact the lender of your student loan and tell them you would like a Revision of Terms.

Extended Interest Relief

Extended Interest Relief is an option to go back to interest relief if you are still having trouble making your loan payments after the Revision of Terms option and the initial interest relief period.
To be eligible it must be less than five years since you finished school.

To apply contact the lender of your student loan and tell them you would like to apply for Extended Interest Relief.

Debt Reduction Repayment

Debt Reduction is a Government of Canada program where you can apply to have a portion of your Federal Student loan principal reduced.
To be eligible you must have exhausted all other debt management options, have been out of school for five years and your loan payments must exceed a given percentage of your income.

If you qualify you may be given a loan reduction of up to $10,000. As well, you may be eligible for two additional reductions of $5000 each if you are still unable to repay your loan after this initial reduction.

Early Childhood Education Grant

Early Childhood Education Grant is an initiative offered to Early Childhood Education students to help repay their student loan debt. Students graduating from this program generally have low wages and find it difficult to repay a large student loan.
To be eligible for this grant you must:

have graduated from a two year Early Childhood Education program
have borrowed for at least half your program duration
have graduated within a timely manner as defined by Student Financial Services, Department of Education
obtain full time employment of at least 30 hours per week in a licensed childcare centre or licensed family home for a period not less than 24 months with Newfoundland and Labrador immediately after graduation

There is no application form for this grant. Student Financial Services will create an eligibility list for students who meet the above criteria. The student must then confirm graduation and employment in order to be awarded the grant.

Debt Reduction Grant

Debt Reduction Grants is an initiative introduced by the Provincial Government to help reduce the student loan debt of graduating students. This program converts the provincial portion of your student loan into a non-repayable grant, pending you meet the qualifications.
To qualify you must have:

Graduated from a program of at least 80 weeks in duration
Borrowed more than $165 per week during a semester
Been successful in at least 80% of a full course load in a semester, except where it is determined that you have extenuating circumstances
Applied and borrowed money for at least half the required length of your program. For example, if your program was 90 weeks in duration, you must have borrowed student loans for at least 45 of those weeks.

Here is an example to show you the amount of debt reduction grant you may be eligible to receive if you meet the above qualifications:

Semester one is 17 weeks in duration:

CSL $165 x 17 weeks = $2805

NSL $110 x 17 weeks= $1870

Total borrowing amount $4675

The borrowing amount in excess of $165 per week is $1870. Therefore, you would receive $1870 in a Debt Reduction grant.

You do not have to complete an application to qualify for this program. You will be assessed by Student Financial Services, Government of Newfoundland and Labrador and notified of the qualifying amount.
You must send a letter to your campus business office to give us authorization to send your personal information to Student Financial Services to determine your eligibility for this grant.

Responsibilities

STUDENT

Your role as a student is to:

Report changes in your address, name, marital status, financial status, or student status (withdrawal, transfer to part-time studies, or change of school) to your financial institution and/or the NSLSC;
Keep track of how much you borrow, like other types of loans, a student loan must be repaid over a period of time, with interest, so you don’t want to borrow more than you can afford to pay back;
Give your financial institution and/or the NSLSC proof of enrolment for each study period in which you are enrolled, even if you are not applying for a new student loan;
Contact your financial institution and/or the NSLSC to set up your repayment schedule after you finish your program of study; you must repay your loan whether you graduate or not.
Record/file everything regarding student loans.
Repay your student loans.

FEDERAL GOVERNEMNT

The federal government provides access to post-secondary education through federally funded loans and Canada Study Grants, both of which are administered provincially.

The role of the National Student Loans Service Centre (NSLSC) is to:

Process your Canada Student Loan documents (the documents you sign to accept your loan once your application has been assessed by your provincial or territorial Student Assistance Office;
Arrange for your loan funds to be deposited to your bank account;
Help you keep track of the total amount of your loan throughout your studies and the amount you have to repay;
Work with you to set up a loan repayment schedule;
Administer repayment assistance programs.

PROVINCIAL GOVERNMENT

Provincial governments administer federal student loans and grants in addition to administering provincial loans and grants.

The role of your provincial Student Assistance Office is to:

Make application forms and program guides available;
Communicate information about all available programs and services;
Respond to queries from students and educational institutions;
Assess financial need for each applicant;
Authorize the amount of funding to be provided to qualifying students through federal and provincial loan, bursary, and grant programs;
Undertake credit checks;
Review assessments on request;
Distribute bursary/grant cheques to schools on behalf of students.

POST- SECONDARY EDUCATION

Post-secondary educational institutions have varying roles to play depending on their size and the ability of each to assist in the student assistance process. In general, however, they carry out a key role in helping students obtain Canada Student Loans.

The role of your post-secondary institution (where applicable) is to:

Educate and counsel you on all student financial assistance programs available;
Confirm your enrolment in school by signing your Certificate of Eligibility;
Confirm your enrolment in school each year by signing a Confirmation of Enrolment form, which you must send to your financial institution and/or the NSLSC;
Liaise with your provincial or territorial Student Assistance Office in cases of review;
Liaise with your financial institution and/or the NSLSC when necessary.

GLOSSARY

Default: A Student Loan is considered delinquent when your payments are behind and is considered in default when your payments behind three or more months and collection activities are required.

Consolidation: Student loans are combined to make one loan. An agreement is sent indicating how much you have borrowed and the terms of repayment. If you have loans with a financial institution, these loans will not be consolidated with ones at the NSLSC.

Financial Institution: A bank or credit union holding Canada Student Loans issued before August 1, 2000.

Grace Period: The six-month period after you either graduate or leave school. Loan payments are not required during your grace period, although interest on your loan begins to accrue during this period.

Integrated Student Loan: Using the philosophy of “One Student – One Loan”, the Government of Canada and Newfoundland and Labrador have combined their full-time loans programs. This became effective April 1, 2004. Please check with the NSLSC to determine if your loans have been combined.

Loan: Money borrowed that must be paid back.

Maintenance: Maintain your loan by keeping your loans up to date. Not having your loans current at the end of every month will put your account in arrears.

Repayment: The status of your student loan when your six-month grace period or interest-free status period has ended.

Schedule 2: Confirmation of Enrollment form that both you and your post-secondary institution complete as proof that you are enrolled in school full time. This document keeps your student loan interest free and ensures that you do not begin repayment of your loan while you are still in full-time studies.

Important Numbers/Addresses
National Student Loan Service Centre

Private Institutions Division

P.O.Box 779 Station U

Toronto, ON M8Z 5P9

Tel 866-587-7452

Fax 866-587-7453

www.canlearn.ca

CIBC National Student Centre

P.O.Box 5055

Burlington, ON L7R 4P3

Tel 800-563-2422

Fax 800-931-2000

Scotia bank Student Loan Centre

P.O.Box 9 Station “U”

Toronto, ON M8Z 5M4

Tel 888-284-3044

Royal Bank Student Centre

P.O.Box 2046

CRO Halifax, NS

B3J 2Z1

Tel 800-565-1446

Fax 877-421-7435

Student Financial Services

Department of Youth Services and

Post- Secondary Education

P.O.Box 8700

St. John’s, NF A1B 4J6

Tel 709-729-5849

Fax 709-729-2298

www.edu.gov.nf.ca/studentaid/