These are loans provided by your province or territory. In some cases, you may be able to obtain a provincial student loan along with your Canada Student Loan. Or, it may replace a Canada Student Loan if you are denied one or one isn’t available in your province or territory.
It’s important to note that different provinces will have different rules for determining loan eligibility, amounts, and repayment. For a list of helpful links to different provincial and territorial student aid services, click here.
It’s also important to note that if you get both a federal loan and a loan from the provinces of Alberta, Nova Scotia, Manitoba, or Prince Edward Island, you’ll have two separate loan payments to make after you graduate.
4. Student Lines of Credit
Let’s say you either don’t qualify for a student loan, or the funds you received aren’t enough to cover the full amount of your post-secondary expenses. Another option for students who still need money to cover their tuition and/or living expenses while in school is obtaining a student line of credit.
Students can apply for a student line of credit at their bank or another financial institution. But student lines of credit are very different from government student loans and will have different repayment terms, requirements, varying interest rates, etc. There are also other differences that you should know before getting a student line of credit.
For example, in some cases, a student line of credit will require a cosigner. Also, a student line of credit accrues interest while the student is in school, and they may be expected to make payments towards the interest while in school, too.
It’s best to be cautious, read the full terms of a student line of credit, make sure you understand the requirements and repayment schedule, and always read the fine print
Some financial institutions may offer a grace period of a few months after the student graduates or finishes their studies, during which they are only expected to make payments towards the interest on their student line of credit, instead of paying back the principal as well. But these details vary depending on the financial institution.
While a university or college education can help you get the proverbial skills to pay the bills, the impact of student loan debt in Canada cannot be denied.
With the average student loan debt sitting at around $15,300 for college graduates and $28,000 for a Bachelor’s degree, many young Canadians are finding it difficult to start their own businesses, buy homes, or set aside money for the future. Instead, a significant portion of their money goes towards making loan payments and paying interest charges.
The billions of dollars owed by students has had a major economic impact on the country. So, many have started to investigate student loan forgiveness options for Canadians. For example, some political parties have announced plans to push for student loan forgiveness that would cancel up to $20,000 in federal student loan debt per Canadian.
There was also a temporary freeze on federal student loan payments and interest accruing on their student loans, which was announced in . Although short-lived-the freeze ended on e year-the temporary freeze on payments and interest is an example of student loan debt relief in Canada that was a direct result of COVID-19.
Recently, the Government of Canada announced that as of , the interest freeze on Canada Student Loans would be extended until . They have also proposed to extend the freeze for an additional year, until . However, those who owe student loans are expected to continue making their payments; the only difference being that their student loan would not be accumulating interest during that time period.