Canada Student Loans: When Do You Start Repaying?

Canada Student Loan Repayment: Getting a Canada Student Loan can make it easier to pay for college or university. But the money you borrow isn’t free. You must repay a student loan after you finish your studies or leave school.

The good part is that you don’t have to start paying it back right away. Most borrowers get a 6-month non-repayment period after they finish school. This gives you time to find work, manage your money, and prepare for regular payments.

When Do Canada Student Loan Payments Start?

For most students, repayment begins 6 months after their studies end. The same 6-month period can apply if you leave school or move from full-time studies to part-time studies. During this time, you don’t have to make regular loan payments.

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Basically, if your studies end in May, your regular loan payments would normally start after the 6-month non-repayment period. The exact payment start date will be shown in your NSLSC account, and you’ll get a notice before your first payment is due.

The important thing is that the 6 months isn’t a period where you should simply forget about the loan. It’s a good time to check how much you owe, look at your payment details and make sure your bank information and contact details are correct. You can also start paying earlier. Payments made while you’re still in school or during the 6-month non-repayment period are applied to the principal of the loan.

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Do Canada Student Loans Charge Interest?

There is some good news for current and future borrowers. Canada Student Loans have been permanently interest-free since April 1, 2023. This means no new interest is added to the federal Canada Student Loan while you’re paying it back. Interest from before April 1, 2023 may still be owed. Provincial loans can have different rules, and some provinces may still charge interest.

How Long Do You Have to Pay the Loan Back?

Once repayment starts, your monthly payment depends on your loan balance and repayment terms. The usual federal repayment setup is based on about 9.5 years, although the repayment period can be changed in some cases. NSLSC information says a repayment period can be extended to as much as 14.5 years when repayment terms are customized.

You can also make extra payments whenever you want.

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What You Should Do When Repayment is Near

• Log in to your NSLSC account and check how much you owe.
• Check when your first payment is due.
• See how much you need to pay each month.
• Make sure your bank and contact details are correct.
• Set up your payment so you don’t miss the due date.

Missing payments can hurt your credit and make the loan harder to manage. If you’ve started struggling with payments, it’s better to contact NSLSC instead of simply ignoring the loan.

What if You Can’t Afford Your Payments?

Not everyone has a good-paying job immediately after graduation. That’s why the government has repayment help for borrowers who are having trouble making their payments.

The Repayment Assistance Plan, or RAP, may lower your monthly payment or reduce it to $0 depending on your family income and situation. Assistance is usually provided for 6 months at a time, and you have to apply again if you still need help after that period.

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There is also RAP-D for eligible borrowers with disabilities. People with severe permanent disabilities may also qualify for a separate benefit that can cancel their federal student loan debt if they meet the rules.

Borrowers should also remember that repayment rules can be different for provincial loans. For example, Alberta, Nova Scotia and Prince Edward Island handle their provincial loans separately from the federal loan. Quebec, Nunavut and the Northwest Territories also have their own student aid systems.

Canada Student Loan Repayment in Summary

FAQ

1. When do I start paying my Canada Student Loan?

Usually 6 months after you finish your studies, leave school or stop being a full-time student.

2. Can I pay my student loan before the 6 months are over?

Yes. You can make payments during the non-repayment period, and these payments go toward the principal.

3. Does my Canada Student Loan have interest?

The federal Canada Student Loan has been permanently interest-free since April 1, 2023. Old interest from before that date can still be owed, and provincial loan rules may be different.

4. What happens if I can’t afford the monthly payment?

You may be able to get lower or even $0 payments through the Repayment Assistance Plan if you meet the eligibility rules.