Canada Student Loan borrowers who are finding payments difficult may get help through RAP. The program can lower monthly payments or reduce them to $0 based on income and family size.
Canada Student Loan Repayment Assistance Plan: Paying back student loan can be hard when you don’t have a good income after leaving school. Canada has a program that can help borrowers who are struggling with their monthly payments which called the Repayment Assistance Plan (RAP).
RAP can lower your monthly loan payment based on your income and family size. In some cases, your payment can even become $0 for a period of time. You don’t have to wait until your loan is in serious trouble to apply. You can apply once your loan has entered repayment and whenever you’re finding it hard to pay.
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RAP is meant for people who are having trouble paying back their Canada Student Loan. When you qualify, the government can reduce the amount you’re expected to pay each month. Some borrowers may not have to make a payment at all for the approved period.
The help is given for 6 months at a time. When those 6 months are over, you must apply again if you still need help. RAP isn’t an automatic benefit that keeps going forever. Your income and other details are checked again when you reapply.
For borrowers who qualify for RAP, the Government of Canada can cover federal loan interest that isn’t covered by the borrower’s reduced payment. After 60 months on RAP or 10 years after leaving school, the government can also start paying down the principal and any remaining interest. This helps eligible borrowers keep moving toward paying off their loan.
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Your family income and family size are important when the government checks whether you qualify. The current monthly gross family income thresholds listed by the Government of Canada are:
| Family size | Income threshold |
|---|---|
| 1 | $3,866 |
| 2 | $4,535 |
| 3 | $5,556 |
| 4 | $6,412 |
| 5 | $7,170 |
| 6 | $7,854 |
| 7+ | $8,483 |
People whose income is above these amounts may still qualify for reduced payments. The income rules can be different for the provincial part of a student loan.
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When you apply for RAP, the government looks at your financial situation and works out an affordable payment. This amount can be lower than your normal monthly payment. For some borrowers, it can be reduced to $0.
RAP works in stages. During the first stage, the government can cover the federal interest that your affordable payment doesn’t cover. Once you reach the later stage, government support can also help pay down the principal as well as interest that isn’t covered by your reduced payment. The federal government also limits how long eligible borrowers should remain in repayment. In most cases, the repayment period can’t be more than 15 years after leaving school. For borrowers with a disability, the limit is generally 10 years.
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It’s important not to ignore your loan payments while waiting for help. Borrowers who are already struggling should check their NSLSC account and contact the service centre about their available options.
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There is another version of the program called the Repayment Assistance Plan for Borrowers with Disabilities (RAP-D). It can provide extra help to eligible borrowers who have a recognized disability.
RAP-D can lower the monthly payment and may allow a borrower to have no payment at all. Gov of Canada reports that disability-related expenses can also be considered when the application is assessed. Like regular RAP, approval is given for 6 months and borrowers normally need to reapply to continue receiving assistance.
Some people with a severe permanent disability may also qualify to have their federal student debt cancelled through the Severe Permanent Disability Benefit if they meet the program rules.
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Going back to school can change how your existing student loan is handled. You generally don’t have to make payments on an existing federal student loan while you’re back in school.
However, there are restrictions if the government has already paid down your principal while you were receiving RAP. In that situation, you may not be able to receive new federal student grants or loans until the unpaid amount is dealt with. Different rules can apply to the provincial part of your loan.
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Yes. Depending on your income and family size, you may qualify for a $0 payment during an approved 6-month period.
No. RAP is approved in 6-month periods, so you need to reapply every 6 months to keep receiving assistance.
RAP is for loans that are in repayment. Normally, your loan enters repayment after the 6-month non-repayment period following your studies.
No new interest is charged on Canada Student Loans. Provincial student loans may follow different rules, so borrowers with a provincial portion should check their province’s rules.
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