Over half of Canadian graduates have made use of student loans during their study period. No doubt, there are lots of students or prospective students in need of financial assistance to begin or complete their studies in Canada.
If you are a new or prospective student considering taking a National Student Loan in Canada, here are ten things you need to know!
How does the Canada Student Loan work?
The Canada Student Loans Program is one of the most extensive programs in Canada, providing students with financial aids. It was established by the Canadian Government to make college education available to students with financial constraints.
To ease the loan process, the Federal Government has partnered with provincial/territorial governments to organize the provision of student loans and grants. Provinces partaking in Canada student loans program include all jurisdictions and regions excluding Nunavut, Québec, and the Northwest Territories.
Am I Eligible for a National Student Loan in Canada?
National student loans in Canada are open for both full-time and part-time study at any chosen school. It would be best if you met the following criteria to qualify for a student loan.
- You must be a Canadian citizen, a protected person or have a permanent residence of Canada
- Be a resident of jurisdiction or region that partakes in the Canada student loans program
- Show financial need
- Be registered in a degree program, certificate program or diploma with a period of at least 12 weeks at a chosen institution
- Pass a credit check if you are within age 22 or above and a first-time applicant
- Must be within the lifetime limit of financial assistance
How much can I apply for as a Student?
The amount of funding available via the Canada Student Loans Program is calculated based on the evaluated financial need. The funds accessible differ depending on the student’s program, either full-time or half-time. For full-time students, the program offers 60% of the evaluated need and about $210 weekly while the remaining 40% may be provided through provincial student loans.
You can get Canada student loans for the duration of your academic program, with an extra year if required to conclude the program. Full-time students have a maximum lifetime limit of 340 weeks of support, with a lengthened period of 60 weeks for students registered in doctoral studies.
If you are a part-time student, you can get up to $10,000 throughout your studies, and there is no maximum time limit of support.
What are the Documents required for the National Student Loan Application?
Documents needed for your loan application process include:
- Admission letter from university/institution (Proof of admission)
- Loan application form
- Passport size photographs
- Academic documents (certificates and mark sheets)
- Applicant’s social insurance number (SIN) and Health services number (HSN)
- Parent’s SIN, HSN, Date of Birth (DOB), and marital status if the applicant is dependent
- If the applicant is married, the spouse’s SIN, HSN, DOB and occupation will be required
- Children’s HSN and DOB if an applicant has children
What is the Loan Application Process?
To get a national student loan in Canada, you need to apply through the student financial assistance office of your jurisdiction or region of permanent residence. A single application will give you access to be considered for provincial student loans, Canada student aids, and Canada student loans.
For instance, when you apply as a student from the Alberta province, you will be considered for the Alberta Student loans and the Canada student loans as well. However, you should send in your application yearly to keep receiving funds.
To speed up the application process, it is advisable to apply online. In contrast, if you would prefer to submit a paper application, the forms are available to be picked up at the student financial assistance office of your school.
The loan application process takes a few business days to several weeks, depending on your application method, province and time of the year. It is advisable to apply early and fill all documents completely. Incomplete documentation can hinder or delay your application process.
When and How do I get my funds?
If there are no issues with your documentation, the school will be required to confirm your registration and state the amount of tuition and fees that you have unpaid. After this confirmation, a request will be sent to send the money directly to you.
Note that although loans are mostly helpful in meeting the financial demands of college, not all students get enough loan money to cover all their financial needs.
Your student loan will be managed by the National Student loan service center (NSLSC) on behalf of the Government. Depending on your condition, you may be required to provide further documentation to the NSLSC to keep or change your loan status.
Throughout your entire study period and while you utilize the student loans, NSLSC will be the point of contact. For a full-time student, the Canadian Government will pay the interest on your Canada student loan while you are still schooling. While for part-time students, you are responsible for paying the interests.
Immediately you graduate, surpass the maximum lifetime limit or leave school, your Canada student loan becomes repayable. The loans that you got during your total study duration will be accumulated in a single repayment schedule.
NSLSC will send a repayment agreement comprising matters like the repayment plan, amount of each payment and the appropriate interest rate.
Full-time students are eligible for six months before the first payment, but interest will begin to accrue during this period. While for the part-time students, the six-months period relates to repayment of the principal loan, not the interest.
To make payments through online banking, you need to add the national student loan center as a payee with your NSLSC account number.
National Student Loan Repayment Assistance
To make repayment easy, the Federal Government provides a repayment assistance plan for students who have problems repaying their Canada student loans.
The assistance plan aims to allow a student to make loan payment that they can afford based on their family size and income. Students who find it challenging to repay their loans will be advised to register for a repayment assistance plan.
Always be on the look-out
To ease your application process, apply for financial support at least some months before you plan on starting school. The possibilities of mistakes or mix-ups are very high but with the space between application, you’ll have time to sort out any issue.
As a student, no money is too much. Several student loan sites will have sections promoting the opportunity to apply for grants and bursaries. It is advisable to also apply for grants you qualify for while you apply for loans. Remember to apply with the right province.
Most importantly, make prompt repayment of your student loans. Failure to do so can have severe financial penalties such as a bad credit rating and a risk of loan default.