Canadian Student Loan Interest Relief

Student Loan Interest Relief

Canadian students are lucky to have a fantastic monetary tool at their disposal.  It is called Interest Relief and it is designed to help you during periods of low income or unemployment.  Lets face it, if you have a Government Loan, they want you to pay it back.  In fact, as a taxpayer, so do I!  To ensure that this takes place you can apply for relief.  What does this relief entail? 

During periods of Interest Relief:

• You are not required to make payments on either the monthly interest or the outstanding principal of your loan.
• The Government of Canada and/or the Government of your province or territory will pay the interest on your loans for you.
• Any voluntary payments (full or partial) you choose to make during periods of Interest Relief will go directly toward reducing your outstanding principal. These payments are not mandatory, and they will not affect your current or future eligibility for Interest Relief.

Extended Interest Relief

If you are still unable to make your payments and it has not been 5 years since you left school, you may be eligible for Extended Interest Relief.

How can you determine if you are eligible?

To be eligible for Interest Relief, all of the following conditions must be met:

• Your monthly gross family income (before deductions) must fall within the maximum income guidelines.
• You must reside in Canada. Note: For the purposes of Interest Relief, if you are participating in an international internship program or if you are a member of the Canadian Armed Forces who is stationed abroad, you are considered to be residing in Canada.
• Your loan must not be in default (that is, not in collection with the Canada Revenue Agency or another collection agency). Note: If you filed for bankruptcy on or after May 11, 2004, you may still qualify for Interest Relief even if your loan is in default.
• You must have signed a Consolidation Agreement for your Canada Student Loans. If you have not signed a Consolidation Agreement, contact the National Student Loans Service Centre and/or your financial institution, to request one. 
• You must meet all eligibility criteria in the month your application is dated.

If you really need some help, I would suggest visiting CanLearn.