Canadian Student Loan Options

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The cost of a post-secondary education seems to be increasing every year; fortunately getting a Canadian student loan is a pretty straight forward process through the Government of Canada.

The federal government essentially offers 2 Canadian student loan programs to help with your education costs. They of course don’t just give loans away, you need to demonstrate that you actually require financial assistance.

Every province handles loans differently but you can get all the information you need including application forms from the CanLearn website. Note that Quebec, Nunavut, and the Northwest Territories do not participate in the loan programs but they offer their own financial assistance.

Canada Student Loan Program

The Canada Student Loan Program (CSLP) by far the largest program providing financial assistance to Canadian students. This program is available to both part-time and full-time students and depending on your eligibility, you could receive up to 60% of your tuition in federal loans. The maximum loan amount changes every year so be sure to find out what the cap is when you apply. You begin paying back your loan when you meet any of the following criteria.

  • have graduated from your studies
  • transferred to part-time studies
  • have left school; or
  • are taking time off school for more than 6 months

For the first 6 months after you leaving school, you won’t need to make any payments on your Canadian student loan but interest will accumulate. It’s up to you to contact your loan provider to set up a repayment schedule.

Canadian student loan

Canada Student Grants Program

The Canada Student Grants Program (CSGP) is awarded based on your financial need, but unlike the CSLP, you’re not required to pay them back. When applying for any student financial assistance, you will automatically be assessed for any student grants. If you’re enrolled as a part-time or full-time student at an eligible post secondary institution you may qualify for one of the following 7 grants.

  • for students from low-income families
  • for students from middle-income families
  • for full-time students with dependants
  • for part-time studies
  • for part-time students with dependants
  • for students with permanent disabilities
  • for services and equipment for students with permanent disabilities

It is possible to qualify for more than one of these grants and some schools will even offer you grants to attend.

Studying Abroad

Canadian student loans for studying abroad are available in the form of scholarships, grants and bursaries. Check out the following websites for more information.

Student Lines of Credit

If you need additional funding, all the major banks in Canada offer student lines of credit. Unlike the CSLP you’re required to make interest payments only as soon as you start using the loan. Most of the loans give you a 12 month grace period upon graduation before you need to payback the principal but the monthly interest payments still apply.

Having a line of credit is convenient, but you don’t want to get in the habit of borrowing too much while still in school. The last thing you want is to graduate with massive student debt.

Americans studying in Canada

Americans studying in Canada who require financial assistance can apply through the Federal Student Aid program. The different types of aid available to Americans include Pell grants, work-study programs, loans, and Teaching programs.

About Barry Choi

Barry Choi is a Toronto-based personal finance and travel expert who frequently makes media appearances. His blog Money We Have is one of Canada’s most trusted sources when it comes to money and travel. You can find him on Twitter:@barrychoi

2 Comments

  1. Our Big Fat Wallet on March 25, 2015 at 8:10 AM

    Interesting that only 206 students received funding in Alberta last year, I assumed the number would be higher. I didn’t have any debt while in school but almost everyone I knew had some, and I would consider student debt a rare type of ‘good debt’ in that you’re investing in yourself to eventually earn a higher income and the interest is tax deductible

    • Barry Choi on March 25, 2015 at 8:59 AM

      Our Big Fat Wallet,

      Note that 206 only applies to American students who got finding in Alberta. However you’ll notice it also says BC has 329, Ontario 688 and Canada has 410. So the Canadians numbers don’t exactly add up.

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