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Government Sponsored Student Loans Repayment Seminar. Agenda. In Study Payment Examples How to be Debt Free Faster Debt Management Options. Government Sponsored Student Loans . Interest is paid by Government while you are a full-time student
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Agenda • In Study • Payment Examples • How to be Debt Free Faster • Debt Management Options
Government Sponsored Student Loans • Interest is paid by Government while you are a full-time student • Repayment begins 7 months after your End of Study date • If you return to school full-time you need to notify your Loan Servicer • This “Grace Period” is not interest free in all programs
Repayment • “Consolidation” occurs the first day of the seventh month after End of Study Date • e.g. EOSD April 30th --> Consolidation November 1st • You must sign and return the Consolidation Agreement • Depending on when you received your loans, you may have loans with more than one loan servicer. • Separate payments are required for each loan
Payment Examples • your monthly payment is determined by the principal balance plus any accrued interest plus the interest rate over the term • information for illustration purposes only, your loan servicer will calculate your repayment schedule
How much interest will I pay? • your monthly payment is determined by the principal balance plus any accrued interest plus the interest rate over the term • information for illustration purposes only, your loan servicer will calculate your repayment schedule
Payment Comparisons • your monthly payment is determined by the principal balance plus any accrued interest plus the interest rate over the term • information for illustration purposes only, your loan servicer will calculate your repayment schedule
How Can I Be Debt-Free Faster? • Repaying your loan quickly will incur the least interest • Options to consider as your finances permit: • Request an amount larger than the minimum calculated for the term • Request Weekly or Bi-Weekly payments • Make an annual lump sum • Increase the monthly amount by $10, or $25 or $100 in each year • Pay your loan in full at any time without penalty
Debt Management Tools • Contact your loan servicer immediately if you foresee financial difficulties • Check out these government programs: • Interest relief • Revision of Terms • Debt reduction • Loan Remission or Forgiveness
Interest Relief • Debt management tool offered by all programs • Approval based on family income, family size and payment level • Once approved: • No payments required • Government pays the interest • Contact loan servicer to apply prior to missing payments
Revision of Terms • Changes the term and your monthly payment based on financial situation • Options: • extending the term to maximum • interest only payments • re-amortization after lump sum payments • Payments are required each month based on the Revision of Terms agreement
Debt Reduction in Repayment • Eligibility: • Must have used at least 30 months of the Interest Relief program • Must be at least 5 years past End of Study Date • Must apply to have your loan principal reduced if your payments exceed a given percentage of your income • Contact your loan servicer to apply
Bankruptcy • Declaring bankruptcy is no longer an option to avoid student loan payments • Federal government regulations will not forgive student loan debt on bankruptcy unless you have been out of school ten years • Check out debt management tools available • Contact your loan servicer to discuss options before missing payments
Managing Your Student Loan • Some Loan Servicers now have on-line services to provide access to information and details of your student loan • You can: • Check the status of your student loan • Check the balance of your loan(s) • Review details of new loans you’ve recently received • Update your Mailing and Permanent Addresses and other contact information on-line • Review your loan payment and transaction history • Receive helpful information about your loan in your Personal Message Centre
Tips from your Loan Servicer • Sign and return the Consolidation Agreement • Maintain contact with your loan servicer • Always keep address up to date • Remember you will have a tax credit in repayment • Contact your loan servicerwith any questions about your file or to change any information
Contacts • For additional information • www.Canlearn.ca • National Student Loans Service Centre – Public Institutions Division 1 888 815- 4514 • CIBC National Student Centre 1 800 563-2422 • Royal Bank Student Centre 1 800 363-3822 • Bank of Nova Scotia 1 888 284-3044