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STUDENTS FINANCE

A GUIDE TO FINANCING YOUR POST-SECONDARY EDUCATION

OWNER’S MANUAL 11

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11/12OWNER’S MANUALWhat’s your story? 1

Here’s one quiz you want to pass... 2

How much does it cost? 3

There are lots of ways to pay for your education 4

Just the facts 6

Are you eligible to receive funding? 7

Applying for government student funding 8

Not enough money? 12

Disbursement: Getting your money 13

I’ve got my loan: Now what? 15

Repaying your student loan – Not as hard as you think 16

Leaving school 17

Help during repayment 19

Where to get help 22

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Carla

Carla is a 35-year-old single mother of one child. She’s going back to school to upgrade her education and become a nurse. With one small child, she knows she can’t handle a part-time job plus school work. Because of her circumstances, she will qualify for both federal and provincial government student funding (grants and loans) to fund most of her education.

WHAT’S YOUR STORY

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Carla and Aaron have something in common – they both made informed choices about how they’ll pay for their education. It’s your education and you can choose how to pay for it.

Aaron

Aaron is starting college in two months to study hotel and restaurant management. He found a job for the summer where he’ll make decent money, but not nearly enough to cover all his expenses for the eight months he’s in school. He wants to apply for student funding to cover part of his education and will work part-time through the school year to contribute to his costs. He’ll graduate with only $5,000 in student loans.

Paying for a post-secondary education is an investment in your future. When you’re done, you’ll be in a position to get a better job. Over the long term, you’ll earn back your investment many times over.

This is a book about your options.

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Find out how much you know about student funding. If you don’t have all the answers just yet, this booklet can help you learn more about your options for paying for school.

1. Are You Average? The average Alberta undergraduate student net debt 6 months after graduation for 2009-2010 was:

a) $12,500

b) $19,120

c) $27,800

2. How Much per Month? The monthly payments (over 10 years) on a $20,000 student loan are about:

a) $150 per month

b) $200 per month

c) $450 per month

3. Independence Day. I am a single student and am considered to be independent. My parent’s income does not affect my student funding when:

a) I have to move to a different city than my parents live in to go to school.

b) I move out of their house and get my own apartment.

c) I have been out of high school for four years or have been available for full-time work for two years.

HERE’S ONE QUIZ YOU WANT TO PASS...

4. All In a Day’s Work. If I work part-time during school:

a) Every cent of income I earn is calculated in my eligibility for student funding.

b) All of my income over $800 per month is used to calculate my eligibility for student funding.

c) I don’t have to declare part-time income, as long as I’m a full-time student.

5. Freedom from Interest. My student loans stay interest free as long as:

a) I am a student.

b) I am a full-time student.

c) I am a full-time student and my enrolment as a full-time student has been confirmed to EDULINX and the National Student Loans Service Centre.

6. Are All Loans Created Equal? Student loans differ from regular loans from banks because:

a) Government student loans are in interest free status while I’m a full-time student.

b) Government student loans are calculated and awarded based on my need, not my ability to pay them back.

c) All of the above.

(Answers: 1. B; 2. B; 3. C; 4. B; 5. C; 6.C)

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How much will it cost you to get the education you want? That depends on a number of factors, including:

• the location of your post-secondary institution,

• what kind of post-secondary institution you attend,

• how long your program lasts, and the living expenses you have while you’re there.

The chart below shows the typical ranges of costs for one year of post-secondary education, including the cost of living. These estimates are for single students – if you are married/common law or have children, you’ll have higher expenses.

HOW MUCH DOES IT COST?

» Estimated Cost per Academic Year

Living with parents

$7,000 - $9,000

Living independently

$12,000 - $14,000

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If you’re like most people, you’ll use several sources to pay for your education – family contributions, summer and part-time jobs, scholarships and maybe student loans and grants. Most have advantages and drawbacks so it’s up to you to look over all of the options before you decide on the best financing mix for you.

THERE ARE LOTS OF WAYS TO PAY FOR YOUR EDUCATION

Options What to think about

Savings: from jobs, birthday presents, investments, anything

• The money you have is always a good place to start.

Family Contributions: What can your parents or spouse/partner contribute? Some families use investment programs like Registered Education Savings Plans to save for their children’s education.

• Your parents or spouse/partner may be expected to contribute to the cost of your post-secondary education.

Jobs: Employment when you aren’t in school and part-time jobs when you are.

• You’ll make money and pick up valuable work experience.

Government Sponsored Student Loans: Both the federal and provincial governments provide loans to qualifying students.

• You don’t have to make any payments on student loans while you’re in school, but they do have to be repaid when you finish.

• Financial assistance is awarded based on your need and resources. You may not qualify if you or your family has a high income or other resources.

Provincial Government Grants: You may be eligible for provincial grants in addition to loans.

• You may be eligible to receive up to $3,000 per semester (a period of one to four months) in Maintenance Grants.

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Options What to think about

Federal Government Grants: You may be eligible for Canada Student Grants.

• Students from Low-Income Families• Students from Middle Income Families• Students with Dependants

• For Persons with Permanent Disabilities

• For Services and Equipment for Persons with Permanent Disabilities

If you qualify for a federal student loan and meet the specific grant eligibility requirements you will receive:

• $250 per month of study• $100 per month of study• $200 per month of study for each child under 12

years of age (at the beginning of the school year). If you have a child 12 years of age or older who has a permanent disability (a permanent physical or mental impairment that results in your child requiring daily care), you will also receive this grant.

• $2,000 per loan year to help meet your education and living costs due to your permanent disability

• Up to $8,000 per loan year for exceptional education related costs due to your permanent disability

Scholarships and Bursaries: Scholarships are usually awarded for good grades or in recognition of other achievements, while bursaries are usually awarded based on financial need although other accomplishments may be considered.

• Search for over 450 scholarships, grants, bursaries and awards on the Scholarship Connections database.

Co-op/Applied Degree Programs: These programs alternate between school terms and paid work placement terms.

• These programs let you gain valuable work experience in your field and earn money.

Student Line of Credit from Banks: These may be an alternative if you don’t qualify for a government sponsored student loan.

• If you don’t have a job or a credit history, you may need someone who does to co-sign the loan.

• You usually have to make interest payments on these loans while you’re in school.

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Government sponsored student funding is a common source of post-secondary financing. Here’s what you need to know.

» What financial assistance does the government offer students?

The government offers:

• government student loans, which have to be repaid when you leave full-time studies,

• government grants, which are given to students with high financial need or special circumstances

» What is a government student loan?

Government student loans are special loans to help cover the costs of education. There are Canada student loans sponsored by the federal government and Alberta student loans sponsored by the provincial government. Most people with student loans have both.

» When do I repay a government student loan?

While you are a full-time student, you do not have to make any payments on your student loans. After you leave full-time studies (whether you graduate or not) you have six months before you have to start repaying your loan. However, interest will start to accumulate on the outstanding balance of your Alberta and Canada student loans the month after you complete your studies.

JUST THE FACTS

» What are government grants?Your student funding application is automatically assessed for a number of federal and provincial government grants. Grants usually don’t have to be repaid unless you withdraw from studies or your eligibility changes.

Canada Student GrantsThe federal government offers Canada Student Grants for students from low-income families, students from middle-income families, students with dependants and students with permanent disabilities. You must qualify for a federal student loan and meet the specific grant eligibility requirements to receive these grants.

Provincial Government GrantsThe provincial government offers Maintenance Grants for students with special circumstances, such as single parents, married/common law students whose spouse/partner cannot work and single students with maintenance payments.

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ARE YOU ELIGIBLE TO RECEIVE FUNDING?

» In order to be eligible to receive full-time loan and grant funding, you must:

• be a resident of Alberta

- If you are an independent student (see Tip), you are considered to be a resident of Alberta if:

» Alberta is the last province you have lived in for 12 consecutive months while not a full-time post-secondary student, or

» You are attending school in Alberta and have never lived in any Canadian province for 12 months in a row.

- If you are a dependent student (see Tip), you are considered to be a resident of Alberta if:

» Your parent(s) live in Alberta

• have financial need for funding

• be enrolled as a full-time student taking a minimum 60% of a full course load (40% of a full course load if you are a student with a permanent disability)

• be sure your program and institution has been approved by Alberta

> TIP:AmIan“independent”or“dependent”student?

Youareconsideredtobeanindependentstudentif:

• Youareover22yearsold,or

• Youhavebeenoutofhighschoolformorethan4years,or

• Youhavebeenavailableforfull-timeworkfortwoormoreyearssinceyoulefthighschool,or

• Youaremarriedorcommonlaw,or

• Youaredivorced,separated,orwidowed,or

• Youaresinglewithdependentchildren

Otherwise,youareconsideredtobeadependentstudentand:

• YoushouldapplyforfundingfromAlbertaifyourparent(s)liveinAlbertaevenifyouarenotstudyinginAlberta

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If you’re applying for student funding, here’s some basic information you need to know.

» Where to applyTo apply for student funding, you can:

• Apply online! Use the secure online student funding application available at alis.alberta.ca/apply. It is quick and easy to use. You may even see your results immediately.

• If you are not able to apply online, you can pick up a paper application from the financial aid office at your school or from your nearest Alberta Service Centre or Canada-Alberta Service Centre.

You only need to submit one application to apply for funding from both the Alberta and Canada Student Loan Programs.

» When to applyApply for assistance as early as possible so that you can find out how much money you are eligible to receive. This will help you plan for the year. As soon as you know what school you plan to attend, you can apply at any time.

APPLYING FOR GOVERNMENT STUDENT FUNDING

> Howmuch?

Theformulathatdecidestheestimatedamountofstudentfundingyougetissimple:

Yourallowableexpenses–yourresources=yourassistance(loans+grants)

» How much money can I get?Your application tells the government your education expenses and your resources (the amount of money you have). Your student funding (loans and grants) is intended to help cover the difference between allowable expenses and your resources.

You may not have exact numbers when you fill out your application. For example, you may not know exactly how much you will make at a summer job, so give your best estimate. If you need to change your estimate later, notify Students Finance so your funding amount can be reviewed.

All applications can be audited. If you have provided false information, or if you have failed to provide requested information, your loans and grants can be taken away and you may face legal penalties.

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» How to calculate the money you need

Basic cost of livingNot all costs are covered by government student funding. There is a standard budget for basic monthly living costs used by Students Finance to assess your application. If your basic monthly living costs are higher than these amounts, tell us about your special circumstances to justify your higher costs. You must submit your receipts. > Studentsareexpectedtoinvestintheir

educationbymakingacontributiontowardstheirupfrontcosts.Yourparentsorspouse/partnermayalsoberequiredtocontribute.

Tuition and other mandatory feesYour school will be able to tell you how much your tuition and student fees will be for your school year.

Books, supplies and instrumentsYour faculty or program should be able to tell you the approximate cost of these items.

Monthly child care costs for children under 12 years of age• Allowable child care cost is $75 per month

per child without receipts

• Actual child care costs after subsidy may be considered with receipts up to a maximum of $530 per month per child.

Note: If you are a single student, you are expected to live with your parents if they live in the same city as your school unless you’ve been out of high school for four years or more, or you have been available to work full-time for at least two years.

> *Dependentchildrenmeansthosechildrenwhoarelivingwithyouandforwhomyouand/oryourspouse/partnerarelegallyresponsible.

Carlos

Carlos, 18, is going to university to become an architect. Before he started drawing buildings, he prepared a budget. He had $2,000 in the bank from a part-time job during high school and another $1,500 from his summer job. His parents had also saved $2,000 for his education.

Next he figured out his expenses. He had his tuition and books covered, but no other money for the eight months of school. Since he’s living at home, his living expenses are low. He has applied for several scholarships but if he doesn’t get one, he’ll apply for student funding. Since his parents have low income, he will probably qualify for student loans and grants.

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Your household statusMonthly

Total

No dependent children

Single and living with parent(s) $432

Single and living independently $941

Married/Common law $2,004

Separated/Divorced/Widowed $941

With dependent children*

Single: 1 child $1,710

Single: 2 children $2,159

Single: 3 children $2,608

Married/Common Law: 1 child $2,453

Married/Common Law: 2 children $2,902

Married/Common Law: 3 children $3,351

Separated/Divorced/Widowed: 1 child $1,710

Separated/Divorced/Widowed: 2 children $2,159

Separated/Divorced/Widowed: 3 children $2,608

Each additional child add $449

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» How to calculate the resources you have

All of these things are combined to determine your resources.

Personal ContributionsYou are expected to contribute a minimum amount based on the number of months you are available to work before starting school:

• 2 months: $720

• 3 months: $1,080

• 4 months: $1,350

Parental ContributionsYour parents are expected to help pay for your education unless you’ve been out of high school for four years or more, or you have been available to work full-time for at least two years. Their expected contribution is based on their resources and the number of people in your family. Your parents may have saved money for you in a Registered Education Savings Plan and Canada Scholarship Trust Fund.

Spousal/Partner ContributionIf you are married or common law, your spouse’s/partner’s income must be reported on your application. Your student funding will be based on your combined expenses and resources. An $800 per month exemption from your spouse’s/partner’s earnings will be calculated automatically.

Part-time earnings

You must enter the full amount of your net part-time earnings while in school. An $800 per month exemption will be calculated automatically.

Mikko

Mikko, 25, is from a small town in northern Alberta. She decided to move to Edmonton to continue her education. After high school, she worked for four years and saved $12,000, so she did not qualify for student funding in her first year of school.

By her second year, her savings were used up and she financed the rest of her education with a combination of student loans and grants, income from a summer job and help from her family.

Scholarships, bursaries, fellowshipsReport any scholarships, bursaries or fellowships on your application. These awards do not affect your eligibility for Alberta student funding but are used to calculate your eligibility for federal funding (an $1,800 exemption is applied).

AssistantshipsEnter the full amount of your assistantships. An $800 per month exemption will be calculated automatically.

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> Remember

YoumustreportALLofyourincome,includingincomefromsummerjobs,part-timejobs,investmentincome,andsoon.Youmaynotknowyouractualincomewhenyoufillinyourapplicationbutgiveyourbestestimate.Ifyouneedtoadjustyourestimatelateron,youmustletStudentsFinanceknow.

All applications are subject to audit.Ifyouhaveprovidedfalseormisleadinginformation,orifyouhavefailedtoproviderequestedinformation,yourloansandgrantsmayhavetoberepaidandyoumayfacelegalpenalties.Keepallofyourdocumentsrelatedtoyourcostsandresources.

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• If you and your spouse/partner are both attending full-time, the following formula is used by Students Finance to determine the expected contribution amount from your combined assets:

a) If Total Combined Assets is $ $4,000 or less:

b) If Total Combined Assets exceeds $4,000:

Other Income

You must show any other government support you receive, such as disability benefits or children’s benefits on your application. Do not include Child Tax Benefits, GST Credits, Income Tax Refund or Registered Disability Savings Plan.

RRSPsIf you have RRSPs, a $2,000 exemption is applied for each year you’ve been out of high school. If you cash in an RRSP, the money is considered to be a resource and is used in your calculation for student funding.

Assets (including spouse/partner assets)You must declare other assets. These include:

• Term deposits, bonds, stocks, GIC’s, etc.

• RRSP’s purchased during post-secondary studies

• The full value of all other assets

> RRSPTip

IfyouhaveRRSPs,youcanwithdrawupto$10,000peryeartoamaximum$20,000withoutpenaltytohelppayforyoureducation–youhave10yearsafteryouleaveschooltoreplacethem.

• Students Finance expects that you will use your assets to help pay for your educational costs. If the value of your assets is $2,000 or less, the actual value will be used to determine your expected contribution amount. If the value of your assets is greater than $2,000, the following formula is used:

$2,000 +Total Assets - $2,000

Number of years remaining in your program

Total Combined Assets ÷ 2

Number of years remainingin your program

Total Combined Assets

2

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» If your situation has changed, a funding review might be the solution to the puzzle.

Do you feel your student funding isn’t enough to cover the costs of your education and living expenses? Has the information on your application changed? You can request a review of your assessment by submitting a Change of Circumstance (COC) Form. Remember, the Alberta student funding program covers only basic living and education costs. You are responsible for paying your other expenses.

» Your assessment will not be reviewed if:

• You are a dependent student, able to live your parents but choose to rent an apartment instead

• You are a single student and choose not to share accommodation

• You need money to make car payments or payments on credit cards

• You need money for expenses that happened when you were not in school

If you are not satisfied with the results of your review, you may appeal again and request a meeting with the Student Financial Assistance Appeal Committee.

NOT ENOUGH MONEY?

» Your assessment will be reviewed if:

• You made an error on your original application (for example, you entered the wrong amount for tuition and book costs)

• You decided to take an extra course at school

• You lost your part-time job

• Your family’s income has been reduced

• Your tuition and book costs are higher than you expected

• Your rent or mortgage payments have increased (keep your receipts)

• You have higher than expected utility costs (keep your receipts)

• Your travel costs are high because you are commuting from out-of-town

• You have unexpected medical costs (keep your receipts or doctor’s note)

• Your spouse/partner has student loan payments (you need a letter from the lending institution with payment details)

• You have child support payments (you need documentation)

• Your marital status changed

• The number of your dependants changed

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So, you’ve filled out your application. What happens next?

DISBURSEMENT: GETTING YOUR MONEY

Q: Will money be sent directly to my school?

A: Yes, if your educational institution requested that tuition fees be paid directly to them from your loan disbursement amount.

• Go to canlearn.ca to find out the amount of your Canada student loan that has been paid to the school.

• Go to edulinx.ca to find out the amount of your Alberta student loan that has been paid to the school.

If you disagree with the tuition amount that your school has requested be sent to them, you must negotiate with them directly.

> TIP:YourstudentfundingcanonlybedepositedintoaCanadianbankaccountwhichyouholdorjointlyhold.

Q: How much will I get?

A: After your application is processed, you will receive a Notice of Assessment in the mail telling you the amount of student funding you will receive. If you applied for funding online, you will see the estimated amount of funding you are eligible for immediately. You may be able to check the status of your application on alis.alberta.ca/apply.

Q: How do I get my money?

A: Your student funding will be either direct deposited into your bank account, mailed to you or sent directly to your school.

For Canada Student LoansIf you provide your banking information on the loan certificate, the National Student Loans Service Centre will deposit your funds into your bank account. Your institution may have to sign your loan certificate confirming your enrollment.

If you do not provide your banking information, a cheque will be mailed to you approximately two weeks before the disbursement date on your certificate.

For Alberta Student LoansWhen you qualify to receive your first Alberta student loan, you will receive an Alberta Student Loan Agreement in the mail about two weeks before the disbursement date on your agreement. Your institution may have to sign your loan agreement confirming your enrollment.

Once you cash your first agreement, any future Alberta student loans may be automatically deposited into your bank account or mailed to you as a cheque.

Q: How will I know when I get my money?

A: There are three ways to find out when your loan money is paid:

1. Visit the “Recent Disbursement” page at edulinx.ca to find out when and how much of your Alberta student loan was sent to you and/or your school. Visit the National Student Loans Service Centre: On-line Services at canlearn.ca to find out when and how much of your Canada student loan was sent to you and/or your school.

2. A Letter from EDULINX sent each time you are paid Alberta student loans (automatically direct deposited into your bank account or by cheque). A letter from the National Student Loans Service Centre sent each time you are paid Canada student loans.

3. The Notice of Assessment you receive after you applied for funding. It shows you when your loan amounts will be paid.

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» EDULINX On-line ServicesEDULINX has a secure, self-serve website that allows you to access and view information on your direct Alberta student loans only.

This website at edulinx.ca allows you to:

• complete online Entrance and Exit Counselling sessions to learn about your student loan responsibilities

• update your personal and contact information

• determine if your current cashed Alberta student loan funds have been either:

- deposited into your bank account, or

- mailed to you as a cheque

• review your direct Alberta student loan account and balance

• complete online Revision of Terms; change your payment amount, payment term, payment date

• print off and mail in a Pre-Authorized Payment Form

• complete a one-time lump sum payment if you are participating in the pre-authorized payment plan

• review your current account statements online at any time

• benefit from an enhanced personal messaging centre that reminds you about key dates in the life of your student loan

• obtain your previously cashed Alberta student loan agreement/certificate numbers from your student profile

If you have any questions regarding this website, contact the EDULINX On-Line Services Help Line at 1-866-852-5629 or visit edulinx.ca

» Where do my loans get cashed?

Alberta student loans:EDULINX

• Toll free: 1-866-827-0310 Monday to Friday, 7:30 am to 8:30 pm your local time (within North America)

• TTY: 1-866-587-1853 (for the hearing impaired)

• Countries outside of North America: dial international access code + 800 2 529-9242

• Countries outside of North America without an international access code: call collect at 905-306-2995

• edulinx.ca

Canada student loans:National Student Loans Service Centre

• Toll free: 1-888-815-4514 (within North America)

• TTY: 1-888-815-4556

• Countries outside of North America: dial international access code + 800 2 225-2501 (toll free)

• Countries outside of North America without an international access code: call the Canadian operator at 800 0800 096 0634, then call collect 905-306-2950

• canlearn.ca

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Tests. Papers. Studying. Social events. Family responsibilities. As a student, you’ve got a lot on your mind, and worrying about payments on your student loan shouldn’t be part of it. That’s why, while you’re a full-time student, your loan is in interest-free status.

That being said, there are still a couple of items that you’ll have to deal with.

» There are forms…If you’re a full-time student with previous loans and you are not getting another loan this year, you have to fill out one form to keep your loans interest free.

• Complete Schedule 2 if you only have a previous Canada student loan

• Complete Form B if you only have a previous Alberta student loan

• Complete Form B if you have both previous Canada and Alberta student loans

You can get both forms at your school’s financial aid office.

» If you move…Every time you move, it’s absolutely critical that you give your change of address to:

• EDULINX

• National Student Loans Service Centre

• Students Finance

• Your school

Otherwise, there’s a good chance you’ll miss out on important information regarding your loan payments and responsibilities.

I’VE GOT MY LOAN: NOW WHAT?

> Threeprogramstohelpyou…

Parentalleave

Ifyoutakeabreakfromfull-timestudiesforparentalleave,youmayapplyforinterest-freestatusonyourAlbertastudentloans.

Medicalresidents

Ifyouarecompletingmedicalresidencytraining,youmayapplyforinterest-freestatusonyourAlbertastudentloans,andyouwillnotberequiredtomakepayments.

CanadianForcesReservists

IfyouareaCanadianForcesReservistwhohasinterruptedfull-timestudiestoserveondesignatedoperations,youmaynolongerberequiredtopayinterestormakepaymentsonyourCanadaandAlbertastudentloans.

If you borrow money, here’s the bottom line when it comes time to pay it back.

Size of Student Loan $10,000 $15,000 $25,000

Monthly payment* (for 5 yrs) $180 $270 $450

Interest paid over 5 yrs $781 $1,172 $1,953

Monthly payment* (for 10 yrs) $97 $145 $241

Interest paid over 10 yrs $1,587 $2,381 $3,968

*Assumes an interest rate of 3 per cent

You have to decide what kind of monthly payments you can handle and how long you take to pay back the whole thing. Here’s how two students handled their loan repayment.

REPAYING YOUR STUDENT LOAN – NOT AS HARD AS YOU THINK

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IDConnie

Connie got a great job right after graduation working as a registered nurse. With a starting salary of $60,000 per year, she thought she had it made. She rented a great apartment and leased a brand new sport utility vehicle. After working hard at school, she was ready to enjoy the good life. Rent, car payments and her student loan payment left her with almost no disposable income. As a result, she decided to make smaller monthly student loan payments over a longer period of time, even though, over the long term, she’ll end up paying more interest on her loan.

Rachid

After graduation, Rachid took a position in his field, but with a lower salary than he hoped for at $45,000 a year. His first priority after graduation was to pay off his $9,500 student loan, so he chose to continue living with three roommates to keep his expenses down. Rachid stuck to his budget, made payments of $330 each month on his student loan and paid it off in 2 1/2 years.

» The six most important months of your loan

Once you leave full-time studies – whether or not you graduate – you have six months before you have to starting paying back your loans. However, interest starts to accumulate on the outstanding balance of your Alberta and Canada student loans the month after you complete your studies.

» Who do I pay?You may have received loans from both the federal and provincial governments even though you applied using one application. This means you may have to make separate payments to:

• EDULINX, student loan service provider for your Alberta student loans, and

• National Student Loans Service Centre, student loan service provider for your Canada student loans

» What if I received student loans from a bank?

If you received Alberta and/or Canada student loans from a bank, remember that these loans stay with and are repaid to the bank holding your loans.

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» After you leave school – your terms or theirs

If you have Alberta student loans, you will be sent a standard repayment letter with details about your repayment term and interest rate. You must contact EDULINX if you want to change your repayment terms.

If you have Canada student loans, you will be sent a standard consolidation agreement with details about your repayment term and interest rate that you must sign and return. You must contact the National Student Loans Service Centre if you want to change your repayment terms.

It’s for information like this that it’s crucial that EDULINX and the National Student Loans Service Centre have your current address. Ignoring your student loan until you’re ready to deal with it is not a good option.

LEAVING SCHOOL

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Justin

While Justin was in his third year of post-secondary studies, he received an unexpected gift of money from a relative to help pay for his studies. Once his application was reassessed, it was determined that Justin received an Alberta grant for which he was no longer eligible. Once Justin completed his studies, he chose to convert his Alberta grant overpayment into a loan by adding it to the balance of his existing Alberta student loan.

» What if I have an Alberta grant overpayment?

If you received more Alberta grant funding than you were eligible for, you are responsible for paying back your overpayment in full. You can repay your overpayment anytime within the first 9 months after the end of your studies without having to pay interest. You can also convert your Alberta grant overpayment into an Alberta student loan by adding it to the balance of your existing Alberta student loan, or by creating a new student loan if you don’t already have one.

» Amortization period (Term)This is the length of time in months that you plan to take to pay off your loans. The longer your term, the smaller those payments will be, but the more interest you will pay in the end.

» Interest rateYou can choose either a floating or a fixed interest rate.

• A floating rate changes throughout your repayment period as the prime rate changes. The floating interest rate on Alberta student loans is the prime rate.

• A fixed rate remains the same throughout your repayment period. The fixed interest rate on Alberta student loans is the prime rate plus 2%.

For information about interest rates on your Canada student loan, visit canlearn.ca.

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Chances are you aren’t the first person having trouble and you won’t be the last.

It would be great if you got a good job and lived happily ever after when you graduated. Sometimes it doesn’t happen that way. Sometimes people just can’t make loan payments. If you’re having trouble, there is repayment assistance to help you get through the rough spots.

» Repayment Assistance Plan (RAP)

What is RAP?The Repayment Assistance Plan is offered for both Canada and Alberta student loans. The plan provides you with short-term assistance if you have temporary financial challenges and long-term support if you have persistent financial challenges. Under RAP:

• you may only have to make a monthly affordable payment that is based on your income and family size

• you may not have to make any monthly payments if your income is low

• your repayment period will not last more than 15 years after you stop being a student (and not more than 10 years if you are a borrower with a permanent disability)

HELP DURING REPAYMENT

How do I apply for RAP?You can apply for RAP at any time during your repayment term. If you are approved for RAP on your Canada student loans, you are automatically approved for RAP on your Alberta student loans. Here’s how it works:

• If you have both Alberta and Canada student loans, you will submit only one application to the National Student Loans Service Centre (NSLSC). The NSLSC processes the application for RAP on your Canada student loans and then forwards the application to EDULINX who processes the application for RAP on your Alberta student loans

• If you have only Alberta student loans, you will submit your application only to EDULINX

• RAP is approved for a six month period. If you want to continue to receive RAP, you must submit a new application every six months

What are the eligibility requirements for RAP?To be eligible for RAP:

• your loan must be in repayment status

• you must meet the financial eligibility requirements for RAP

• your loan must be in good standing with EDULINX, the NSLSC and/or your bank

• your loan must not have been included in a bankruptcy

• you must not have missed previous RAP payments

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RAP information for borrowers with a permanent disabilityIf you have a permanent disability, you will be considered for RAP-PD (Repayment Assistance Plan for Borrowers with a Permanent Disability). Under RAP-PD:

• You must meet the basic RAP eligibility requirements

• If you received disability grants as a student, you are automatically considered for RAP-PD

• If you did not receive disability grants as a student, you will have to provide proof of your permanent disability by providing appropriate documentation from your doctor and proof of income

• Your additional living costs due to your permanent disability may be considered in your application

» Revision of TermsIf you’re having trouble making your Alberta and/or Canada student loan payments, you can revise the terms of your loan so that you can make smaller monthly payments over a longer period of time.

Of course, you can also do the reverse and make higher monthly payments to pay off your loan faster.

If you decide to change your payment amount, payment term, or payment date of your Alberta student loan, go online to edulinx.ca or talk to EDULINX. If you decide to change the repayment terms of your Canada student loan, go online to canlearn.ca or call the National Student Loans Service Centre. If your loans are with a bank, contact them directly.

Lliam

Lliam graduated with a diploma in computer programming, and a $12,000 student loan. He found a job shortly after he graduated and never missed a payment on his loan for the first two years. Then Lliam was laid off and it became impossible for him to keep up with his payments. Instead of missing a payment, which would reflect on his credit rating, he applied for RAP. Because of his low income, Lliam did not have to make any payments on his Canada or Alberta student loans for six months. Now he has some breathing room to find a new job without worrying about loan payments.

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> TIP:Ifyouhavemissedpayments,youcanbringyourloanintogoodstandingbyapplyingforRAPbecauseRAPcanbebackdateduptosixmonths(6)and/orinterestcanbecapitalizeduptothree(3)months.

Start off on the right footPaying back a student loan is very straight forward. It’s in your best interest to pay back your loan successfully and there’s lots of help for you to do so. You need to know that there are consequences if you do miss payments on your loan:

• If you don’t make your student loan payments, the payment default will show up on your personal credit rating.

• If you declare bankruptcy, your student loan debt is included in your bankruptcy but will not be discharged with your other debts. This means you have to pay back your student loan debt. However, you may request a court ordered discharge once seven years have passed since you left school and, in the case of exceptional financial hardship, five years.

If you have trouble during repayment, contact EDULINX and the National Student Loans Service Centre to find out about programs to help you.

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Asastudent,youmayqualifyforanumberoftaxcreditsanddeductions.Taxrulesandregulationschangeallthetime.Relyontheup-to-dateinformationyoureceivefromCanadaRevenueAgencyorfromataxprofessional.

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Vera

When Vera graduated, she needed to review her budget. She negotiated to pay back her $16,500 student loan over five years, resulting in payments of about $297 a month. After struggling to make these payments for six months, she approached EDULINX and the National Student Loans Service Centre and negotiated a revision of terms to stretch the loan payments out over 10 years and make them more manageable.

Looking backIt’s impossible to put a value on your education. The higher your level of education, the higher your income is likely to be throughout your life. You increase your circle of friends. You have new experiences, and gain a new appreciation of old ones.

Managing your finances is an important part of the process. Your finances affect your life every bit as much as your grades. To successfully apply for loans or credit in the future to make major purchases such as homes or vehicles, depends on the credit rating you establish now by keeping your student loan payments up-to-date. While you’re studying your books, don’t forget to study your options. It pays. Literally.

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Yes, you’ll have questions, but you’ll also meet lots of people who can help.

» Provincial governmentThe Government of Alberta awards about 40% of student loans and offers grants for students with high financial need. It calculates your eligibility for student funding and offers programs to help you when it comes time to pay back your loan.

Find out more by:

• checking out alis.alberta.ca/studentsfinance

• calling the Student Funding Contact Centre in Edmonton at 780-427-3722 or toll free in Canada at 1-800-222-6485

• e-mailing the Student Funding Contact Centre using the secure e-Contact service

• visiting the Alberta Service Centre or Canada-Alberta Service Centre nearest you

Alberta student loans are processed through EDULINX, Alberta’s student loan service provider.

For complete information about your student loan, complete the Entrance and Exit Counselling sessions on the EDULINX website.

Contact EDULINX at:

• 1-866-827-0310 Monday to Friday, 7:30 am to 8:30 pm your local time

• edulinx.ca

WHERE TO GET HELP

» Federal governmentThe Government of Canada awards about 60% of student loans and gives Canada Student Grants to high-need students with special circumstances. It has programs to help you manage and repay your Canada student loan.

Canada student loans are processed through the National Student Loans Service Centre.

Contact them at:

• 1-888-815-4514

• canlearn.ca

» Your bankIf you received an Alberta and/or Canada student loan from a bank, your loan remains with and is repaid to the bank holding your loan.

» Your schoolMost post-secondary schools have a financial aid office where you can get information, advice and help dealing with your student loan, awards or other financial issues.

> WhatifIhaveSpecialCircumstances?

Studentsaren’tone-size-fits-all.Ifyouhavespecialcircumstances,getadviceaboutyoursituationbyvisitingthefinancialaidofficeatyourschool,bycallingtheStudentFundingContactCentreinEdmontonat780-427-3722ortollfreeinCanadaat1-800-222-6485,orbyvisitinganAlbertaServiceCentreortheCanada-AlbertaServiceCentrenearestyou.