New break for Canada Student Loan borrowers
The federal government has announced new measures to help recent post-secondary graduates manage their student debt. In a press release published Sunday, Employment and Social Development Canada revealed that, as of Nov. 1, Canadians wouldn’t have to repay their Canada Student Loan until they’re earning at least $25,000 a year.
Under the Repayment Assistance Plan, students can request help to manage their debt. Depending on their income level and the size of their family, borrowers can apply for reduced monthly payments or no monthly payments at all.
According to the 2016 Budget, the increased eligibility for the Repayment Assistance Plan will provide an additional $131.4 billion in student assistance over five years.
In the release, Employment Minister MaryAnn Mihychuk stated that the country’s future prosperity depended on young Canadians receiving good education and training for the job market.
“As a result of this new measure, students will be better positioned to transition into the workforce after graduation,” Mihychuk said.
The government said this financial relief is in addition to the changes to the Canada Student Grants program enacted on Aug. 1. Under those measures, full-time students from low-income families can receive $2,000 to $3,000 a year in support. Canadians from middle-income families are eligible to receive $800 to $1,200 a year and part-time student from low-income families can receive $1,200 to $1,800 in financial aid. The Canada Student Grant amounts have been increased by 50 per cent according to the release.
From 2013 to 2014, approximately 750,000 students were repaying Canada Student Loans according to the government. Of those 750,000 borrowers, roughly 234,000 of them benefited from the Repayment Assistance Plan.
Students struggling with the burden of debt are encouraged to contact the National Student Loans Service Centre to learn more about what financial assistance options are available to them.