canada student loan forgiveness

Your Guide to Canada Student Loan Forgiveness

Jordann Debt

Student loan debt is a big problem in Canada, and it’s not going away any time soon. The average new graduate is carrying $28,000 in student loan debt. Pair that with high housing costs and low wages, and it’s no surprise that most millennials are putting off major life milestones because they simply can’t afford it.

There is a small glimmer of hope for those struggling with provincial and federal student loans, and it comes in the form of student loan forgiveness. I took advantage of New Brunswick student loan forgiveness when I wiped out $16,000 of my $42,000 in student loan debt. Without that loan forgiveness program and others like it, there’s no way I could have paid off $38,000 in two years.

If you’re one of the many young Canadians dealing with high student loan debt, I’ve put together a list of possible resources for you to tap to reduce your debt burden. Before you jump to your province and start going click happy, there are a few things you should know:

First, most of these programs are only for publicly funded student loans. If you have loans through a private lender, skip to the bottom of this blog post for additional resources.

Second, every province has a repayment assistance program (RAP). A RAP is there if you can’t make your minimum student loan payments. It’s not student loan forgiveness, it’s just there to help you if you are having trouble earning enough money to make your minimum payments. I’ve listed a few of them below.

Finally, some of these programs are applied to your loan automatically and some aren’t. Read the fine print on every website and mark the due dates on your calendar so you don’t miss out on your chance to reduce your student loans just because you didn’t get your application in quickly enough.

Enjoy!

Federal Canada Student Loan Forgiveness

Canada Repayment Assistance Plan (RAP)

The Canada RAP program is useful for university graduates who are having trouble paying their student loans back. The program makes it easier to manage your student loans by reducing the amount you have to pay each month or eliminating all together.

Canada Student Loan Forgiveness for Doctors and Nurses

If you’re a doctor or a nurse you can qualify for loan forgiveness for your Canada student loans by working in a remote or rural area. If you are a doctor, you could qualify for up to $40,000 in loan forgiveness over five years ($8,000 per year). If you’re a nurse you could qualify for up to $20,000 in Canada student loan forgiveness over five years ($4,000 per year).

British Columbia Student Loan Forgiveness

B.C. Completion Grant

Full-time students who successfully complete a year of studies may have the B.C. portion of their B.C.-Canada student loan debt reduced. There is not need to apply for this grant, you are automatically considered if you have a B.C.-Canada student loan.

B.C. Completion Grant for Graduates

A $500 grant for graduates from an undergraduate program. You must have a B.C. student loan and you must apply within one year of graduation.

B.C. Loan Forgiveness Program

Recent graduates in select in-demand occupations can have their B.C. student loans forgiven by agreeing to work at publicly funded health care facilities in underserved communities in B.C., or working with children in occupations where there is an identified shortage in B.C.

Pacific Leaders Loan Forgiveness Program

This program forgives outstanding B.C. student loan debt at a rate of one third per year. If you continue to work for the B.C. Public Service for three years, your B.C. student loan will be paid off in full.

Alberta Student Loan Forgiveness

Alberta Repayment Assistance Program (RAP)

Similar to the Canada RAP program, the Alberta RAP helps graduates who are struggling to make their monthly payments. This program reduces or eliminates your student loan payments. You have to reapply every six months.

Saskatchewan Student Loan Forgiveness

Saskatchewan Repayment Assistance Program (RAP)

Saskatchewan also has a repayment assistance program if you are having trouble making your monthly payments. This program limits your monthly payments to no more than 20% of your gross income.

Graduate Retention Program

The Graduate Retention Program provides Saskatchewan income tax credits of up to $20,000 for tuition fees paid by graduates who live in Saskatchewan. To be eligible you need to live and file your income tax return in Saskatchewan. The tax credits are non-refundable.

Loan Forgiveness for Nurses and Nurse Practitioners

This program encourages nurses and nurse practitioners to work in rural and remote communities. You can use this program to receive $4,000 per year up to a maximum of $20,000. You must have a Saskatchewan student loan to qualify.

Manitoba Student Loan Forgiveness

Repayment Assistance Program (RAP)

Surprise! Manitoba also has a repayment assistance program.

Ontario Student Loan Forgiveness

OSAP Grants & Bursaries

There are 12 grants and bursaries available to students with Ontario student loans. Most of them only apply to you if you are currently a student. You must have Ontario student loans to qualify.

Quebec Student Loan Forgiveness

Deferred Payment Plan

A version of RAP, the deferred payment plan allows you to pay back your student loans in accordance with your income. The deferred payment plan can be applied to a variety of financial institutions, not just provincial student loans.

Nova Scotia Student Loan Forgiveness

0% Interest on Nova Scotia Student Loans

If you live in Nova Scotia, filed your income tax in Nova Scotia and have Nova Scotia student loans since 2007, you can apply for 0% interest on the provincial portion of your student loans. Your monthly payment will remain the same but 100% of your payment will go to your loan principal.

Nova Scotia Student Loan Forgiveness Program

This program is for Nova Scotia student loans (not federal student loans) issued after August 2015. You must be a Nova Scotia resident obtaining a four-year degree at a Nova Scotia university to qualify. You are automatically assessed for this forgiveness program, which can forgive up to 100% of your Nova Scotia student loan.

Debt Cap Program

The debt cap program applies to students who received Nova Scotia student loans between August 1st, 2011 and July 31st, 2015. Anyone who obtained a four-year undergraduate degree qualifies. You are automatically assessed for this program when you graduate. You could have up to 100% of your Nova Scotia student loans forgiven.

Debt Reduction Program

Anyone who received student loans between August 1, 2003 and July 31, 2008 can apply for Nova Scotia’s debt reduction program. You must have successfully graduated from your degree program to apply.

New Brunswick Student Loan Forgiveness

Timely Completion Benefit

The timely completion benefit is available for students with New Brunswick student loans who graduated from a four-year undergraduate program after August 1, 2009. You must have a total federal and provincial student loan amount totaling more than $32,000 and you must apply within seven months of graduation.

Prince Edward Island Student Loan Forgiveness

PEI Debt Reduction Grant

Receive up to $2,000 per year of study, as long as you take out at least $6,000 per year in student loans. You must have PEI and Canada student loans to qualify and you must apply within 60 days of your last day of class.

Newfoundland Student Loan Forgiveness

Newfoundland and Labrador Debt Reduction Grant

With the elimination of the Newfoundland Student Loan, all financial assistance from the province is in the form of a non-repayable NL Student Grant effective August 1, 2015. If you receive provincial funding after August 1, 2015 you will be automatically assessed for this grant.

This may not be an exhaustive list. If you know of other programs that aren’t listed here, or if any of these programs have expired, I encourage you to email me and let me know so I can keep this list up to date.

If you’ve already applied for all of the grants you qualify for and you still have student loan debt left (as I did), the next step is to pay it off. I encourage you to use my debt repayment spreadsheet to find out how quickly you can pay off your debt.

Most of the programs listed above are only available for federal and provincial student loans. If you have your student loans with a private lender, you won’t be able to use the programs above. If that is the case, consider looking into student loan refinancing as a possible way lower your interest rate and pay off your debt quicker.

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