It's time to start repaying your loan when you:

• have graduated from your studies
• have transferred to part-time studies
• have dropped your studies altogether
• are taking time off school for more than 6 months, or
• have reached your lifetime limit for financial assistance.

With most government student loan programs, you have at least 6 months after your post-secondary studies before you have to start paying back your loan, although interest does accumulate during this period. This 6 month grace period is meant to give you enough time to find a job and start making money.

But be aware that most programs start charging you interest as soon as you finish school. You can either choose to:

• start making those interest payments right away,
• pay the six months of interest as a lump sum before you start making your regular payments, or
• have your loan providers add the interest amount to your loan total after the 6-month grace period.

Check with your loan provider(s) to learn the rules of your loan program(s).

It's your responsibility to contact your loan provider(s) to set up a repayment schedule before your 6-month grace period is up. Loan providers normally try to contact you via mail or phone, but you are in charge of setting up and managing your loan payments should they not be able to reach you.

If you don't make contact, your loan payments may start to be automatically withdrawn from the same bank account where your loans were deposited (if you had arranged for direct deposits). If you don’t have money in that account, you may accidentally go into default, which could affect your credit rating for years.

Lifetime limits on student financial assistance

There are lifetime limits on the student financial assistance you can receive. Student financial assistance includes both loans and the interest-free status of your loans. Once a lifetime limit has been reached, your loans will no longer be interest-free and you will have to start paying back your loan principal, as well as the applicable interest. This rule applies even if you are still in school.

Lifetime limits for Canada Student Loans vary:

• full-time students who meet the eligibility criteria on or after August 1, 1995 are eligible to receive student financial assistance for a maximum of 340 weeks
• full-time students enrolled in doctoral studies are eligible to receive student financial assistance for a maximum of 400 weeks
• students with a permanent disability and those who received Canada Student Loans before August 1, 1995 are eligible to receive student financial assistance for a maximum of 520 weeks.

Once you reach the lifetime limit for financial assistance, your first payment becomes due 6 months after the last in-study period during which you received your final loan or period of interest-free status.