How the Canada Student Loans Program can assist post-secondary students if their financial situation changes

Q1. What if I'm unable to save enough money to attend university, college or trade school?

A1. If you need help paying for your full- or part-time post-secondary studies, the Government of Canada offers Canada Student Loans and Grants.

A full-time student may be eligible to receive up to $210 per week of study as a Canada Student Loan. A part-time student may be eligible to receive up to a total of $10,000 as a Canada Student Loan.

All students who apply and qualify for a Canada Student Loan are assessed for most Canada Student Grants, beginning in the 2009-10 school year.

Canada Student Grants provide up-front assistance to students from low- and middle-income families, students with permanent disabilities, and to students with children under 12 years of age. Students who qualify do not pay back this assistance.

Depending on your family income and family size, when you apply for a Canada Student Loan, you may qualify for the Canada Student Grants for students from low-or middle-income families. These new grants will provide, per month of full-time studies, $250 for low-income families and $100 for middle-income families. These grants are available for each year of undergraduate studies, provided you continue to meet the eligibility criteria.

Read more information on loans and the new grants, or use the Student Financial Assistance Estimator.

Q2. I live with my parents and I'm considered to be a dependent student. What if my parents' combined income is significantly reduced this year and they are unable to contribute towards the cost of my education?

A2. As a single dependent student, the Canada Student Loans Program takes into account your parents' income from the previous year when assessing your financial needs. If your parents' income was very low, they may not have to financially contribute to your education.

If your parents' income for the current year is significantly different from the previous year, you may request that this is taken into consideration when assessing your financial needs. Contact your provincial or territorial student financial assistance office for more information.

To better understand how student loans are calculated, you can use the Parental Contribution Calculator to calculate the parental contribution amount.

See more information on new grants and other student financial assistance.

Q3. What if my income is less than expected? Can I get additional funding?

A3. If your or your parents' financial situation changes during the school year, it may be possible to request a reassessment based on your present circumstances.

Please contact your provincial or territorial student financial assistance office for further information.

Q4. How much would my (or my family's) income have to change to allow me a reassessment?

A4. The level of change in income required to allow you a reassessment can vary from one borrower to another, depending on a variety of financial and non-financial factors which are taken into account during the needs assessment.

To get an idea whether a change in your present situation would result in additional assistance or a change in eligibility for a Canada Student Loan and Grant, please refer to the Student Financial Assistance Estimator.

The following two scenarios describe the impact of a 25 per cent reduction in a student's income and a 30 per cent reduction in a family's income.

Scenario 1

Jordan is a single independent student living away from home. Jordan's annual income is $24,000 ($12,000 received from summer work and $12,000 received from work during the study period). His only resource is his employment income, and his total cost for tuition, textbooks, and computer is $8,500.

Several weeks into his school year, Jordan's work hours are cut-back, resulting in a 25 per cent reduction in his annual income. As a result, Jordan would be eligible for an increase of $1,200 in grant assistance, since his Canada Student Grant for Students from Middle-Income Families would be replaced by the Canada Student Grant for Students from Low-Income Families. Grants do not need to be paid back.

The following illustrates the impact of this scenario on Jordan's assessed financial assistance package:

Original Assessment - Potential Canada Student Grant for:
Students from Middle-Income Families: $800
Potential Canada Student Loan: $720
Potential Provincial or Territorial Funding*: $1,000
Total Potential Assistance: $2,520

Reassessment - Potential Canada Student Grant for:
Students from Low-Income Families: $2,000
Potential Canada Student Loan: $2,700
Potential Provincial or Territorial Funding*: $3,120
Total Potential Assistance: $7,820

*Provincial or territorial funding can be in the form of loans and/or grants, depending on your province or territory of permanent residence.

Scenario 2

Anna is a dependent student living at home with her parents and younger brother. The combined income of her parents is $48,000 per year, and Anna's income during the pre-study period was $4,000. Her total cost for tuition, textbooks, and computer-related items is $8,500.

Halfway into the school year one of her parents is laid off, resulting in a 30 per cent reduction in household income. As a result, her Canada Student Grant for Students from Middle-Income Families would be replaced by the Canada Student Grant for Students from Low-Income Families.

Although her total amount of eligible assistance would not change considerably, the percentage of grant assistance - money that does not need to be paid back - would more than double. The following table illustrates the impact of this change on Anna's assessed financial assistance package:

Original Assessment - Potential Canada Student Grant for:
Students from Middle-Income Families: $800
Potential Canada Student Loan: $4,852
Potential Provincial or Territorial Funding*: $3,762
Total Potential Assistance: $9,414

Reassessment - Potential Canada Student Grant for:
Students from Low-Income Families: $2,000
Potential Canada Student Loan: $3,666
Potential Provincial or Territorial Funding*: $3,762
Total Potential Assistance: $9,428

*Provincial or territorial funding can be in the form of loans and/or grants, depending on your province or territory of permanent residence.

Q5. What if I'm unable to find a job after completing my studies? Will I still be required to pay back my student loans?

A5. If you're experiencing financial difficulty after completing your studies, the Government of Canada offers solutions to help you repay your Canada Student Loan.

• Starting August 1, 2009, the new federal Repayment Assistance Plan (RAP) made it easier for student loan borrowers to manage their debt by paying back what they can reasonably afford.

Under this Plan:

• Affordable loan payments are based on the borrower's family income and family size.
• Borrowers will not make payments exceeding 20 percent of their income towards loans covered by RAP.
• Borrowers will only be required to make loan payments if their annual income is $20,000 or more.
• No borrow should have a repayment period of more than 15 years (or 10 years if the borrower has a permanent disability).

Borrowers who are not eligible for the Repayment Assistance Plan can choose to extend their repayment period (called a Revision of Terms) to reduce their monthly loan payments.

The new Repayment Assistance Plan replaces the Interest Relief and Debt Reduction in Repayment programs.

For more information on repayment assistance use the Repayment Assistance Estimator tool, or call the National Student Loans Service Centre at 1-888-815-4514 (within North America) or TTY at 1-888-815-4556.

Q6. Are there any specific steps being taken to help students during this economic downturn?

A6. Canada Student Loans and Grants are specifically intended to help students who face financial difficulties and want access to post-secondary studies. If your family income decreases, you may be eligible for more assistance by way of grants, loans, or a combination of both.

Once you complete your studies and begin loan repayment, you may be eligible to apply for the Repayment Assistance Plan, which will ensure that you are only required to make affordable payments on your Canada Student Loan. Your monthly affordable loan payments are calculated based on your family size and family income.