Interest Relief is Ending - for your Canada Student Loans

That's right - there will soon be no more "IR" for people with Canada Student Loans. No more Debt Reduction, either, as noted earlier in our "Newsflash."
 
Interest relief (IR) gives you a complete break from your monthly student loan payments. It doesn't cut your debt, but it does keep it from growing larger through interest charges during the time you don't have to pay.
 
IR is a helpful tool, so some people will regret losing that total break from payments when they're financially strapped.
 
Don't worry about your provincial student loans - your OSAPs, BCSLs and such. Provincial governments may phase out IR in time, but the word we have right now is that IR will first end with just the Canada Student Loans Program.
 
And yes, just like the end of federal DRR (Debt Reduction), the cancellation of IR will apply to every type of federal student loan. Risk-shared, guaranteed loan, direct... every type of federal government student loan is part of the changeover.
 
So help... what are you changing to? For those who qualify, the new Repayment Assistance Plan (RAP) will take the place of interest relief and debt reduction.
 
RAP will mean lower minimum monthly payments because your scheduled repayments will be stretched out over 15 years instead of the current 9.5 years (10 years when you add you 'grace period').
 
If you go at this slower pace, you will pay more money in interest charges. However, at the end of that 15-year time, those who still qualify will have their remaining Canada student loan debt forgiven.
 
RAP officially begins on August 1, 2009. This Forum will soon have a posting on how RAP works.
 
If you want to squeeze out an extra 6 months of federal Interest Relief, see this posting tomorrow: Applying for the Last Interest Relief (Canada Student Loans).
 
 
 
Jay B replied: (comments disabled due to spam) 
 
How come this is the first I've heard about this!!??? If this is really ending soon, the media should be talking about it. Guess the government doesn't tell you they're ending a program but what happened to the news?!?
 
But I don't mean to be negative here because at least you found out and told people. This is a great website actually - I just found it by accident. So thanks for warning us (if this is true???)