Each year, thousands of Canadians rely on student loans to help fund their continuing education. Getting a student loan is an investment in your future as it helps you to get an education which in turn, will help create better job and career opportunities.

Unfortunately, once you graduate from post-secondary school, life gets in the way. Many graduates end up facing competitive job markets, changing economic times, unexpected illnesses or life situations, or the inability to find a job in your chosen field. These factors can make it very difficult to live comfortably, let alone have enough money to pay back their student loans.

Fortunately, if you are struggling and your student loan repayments are causing you financial and emotional stress, you do have some options for dealing with your debt.

Repayment Assistance Plan
If you are finding it difficult to make your monthly federal student loan payments, you are able to apply to have your financial situation reviewed. The government will assess what you are able to afford, based on factors such as income and family size, to contribute towards your student loan on a monthly basis. In some cases, borrowers may not have to make any student loan payments until their income increases. To complete your Repayment Assistance Plan application you will need to provide your Total Gross Monthly Family Income and if, applicable, your spouse/common-law partner’s Total Gross Monthly Family Income. You may also need to provide information on your government student loans. If you do not have this information on hand, you can still start and save your application, then return to it later. To find out how to file an application log onto your NSLSC account and review your Repayment Options.

Consumer Proposal
Most people who borrowed money to fund their education want to repay the debt; they just may need more time, or a more efficient plan, to do so. A consumer proposal allows you to negotiate to reduce the amount of debt you owe and consolidate the remaining outstanding debt into one manageable monthly payment. Student loan debt can only be included in a consumer proposal if you have been out of school for seven years. If that’s not the case, a consumer proposal may still be a viable option as it makes your monthly debt more manageable and may allow you to afford to pay your student loan payments.

Bankruptcy
If you’ve been out of school for seven years and are still having trouble taking control of your debt, you may consider filing for bankruptcy. In doing so, you will be discharged from your student loan debt.

If you haven’t been out of school for seven years, the same rule applies for bankruptcy as it does for a consumer proposal. Student loan debt cannot be included in a bankruptcy.

If you’re struggling with student loan debt, contact us today for a free, no-obligation consultation. 

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