Loan error costs students

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By Erin Rankin

Students who went to the Financial Assistance office prior to Sept. 10 found out they couldn’t submit the necessary forms to put student loan payments on hold while they got more education, instead they learned they would have to return at a later date once Ministry of Education computer problems were fixed.

For Etoile Stewart, a graduate student in the Communications and Culture program, the process has been confusing and time consuming. “I’m totally unclear what the process is or how it will affect me,” she said. “I came during the first week of class, was told they couldn’t process the form and that I would have to come back. I was e-mailed yesterday, I came picked up the form, then had to come back again-I don’t get it-I ‘m already in their database so why do I have to come back and stand in line,” she said.

Banks need notification from the Ministry of Education that a student who has graduated is going back to school full time before it will suspend a loan. Students must pick up a special form called a Schedule 2/Form R from the financial assistance office, fill it out, and return it. The financial assistance office notifies the Ministry of Education, who then informs the bank. While the student is in school, the government pays the interest on the loan for the student.

“Last year the province of Ontario paid $9.6 million on student loan interest for more than 37,000 students who returned to complete another degree,” said Dave Ross, Ministry of Education spokesperson.

Students continue to accumulate interest and are expected to pay down their debt until the bank is notified of the student’s full time status, said Nema Nsa, a customer service representative with CIBC. Until a bank receives notice from the ministry it charges interest on loans regardless of whether or not the student is attending class. On a loan of only $4,000 with seven per cent interest, a student could have to pay an additional $20 in interest if the bank doesn’t receive notification until October.

In August 2003, the Ministry of Education began phasing in the last part of a new automated system that would allow students to deal only with their school’s financial aid office.

In previous years, students took forms directly to their bank. Copies of the form were then sent to the Financial Assistance Office and the Ministry. Carole Scarse, Manager of the Ryerson Financial Office, says, the new automated system is simpler because students still had to go to the Financial Assistance Office before going to the bank.

The new system will also let the Financial Assistance Office track paperwork if the bank’s student loan centre does not receive notice, says Scarse. The Ministry began experiencing computer problems when the Blaster worm infected its network on two separate occasions, then the blackout hit and prevented repair, but the system was running by Sept.3, says Ross.

Ryerson’s Financial Aid Office continued to experience problems up to Sept. 10, after which staff were able to begin processing forms.

The further delays happened because some users had not cleaned their computer systems, which caused instability in the Ministry’s network, says Ross.

Last week the Financial Aid Office began emailing students to come and pick up their forms. Staff has been inputting the student’s data in the meantime, says Scarse.┬áScarse expects once the new system is up and running it will cut down on time and make it easier for graduate students to return to interest-free status. In the meantime, Scarse is advising students to check with their bank by mid-October to make sure it has received notification from the Ministry.

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