How to repay your loans with (or without) grace

By Izabella Balcerzak

What’s a four letter word that gives your more anxiety than sleeping past your alarm or getting shat on by a flock of campus pigeons?

The answer to the world’s worst riddle is L-OA-N, and it’s coming faster than expected thanks to the Ford government making crucial changes to how and when student loans are paid back. Access to the Ontario Student Assistance Program (OSAP) will be focused on lower-income families, with students receiving more loans than grants. Most importantly, that six-month interest-free grace period many of us rely on is gone–and it kicks in as soon as you graduate.

We’re going to try to make this as painless as possible since the National Student Loans Service Centre (NSLSC) website can cause major headaches, yet you need it to pay off any outstanding fees. Follow these steps to ensure you avoid whatever  jail time OSAP gives out to poor unfortunate souls like ourselves.

So, what’s up with the six-month grace period?

Although this still remains on the Ontario portion of your loan (1 per cent), you’ll be accumulating interest on the Canada portion of the loan (2.5 per cent) as soon as you gradu-ate. Those fuckers. You can choose to either pay the interest rates monthly, as a lump sum, or have the amount added to your loan total after the six month non-repayment period ends.

Estimate monthly payments:

Find out how much you think you owe by multiplying your loan amount by 0.025 (Canada interest rate) or 0.01 (Ontario rate). It’s important to note that if interest rates change, your monthly payment stays the same. However, the amount applied to your loan balance (known as the “principal” amount) will change.The loan is integrated, which means you can’t pay off the federal or provincial portion separately. You will receive the breakdown of both parts when you enter the grace period. However, you won’t be able to calculate how much exact interest will accumulate during the grace period until you enter the grace period.

Finalize details:

Decide which bank account you’ll use to repay the loan, the monthly amount, automatic or manual payments and finally, how long it will take to release this burden.

Paying it off:

Whatever is on your account as of May 1 is what you will be charged interest on. If you want to pay off your loan in full, the NSLSC must receive the payment by April 30, 2019. It can take up to four business days to process, so we recommend submitting it by April 24, just to be safe. You don’t want to spend the last week of your semester stressing the fuck out.

Start repaying your loans:

Send payments to NSLSC and not to OSAP. If you are using online banking, the NSLSC is listed as a payee. TD and CIBC will list “National Student Loan Service” while BMO uses “NSLS”. Payments are based on the average time a student usually takes to pay back their loans—a whopping 9 1/2 years.

Repayment assistance:

To lower your monthly amounts, go to your NSLSC account and fill out either an online or paper application. Your family income, size and any outstanding OSAP loans will be considered. You must reap-ply every six months. The Severe Permanent Disability Benefit is also available to students who can’t attend work or school be-cause of their disability.

What happens if you don’t repay your loans?

You will be in this weird grey limbo the government calls “default”. This means you’ll most likely be reported to a credit bureau where your debt is overturned to a collection agency. You could be ineligible for further OSAP and a ton of other shit you probably don’t want to find out about. Whatever you owe, we hope this guide answers any burning questions. If you have specific queries, call the NSLSC directly or use campus financial services. Don’t worry—you’ve got this and we believe in you