Don't Miss Out on Interest Relief!
Federal statistics show that roughly half of Canadians eligible for Interest Relief (IR) do not apply for this assistance.
Don't be one of them. Interest relief keeps you out of trouble when your income drops too low to make your monthly payments on government-backed student loans. 'IR' helps you get a grip on your finances, so go for it.
Note: Interest Relief ENDED July 31, 2009 for Canada Student Loans. But this will not affect Interest Relief for provincial loans (or the provincial share of integrated loans).
WHAT IS INTEREST RELIEF?
When you're accepted for "IR", the government pays the interest costs on your provincial student loan.
With IR, your debt remains the same. And when it's all used up, you'll still face the same number of months before your debt's all gone. But IR gives you a chance to breathe – and catch up on any other debts you've got.
And if your spare change won't have to go toward other debts when you're on the IR program, you'll have a money-saving opportunity to get more value from paying down your loan.
That's right. Try to pay even though the point of IR is that you don't have to pay right now!
When you're on IR, every cent you of your voluntary payment gets taken off your principal (the amount you borrowed). Nothing is wasted on interest costs. That's already covered by your IR.
These voluntary payments won't affect your eligibility for your current or future IR. As long as you gave accurate income information when you applied, where you find money for extra payments now is your business.
Eligibility rules are similar for the provincial IR programs (which help with provincial loans).Normally, they provide interest relief for 6-month periods and you can stack these up for a total 30 or 54 months, depending on what your province allows.
For more details, talk to your loan lender or hit the links in Learn More (below).
UPDATE: FEDERAL "IR" ENDED JULY 31, 2009.
Our RAP articles will explain the federal program that replaced Interest Relief on Canada Student Loans. As well, some provinces still offer Interest Relief.