A government student loan is a tax-payer subsidized loan. While you are in school – and over the summer periods between academic years – you are not charged any interest. Most student loan borrowers also receive some of their funds in the form of non-repayable grants. This makes them superior to other types of loans. When you finish school or stop attending, you have six months before payments must be made. However, interest begins to be charged as soon as your period of study ends. It is best for you to begin repaying your loan as soon as you can. Provincial and federal governments have been working hard to make repayment terms as manageable as possible.

Basically the loan life cycle begins with your first day of studies, proceeds through to the academic year end when the 'grace period' begins. As long as you return to full-time studies after the summer your ‘grace period’ is interrupted and you return to academic studies status (back into interest-free status). When you are finally through you enter the grace period 'for real' – interest begins to accrue as of the last day of studies and continues over six months. Then you enter repayment. Again, it is in your best interest to begin payments as soon as possible.

Eligibility is dependent upon personal circumstances, your savings, your parents’ income if you are a ‘dependent’ student, not out of high school for two years, not married, no children, and your projected costs. You do have to be a Canadian citizen or a Permanent Resident. It costs nothing to apply and the ‘old’ income thresholds have been increased considerably (if you had an older sibling who was denied a loan based on parental income, do not assume that this will happen to you – many changes have been made to the program recently to make it easier on middle-income families. The only way to know for sure is to apply – there is no penalty for that. You can also try out the Parental Income Calculator on the CanLearn.ca website – it is fairly accurate and will give you a good idea of what you might expect if you are reluctant to submit an actual application. You will receive written notification of whether you are eligible and what you can expect to receive if you are.

The main reasons students are denied are that they demonstrate no need or they have a poor credit rating. This is based upon a history of being more than 90 days overdue at least three times on three separate debts, each of over $1000 in value when the borrower had control over the circumstances that led to the overdue payments.

New student loan applications are created annually and are available during and after May of each year. If you are applying for a study period that begins after July 1, you cannot apply until the new applications are available (after late May). This is also true for electronic applications. You can apply for loan funding any time after this, up until three weeks before the study period ends. The maximum continuous length of time you may apply for on one application is 12 months. (It is in your best interest to apply for the longest continuous academic study period you will be in within this limit.)

You apply with your home province regardless of which province you plan to study in. (Home province is the one in which you spent the last 12 consecutive months without being a full-time post-secondary student.) Almost all provinces have electronic applications, though there are some situations in which a paper application must be used - this takes

AB - http://alis.alberta.ca
SK - http://www.aee.gov.sk.ca/student-loans/
MB - http://www.gov.mb.ca/educate/sfa/pages/sfaFrontDoor_en.html
BC - http://www.aved.gov.bc.ca/studentaidbc/apply/howtoapply.htm

If your province is not listed simply search your government web site using ‘student loans’ as the search term.

At Lethbridge College, ‘full time study’ is 12 credits per term for fall and winter terms and 6 credits for a spring (May/June) term. If you are on a loan and you drop below this number your loan will be cancelled and you will go into repayment six months from the date you dropped below full-time status. (Students with a documented disability that qualifies them for a reduced course load through our Disabilities Services Office are considered full-time at 8 credits per regular term.)

You can apply for a part-time Canada Student Loan. This cannot be done electronically but we can walk you through the paper-process at Student Awards. You can also apply for a $600 part-time bursary if you meet the low income threshold. That covers the cost of a course and is non-repayable.

Your ‘need’ is assessed based upon your circumstances and your educational costs. Your circumstances include whether or not your parents are expected to contribute (based upon your age, marital status, and their income and number of other children) and your own savings. They add up what your costs will be based upon a typical living allowance and your program’s costs and subtract what they expect your family to contribute. This is what they will consider your “assessed need.”  They will send you a letter telling you what you will get and when. This is an important document.  

The college will confirm your loan and request the tuition and fees for your first term by paid directly to us. The difference between what is disbursed to you in that term and what we request will be deposited into your bank account. This is done electronically for Alberta students, and right on the paper document for students from other provinces – when you bring the document to the Student Awards Office. The Financial Aid Office will also request your winter tuition and fees from your second loan disbursement – if you are receiving one. If you are receiving only grants for your second term you must make the payment yourself.

To find your educational costs you can click on Fees and Financial Information under the "Programs and Courses" tab. Students applying for Alberta Loans will see the costs drop down once they indicate their program of study. (Note: Students in Year 1 or 2 of Nursing must apply for loans as Lethbridge College students even though they apply for admission through the University of Lethbridge. The program is listed as University Transfer - Nursing.) As for living, you can expect to pay approximately $1000 per month to shelter, feed and clothe yourself. Alberta Student Loans allocate $941 for monthly living costs and you are allowed to earn money through part time jobs (in Alberta, up to $800/month) to assist you with this. If you are servicing any debt, you will have to budget extremely carefully.

For Alberta students it is common for your loan to arrive (at the address you used on your application) as already 'confirmed'. This means that Lethbridge College Student Awards staff have electronically confirmed your full-time status and requested an amount to be remitted directly to the College. This amount is generally limited to the balance of tuition and fees you owe for the term you are in or the one you are just about to enter. In general, fees for residence, laptop and daycare are not charged to student loan documents. Any outstanding fees from a prior term may also be requested. If you are not assessed for a second loan disbursement near your second term and/or if your student loan award is not sufficient to cover your fees, you will be responsible for making those payment arrangements.

If your loan document is not marked "confirmed," you must bring it to Student Services to be processed. At this time, no out-of-province loans can be electronically confirmed so all out-of-province loan documents must be brought to Financial Aid Office staff.

Once confirmed by the college, loan documents must go to either the lender representative on campus (they are generally available near Student Services daily at the beginning of each regular term) or to a Canada Post Office designated to handle student loans.

You will require photo identification, your Social Insurance card (or a government of Canada generated document that refers to it) and a VOID cheque (or have your bank complete the banking information for you - it is vital that this information appears correctly). Once you have processed your document with the campus lender representative or a designated Post Office, the document is on its way into the system and the College will receive the fees it has requested. Whatever loan balance remains (if there is one) will be deposited into your bank account. The time it takes for this to occur varies, but students can generally expect their funds to 'land' in their bank accounts one to two weeks after processing.

The college will confirm your loan and request the tuition and fees for your first term by paid directly to us. The difference between what is disbursed to you in that term and what we request will be deposited into your bank account. This is done electronically for Alberta students, and right on the paper document for students from other provinces – when you bring the document to the Student Awards Office. If you do not receive enough loan monies to cover your college fees you will be expected to pay them some other way. Remember, we can only access loan money – anything you receive in the form of a grant goes directly to you so it is your responsibility to watch your WebAdvisor account information to ensure that your balance is covered. You can also bring in your Notice of Assessment and we will explain the process to you.

Your Notice of Assessment tells you how much you will receive and when. Add that up, subtract your tuition, fees, books and supplies and divide the remainder by eight. That will be what you will have left for monthly expenses. Be careful – almost all student loan borrowers receive more in the first term than in the second, so budgeting is essential!

You can appeal your assessment by completing a ‘Change of Circumstance’ form - available at Student Services or downloadable from the http://alis.alberta.ca site. Submit completed forms at Student Services to be couriered in order to speed up the process. This review generally takes four-six weeks. Be advised that there are maximums for living, tuition, fees and books; if you exceed these you aren’t likely to be awarded any additional funds. Other provinces have appeal forms as well.

It is essential that you inform your lender province and Canada Student Loans Service Centre if you change your marital status, address, have a child, withdraw from your program or change institutions. If you have completed your studies at one institution and continue at another without a loan you will need a Schedule 2 completed at your new institution to avoid going into repayment.

As long as you are in school and the lender knows this (either by your continued borrowing or the submission of a Schedule 2, you should be fine. If you withdraw you will go into repayment in six months. If you cannot repay you need to contact your lenders and request assistance. There are programs for interest relief (Repayment Assistance Program) that will help or you can negotiate your payments with Edulinx (www.edulinx.ca). Do not ignore any requests for payment. Always stay in contact with the lenders when there are problems. Ignoring payments will lead to default, your account will go to Collections and your credit rating will be impacted. They will work with you – they want you to be able to repay them and can be quite flexible.

If you are still in repayment for a previous student loan you must notify your previous lender that you are now a full-time student. This means that you must request a Schedule 2 from the college - it can only be completed while you are in studies, not before and not after, and send it off to your lender.There is no repayment relief for part-time students. The form required varies depending on your lender and must be authorized by Student Awards staff.

Be sure to respond to any repayment requests promptly. Do not leave this until the last minute or you may be required to make some payments even if you are enrolled as a full-time student.

If you are on a loan and you drop below 12 credits in a regular term your loan will be cancelled and you will go into repayment six months from the date you dropped below full-time status. If you return within that six-month period and apply for another loan, you will just have an overpayment calculated into your debt (money you have received). You will have to apply with a paper application though - so allow plenty of time.

Interest begins to be charged as soon as you finish school (graduate or don’t return after the summer). You will receive letters informing you of what the interest rates are and you can choose between ‘fixed’ and ‘floating’ rates. Be sure to check out the ‘exit counselling’ session at www.edulinx.ca for all kinds of detailed information on repayment and interest calculations.

You do have the option to pay this interest prior to your loans entering repayment through .a one-time payment prior to your loans entering repayment or via numerous payments throughout the grace period as the interest accumulates. The benefit of paying the interest before you begin repayment is that you can claim a 17% tax credit on this interest. This option may slightly reduce your monthly payment amount.

The grace period is the term for the time between your full time studies and the next six months. Be sure that you understand that it is payments that are ‘in grace’ not interest. Interest begins to be charged to your loan balance as soon as the ‘end of studies date’ you indicated on your application begins (not including summer breaks). You can begin repaying early to avoid having this interest compounded with your principal.

You really need to keep your address up-to-date with your lenders so that you are aware of what is required. Most students have to make payments to two lenders – the province and the national program so be sure about what your own situation is. The following are some important pointers:

• Never miss a payment
• While your grace period is 6 months and you do not have to make a payment over this time, interest is accruing, so it is in your best interest to make payments as soon as you can – you can do this during the grace period
• If you have any trouble with payment, contact your lenders immediately: there are programs that can help with almost any circumstance – you can’t afford to just ignore your debt
• You can repay before the six months end – in fact you can make lump sum or one-time extra payments anytime (this will reduce your principal and repayment period or choose to increase your payments by even $20 a month and make a noticeable difference in interest saved and repayment term)
• You need to ensure that all of your contact information is current with both lenders (unless you are funded by an integrated province
• Remember most provinces require two payments and one is always a lesser amount and will be paid off before your Canada Student Loan – when you receive your notice that your Alberta (or BC, or Manitoba) has been repaid, remember that you still owe on your Canada Student Loan  (60% of your loan is the Canada portion)
• Changing your payments to biweekly instead of monthly can save you a lot of money and shorten your repayment period
• Interest rates is prime for Alberta (or you can lock in at the current prime rate plus 2%- this option is less popular)
• The “floating” interest rate for Canada Student Loans is prime + 2.5% or you can lock in at prime + 5% (this is rarely recommended)
  Basically, the longer your repayment period, the more your loan costs you, so anything you can do to speed things up is to your benefit
• f you have an Alberta Loan and you received the maximum loan amount, you may be eligible for the Alberta Loan Relief Completion Benefit – it would have been calculated into your final year as a grant as long as you indicated that you were in your final year – if you did not indicate that this was your final year of studies you should contact Alberta Students Finance as soon as possible to avoid paying extra interest  (1-800-222-6485)
• You can renegotiate your Alberta repayment terms with Edulinx at www.edulinx.ca anytime or 1-866-827-0310 and with the National Student Loans Service Centre at https://nslsc.canlearn.ca/eng/register.aspx or by calling (1-888-815-4514)

You need to know what you will have to work for in order to plan for the next eight months. You do this by completing a monthly income and expenditure worksheet (commonly referred to as a budget). If you have a student loan you will need your Notice of Assessment in order to plan as it lets you know when you will receive your government funds and how much they will be. Retain all of your copies of loan related documents - they are necessary for the next year's application and will also keep you apprised of how much tuition and fee money was 'remitted' from each loan to the institution.

The plan takes into account everything that you receive and everything that you must pay. You subtract your expenses from your income and (hopefully) you will have a balance remaining. That would be what you have left to spend or save at your discretion. If you have a negative balance you need to increase your income or reduce your expenses.

Your income may be a little complicated – most people have some amounts they receive monthly and some they only receive once or twice (like a student loan or a GST cheque).Regular sources of income are typically employment, child tax credits, maintenance grants, and so on. It is important that you recognize the difference and divide the irregular amounts into what they amount to monthly.

Like income, expenses can be regular and irregular. Regular expenses are things like rent, food, utilities, car payments, gasoline or bus passes, cell phones, and anything that must be paid by the month. Irregular expenses are things that you pay occasionally: car registration, insurance, internet, repairs, and so on. For these, you need to add them up and divide them by eight (for the two academic terms) to see what they cost you monthly. Even if you don’t pay them each month, the money has to be there.

Click on the link below to complete an online budget form. This site is part of the CanLearn - provided by the Canada Student Loans program. http://tools.canlearn.ca/cslgs-scpse/cln-cln/40/fp-pf/fp-pf.obp.do

There are always ways to reduce spending. It may be difficult for you to see things you could do without yourself - some people find it helpful to have a friend review their spending habits to make suggestions. Most of us don’t want to give up anything. But if you buy newspapers or magazines, cigarettes, liquor, candy, junk food, lunch at the cafeteria there are areas where you can cut back. Even in some necessities, like insurance, there are often better deals to be had. Phone around. Check with your bank to see if you are getting the best service package for your ‘type.’ Find a hair salon that charges less, buy necessities in bulk – share costs with others if they are interested. Buy used clothing and cut back on entertainment (there are lots of free activities available through school and public libraries). If you have credit card debt check out options on the best cards for students – this information is available on the internet. Try to avoid using a credit card unless you can pay off the balance monthly. Interest on cards is high and just keeps on building. If you’ve done all you can to reduce costs and you still have a shortfall, and you have a student loan, you will need to make some money. Look into ‘The Works’ on campus and submit a resume. They have a program that will match your skills to an employment opportunity and will also help you with employability-related issues.

Paying down debt is the best use of any ‘extra’ money you have on hand. It may not be fun, but it really pays off. But, you don’t have to give up everything. Write down the pros and cons of the various things you would like to do with the money and leave some room for compromise. You can always put some down on debt and give yourself a little reward as well. If you have money left over, you’ve earned one! Remember though, the benefit of paying the interest on a student loan prior to your formal repayment period is that you can claim a 17% tax credit on this interest. Reducing the interest that accrues during your grace period will reduce your overall principal and save you real money.

Everyone who has ever borrowed money or received a credit card in their name has a credit rating. Even a video membership can impact your credit rating. In your file a potential lender will find your address, date of birth, employment history, income and your credit status. This ‘status’ includes any information on late payments, current debt, payment history on current and past debt and any companies that have made credit inquiries into your status. Unpaid taxes, bankruptcies and financial judgements against you are also included. There are two primary credit reporting agencies - Equifax Canada Inc. and Trans Union of Canada. You can see your own credit report by mailing the required information to both agencies, along with required signed identification. More information can be accessed at www.equifax.ca and ww.tuc.ca. You may find that there is incorrect information about you or that positive information/payment history is missing. You have the right to ask to have this corrected.

Some credit cards offer extended warrantees, insurance or reward points. If you think you will have to book hotel rooms or rental cars you will need to have one. They can also be handy in case of real emergencies. It is in your best interest to only have one. Having more may tempt you to overspend. You can also request a low limit so that you are less likely to get in over your head.  Before you choose a credit card be aware of what you are applying for. Check out http://www.creditcards.ca/ to see what the interest rates and annual fees are for all the cards listed. You should not have to pay an annual fee and you will see that interest rates vary from just under 10 percent to up to almost 30 for store cards. The average rate for bank credit cards is around 18.5, which is extremely high if you look at the kind of interest you would make on a savings account (around 3 percent these days).

There are many risks associated with credit cards. If you are the kind of person who finds it hard to resist new gadgets, sales, special offers, spontaneous acts of generosity towards friends and so on, it would be best for you to forego a credit card. You can get by with a debit card for most things and the nice thing about debit cards is that they don’t allow you to spend what you don’t have.  The most dangerous pitfall of having a credit card is the outcome of not paying off your entire balance on time. When that happens the interest on the entire amount – the interest plus what you owed (the principal) are added together and become the new principal, and then interest is charged on that new total (this is called ‘compound interest’). If you continue to do this over time, the amount owing can become a serious obstacle.  Making minimum payments on a regular basis costs you big money – money you are paying for nothing, except an impetuous decision. Do whatever you can to pay off your entire balance every month – make it a rule not to use your card unless you can do this.

Interest begins to be calculated as soon as a payment due by date has passed and a balance remains unpaid. Some companies start the interest calculation on the date of the purchase rather than the date the payment was due so you are charged even more. While the amount of interest is displayed as an annual amount, it is calculated on a daily basis. For example, if the interest rate on your card is 18.5%, the daily interest rate is 0.05068%, which doesn’t sound like much. However, if you made a purchase of $3000 on the 5th day of your payment period and did not pay off the entire balance on the due date, the interest charged would be just over $41. That would be based on 27 days of a $3000 balance, over a 31 day period, multiplied by the annual interest rate, divided by 365. Then, if you cannot pay the new balance of 3041 the following month, this interest is calculated again, it will be slightly more and it will again be added to your principal. It’s a little complicated but suffice it to say, paying interest is a nasty way to waste your money.

You can make purchases on-line when necessary, it serves as a second form of identification, you may be able to accumulate points that get you something for nothing – but only if you obtain a free card and pay the entire balance by its due date every month. You have to think of it as the same as a debit card with a little delay. Whenever you use a credit card and do not pay the entire balance you are losing money. Using a credit card responsibly can help you to build a good credit rating for the future – mortgage, car loan, other essential purchases. But the caveat is ‘responsibly’ – missing payments will actually damage your credit rating so be sure you understand what you are getting into before you decide to use that card.

If you are paying only the minimum balance on your credit card you are already having credit card trouble. If you have gone beyond this to use one credit card to pay off another, have had your utilities cut off, have bounced cheques and/or had to borrow from friends or family you are having serious financial trouble. Stop using your card immediately. You may need to see a credit counsellor to arrange for Orderly Payment of Debt or another alternative. Money Mentors can be accessed in Lethbridge at Suite 101, Idea Building, 1221 - 2nd Ave South or emailed at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it