Darien Ramkisson is currently paying off his Ontario Student Assistance Program (OSAP) debt similar to more than 100,000 bachelor graduates.

Ramkisson was out of school for a year and a half. He was a student at Humber College for the civil engineering program. When he didn’t enjoy the program, he switched to Centennial College to an automotive apprenticeship program. Since he took a year and a half off after Humber College, he said he had to start paying back his OSAP after a six-month grace period.

Ramkisson said he uses the Repayment Assistance Plan, so he doesnot have to pay his loan during the months he is in school. When he is apprenticing, he said he pays OSAP monthly through direct deposit transfer.

James Walker, student financial services manager at the University of Guelph-Humber, suggests students, “never avoid the payment but work with the National Student Loan Service Centre because there are programs that can provide help; however, if they avoid payments, then they can lose out on the programs.”

If a student is struggling to pay their loans due to unemployment or underemployment they can apply to the Repayment Assistance Plan, said Walker.

Walker added the loan is administered by the National Student Loan Service Centre (NSLSC). When students are finished school, they start a six-month grace period. After the grace period is over, students go into repayment.

According to Tanya Blazina, the team lead of issues management and media relations at the Ministry of Advanced Education and Skills Development, said the government introduced the Repayment Assistance Plan in 2010 for borrowers who are experiencing financial difficulties repaying their student loans.

Daniel Castillo-Sanchez, financial aid manager at Humber College, said students are not required to pay back their loan during the six-month grace period; however, they have to pay the interest rate charged by the federal government.

Castillo-Sanchez said the monthly payment takes the total debt amortized over a nine-and-a-half-year period. The NSLSC notifies the student a month or two before they go into the repayment period.

Castillo-Sanchez said once a student receives that repayment notice, they can pay their full loan amount to avoid any interest. He said if they are in the position to pay more than their monthly payments they can also adjust their plan accordingly.

Walker said students have to provide their banking information to the NSLSC in order to pay monthly. Although the repayment period is over nine-and-a-half-years, if they are struggling to pay back their loan, they can increase the period up to 15 years.

Walker directed students to an application on the National Student Loan Service Centre’s website.

https://www.canada.ca/content/dam/canada/employment-social-development/migration/documents/assets/portfolio/docs/en/student_loans/forms/repayment-assistance.pdf

Castillo-Sanchez said this program helps students by either postponing their loans for another six-month period, or they can reduce their payment to no more than 20 per cent of their monthly income.

Though they have to re-apply every six months, Walker said a borrower can use the Repayment Assistance Plan for maximum of five years. If a borrower is still unable to make their payments after being on the Repayment Assistance Plan for five years, the government starts paying their loan on their behalf.

However, Castillo-Sanchez said when the government starts paying back a student’s loan, theloan recipient isno longer eligible to apply for OSAP again unless that recipient repays the amount that the government paid on their behalf.