Canadian Student Loans

A student loan is a form of financial aid offered by the government, banks, and other financial institutions to help students fund their college or university education. When grants, scholarships, and other desirable forms of financial aid fall short of enabling a student to cover the total cost of attendance, student loans can be a great way to help fill the financial gap. Some governments and most major banks offer student loans that have low interest rates and flexible repayment options. Rates, options, and specifically flexible features of certain loans vary from lender to lender and even from loan to loan, so it is important that you thoroughly research lenders and loan options that are available to you. If you are looking to compare your private loan options, you can simply use our Student Loan Comparison Tool above to search, compare, and apply for private student loans that meet your financial needs.

Types of Canadian Loans

There are two main types of student loans in Canada, these being the state owned Canada Student Loan Program (CSLP) and the Commercial Loan Programs. Commercial Loan Programs are essentially private Canadian student loans, and commercial Canadian student loans consist of direct-to-consumer loans and school channel loans. The major difference in these two commercial Canadian student loans is that school channel loans are given to the borrower’s school to be applied directly to the borrower’s tuition bill. Direct-to-consumer loans, conversely, are given directly to the borrower to be used as they see fit. Most students prefer direct-to-consumer loans due to the increased flexibility it offers in managing the financial aid money received.

Requirements and Features

To receive a Canadian student loan, a student must first apply for a provincial or territorial student loan, after which the student will be automatically considered for a Canada Student Loan. The necessary applications are available from provincial or territorial student assistance offices and a school’s financial aid office. Students must apply every year for the loan(s), and must show proof of enrollment within six months of their last semester in school to the lenders in order to maintain interest-free status. Not all provinces or territories participate in the CSLP, so you should check with your government’s student assistance office. More information can be found from the National Student Loans Service Centre (NSLSC). Some Canadian student loan disbursers require a good credit history to approve a student for a loan, but there are lenders for applicants with relatively poor credit histories as well. Canadian student loans usually come with low interest rates, and you are not required to start repaying the loan until after you complete your education. Some of the lenders in Canada also offer deferment of repayment for a specific period of time, if provided with a valid financial reason.

Frequently Asked Questions

Can you tell me about private Canadian student loans?

Primarily, there are two types of Canadian student loans: Direct Consumer Loans and loans through the school. Most students prefer Direct Consumer Loans because they provide more freedom. School Channel Loans are given directly to the educational institution and are used by the university for each student’s tuition and other expenses.

Is there an option for consolidation with Canadian national student loans?

Canadian national loans offer a consolidation option in order to assist students with their payments. The consolidation option can be accessed if the student has received both Canadian and integrated loans. Students can consolidate their loans six months after their education has ended.

Can you tell me more about Canadian loans for international study?

These loans are popular student financial solutions offered by a number of Canadian financial institutions. The high costs of education have made it impossible for many students to study, but with the help of these loans, you can enroll in your favorite degree program and prepare for a great career.

 

Types of Student Loans