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Repayment Assistance Plan (RAP)

Effective August 1, 2011, the Provincial Government will be adopting the student loan Repayment Assistance Plan to align with a corresponding Federal Government initiative.

You are responsible for repaying all the money you borrow to fund your education. The Repayment Assistance Plan (RAP) can help if you have difficulty making your student loan payments.

The RAP makes it easier for you to manage your debt by requiring you to pay back what you can reasonably afford, based on your family income and family size. Monthly payments are limited to less than 20% of a borrower’s family income, and no borrower will have a repayment period of more than 15 years (10 years for borrowers with permanent disabilities). In cases where borrowers earn very little income, they may not have to make any loan payments until their income increases.

The National Student Loan Service Centre (NSLSC) administers the RAP on behalf of the Governments of Canada and Newfoundland and Labrador. If you face financial difficulty after completing your studies, call the NSLSC (1-888-815-4514) before you begin missing payments. Help is available.

NSLSC Online Services enable you to review your student loan accounts and to view and change your contact information. Visit CanLearn.ca to sign up for an online account.

How Does the RAP Work?

Depending on your financial circumstances, the RAP has two stages to help you fully repay your student loan within 15 years.

Stage I

This stage applies to the first five years of the plan.

• Borrowers who qualify will make affordable payments (or no payment) toward the principal of the student loans; paying the principal first reduces the total debt.
• Borrowers will not make payments exceeding 20% of their income toward loans covered by RAP. In cases where the borrower has very low income, no payments are required.
• The Government of Canada will cover the amount of interest owing that the borrower’s payments do not cover. (Newfoundland and Labrador does not charge interest on provincial student loans post August 1, 2009.)

Stage II

This stage starts once the borrower completes Stage I or after the borrower has been repaying the loan for 10 years.

• The Government of Canada will continue to cover interest and both the Governments of Canada and Newfoundland and Labrador will begin to cover the portion of the principal of the loan not met by the borrower’s affordable payment.
• The balance of the loan should be gradually paid off so that no student loan debt remains after 15 years (or 10 years for persons with permanent disabilities).
• Throughout this period, borrowers will need to meet the same eligibility criteria and will continue to make affordable payments.

Am I Eligible?

To be eligible for the Repayment Assistance Plan you must:

• be a resident of Canada;
• have signed and returned your Consolidated Student Loan Agreement to the NSLSC; and ,
• meet the financial eligibility criteria.

How Do I Apply?

You need to apply for the RAP; enrolment is not automatic.

• Call the NSLSC at 1-888-815-4514 to request an application form or to get more information about the plan.
• Complete the application form and submit it, along with all required supporting documentation, to the NSLSC.
• RAP is approved in six-month intervals; you must reapply after each six-month approved period.
• Applications are also available through your NSLSC Online Services account on CanLearn.ca .