Canadian Student Loans Guide 2026: Repayment, Forgiveness, and Help
By Wealthvieu
·
Updated
Canadian student loans are interest-free federally and offer income-driven repayment. Here’s how to manage your student debt.
Federal Student Loan Basics
| Feature |
Details |
| Interest rate |
0% (permanently, since April 2023) |
| Grace period |
6 months after school (no payments) |
| Repayment term |
Up to 9.5 years (extendable) |
| Forgiveness |
After 15 years on RAP |
Loan Limits
Federal Canada Student Loans
| Level |
Weekly Limit |
Annual (~34 weeks) |
| Undergraduate |
$210 |
$7,140 |
| Graduate |
$350 |
$11,900 |
Provincial Loans (Additional)
| Province |
Weekly Limit (approx) |
| Ontario (OSAP) |
$195 |
| British Columbia |
$140 |
| Alberta |
$195 |
Total available: Federal + Provincial combined.
Interest Rates
Current Rates
| Loan Type |
Interest Rate |
| Canada Student Loans |
0% |
| Canada Apprentice Loans |
0% |
| Provincial loans |
Varies (0-prime) |
Provincial Interest
| Province |
Rate |
| Ontario |
0% (OSAP) |
| British Columbia |
0% |
| Alberta |
0% |
| Quebec |
Prime |
| Other provinces |
Varies |
Repayment Assistance Program (RAP)
Stage 1: Reduced Payments
| Feature |
Details |
| Income threshold |
Under ~$40,000 |
| Payment |
Maximum 20% of income |
| Government covers |
Interest (now moot at 0%) |
| Duration |
Up to 60 months |
RAP Payment Examples
| Annual Income |
Monthly Payment |
| $20,000 |
$0 |
| $30,000 |
$100-$150 |
| $40,000 |
$200-$300 |
| $50,000+ |
Full payment |
Stage 2: Principal Reduction
| Feature |
Details |
| Who qualifies |
After 60 months on RAP |
| Government covers |
Principal + interest |
| Duration |
Until repaid or 15 years |
Forgiveness After 15 Years
| Feature |
Details |
| When |
After 15 years on RAP |
| What’s forgiven |
Remaining federal loan balance |
| Tax impact |
None (not taxable income) |
Repayment Options
Standard Repayment
| Loan Size |
Monthly Payment |
Term |
| $15,000 |
$158 |
9.5 years |
| $25,000 |
$263 |
9.5 years |
| $40,000 |
$421 |
9.5 years |
| $60,000 |
$631 |
9.5 years |
Accelerated Repayment
| Strategy |
Benefit |
| Pay more than minimum |
Pay off faster |
| Lump sum payments |
No penalty |
| Bi-weekly instead of monthly |
Extra payment/year |
Extended Repayment
| Feature |
Details |
| Maximum term |
14.5 years |
| Who qualifies |
High debt-to-income |
| Lower payments |
But same total (0% interest) |
Loan Forgiveness Programs
Canada Student Loan Forgiveness
| Program |
Eligibility |
Amount |
| Doctors/Nurse Practitioners |
Underserved communities |
Up to $60,000 |
| Family medicine residents |
Underserved areas |
Up to $40,000 |
| Nurses |
Some remote areas |
Varies provincially |
Provincial Forgiveness
| Province |
Program |
| Ontario |
Northern Relocation Incentive |
| Manitoba |
Tuition Rebate |
| Nova Scotia |
Loan Forgiveness (if work in NS) |
| Others |
Various nursing/teaching programs |
Repayment Strategies
With $30,000 Student Loan
| Strategy |
Monthly |
Term |
Total Paid |
| Minimum |
$316 |
9.5 years |
$30,000 |
| Aggressive ($500) |
$500 |
5 years |
$30,000 |
| Very aggressive ($800) |
$800 |
3.1 years |
$30,000 |
With 0% interest, total paid equals balance regardless of speed.
Prioritization (Multiple Debts)
| Priority |
Debt Type |
Why |
| 1 |
Credit cards |
Highest interest (20%+) |
| 2 |
Provincial loans (if interest) |
Some charge interest |
| 3 |
Canada Student Loans |
0% interest |
Pay high-interest debt first.
While Still in School
During Studies
| Feature |
Details |
| Interest |
None |
| Payments required |
No |
| Loans increase |
Each year |
Summer Work
| Action |
Benefit |
| Work during summer |
No payment required |
| Save for tuition |
Reduce borrowing |
| Pay interest (if provincial) |
Reduce total cost |
Consolidation
Federal + Provincial
| Feature |
Details |
| Combined? |
No — separate loans |
| One payment? |
Often consolidated billing |
| Rates |
Each keeps own rate |
Private Consolidation
| Feature |
Details |
| Should you? |
Generally no |
| Why not |
Lose RAP, forgiveness protections |
| Exception |
If provincial rate is high |
Tax Benefits
Student Loan Interest Credit
| Feature |
Details |
| Credit |
15% of interest paid |
| Carry forward |
5 years |
| Current benefit |
$0 (federal loans 0%) |
Tuition Credits
| Feature |
Details |
| Amount |
15% federal + provincial |
| Carry forward |
Indefinitely |
| Transfer |
Up to $5,000 to parent/spouse |
Provincial Programs
Ontario (OSAP)
| Feature |
Details |
| Grant portion |
Up to $7,500/year |
| Interest |
0% |
| Combined with federal |
One application |
British Columbia
| Feature |
Details |
| BC Student Loan |
0% interest |
| Combined with CSL |
Yes |
| Repayment Assistance |
BC RAP |
Alberta
| Feature |
Details |
| Alberta Student Loan |
0% interest |
| Combined |
Student Aid Alberta |
Struggling to Pay?
| Option |
When to Use |
| RAP |
Income under threshold |
| Extended term |
Need lower payments |
| Revision of Terms |
Changed circumstances |
| Bankruptcy |
Last resort (7+ year wait) |
If You Miss Payments
| Consequence |
Timing |
| Late fees |
May apply |
| Credit score impact |
After 30 days |
| Collections |
After 270 days |
| CRA intercepts refunds |
In default |
Bottom Line
| Situation |
Strategy |
| Low income |
Apply for RAP |
| Can afford payments |
Pay off (no interest penalty) |
| High-interest other debt |
Pay that first |
| Struggling |
Never ignore — use RAP |
Key tips:
- Federal loans are 0% interest — focus on high-interest debt first
- Apply for RAP if income is low
- After 15 years on RAP = forgiveness
- Provincial loans may have interest — check yours
- Never ignore student loans — RAP protects you
- All payments go to principal at 0% rate