Understanding Your Student Loan

 Find answers to your questions about the loan process

Student Aid Alberta provides student financial aid to eligible students to attend post-secondary education. We are responsible for:

• processing your application for student loans
• determining your eligibility for financial aid
• issuing grant funding to eligible students and student loan agreements for both your Alberta and Canada student loan
• customer service relating to your financial aid through online services, email and telephone.

EDULINX administers Alberta student loans on behalf of Student Aid Alberta. They will process your student loan payment and manage your loan while you’re in school and during the repayment phase. They provide customer service relating to your Alberta student loan through interactive online services, email and telephone.

The National Student Loans Service Centre (NSLSC) is responsible for the same services on behalf of the federal government for your Canada student loans. They provide customer service relating to your Canada student loan through interactive online services, email and telephone.

 How do I get my student loan funds?

If you haven’t already applied, you may be able to use the online application. Alternatively, you can download a paper application.  Quick Tips is also a helpful guide for anyone completing the paper application. You only need submit one application to be considered for Alberta and Canada student loans and grants. Once you’ve been approved for funding, find out how to get your money.

If you provide your banking details with your completed and signed loan agreements, EDULINX and/or the National Student Loans Service Centre (NSLSC) will deposit your loan funding into your bank account. If you do not provide banking information, you will receive a cheque in the mail. You will also receive notification of the payment including:

• total amount paid
• amount sent to you
• amount sent to your school for tuition
• an up-to-date total balance owing for your student loan

If you already cashed an Alberta student loan agreement and provided your banking information, you won’t need to sign a new loan agreement and subsequent Alberta student loan funding may be automatically deposited in your bank account. 

 What are my responsibilities once I receive student loans?

Most students receive both Alberta and Canada student loans. Although you only applied using one application, these are separate loans with terms and you’ll need to make separate payments.

 Keeping Your Loans Interest Free While in School

To keep your loans interest free while you are in school, you’ll need to:

• confirm your enrolment in a post-secondary program of study
• keep your contact information up-to-date

 Confirm you are enrolled in a post-secondary program of study

Each time you return to school, you'll need to confirm your enrolment. If you apply for student aid and your enrolment is confirmed, your loans will automatically be interest-free. If you are enrolled but not receiving student aid, you need to complete a form to let us know. Visit Keeping Your Loans Interest Free to learn more about which forms are right for you. Making sure your loans stay interest free will save you money.

 Keep your contact information up to date

Let Student Aid Alberta, EDULINX, and/or the National Student Loans Service Centre know if your contact information has changed.

You can register and use convenient online services to update your personal information such as your address, phone number and email. Visit Student Aid Alberta Online Services to learn more.

 Each of your student loans has 3 stages:

• in study period
• grace period
• repayment period

 
The in study period refers to the time during which you are studying. You are not required to make any payments and your loan is interest free during this time.

The grace period is the six-month period that starts after each academic year-end date. This is a transition stage of the student loan life cycle. Payments are not required. While interest is not charged on your Alberta student loan, interest will start to accumulate on your Canada student loan. 

The repayment period is the time when you must repay your student loans. Repayment begins six months after you leave studies. In technical terms, this means the 1st day of the 7th month from your academic year-end date. Payments tend to be due near the end of the month, unless you asked for different payment dates.

  What is the grace period?

The grace period is a period of six months that starts after each academic year-end date. This is a transition stage of the student loan life cycle. For your Alberta student loans, you will not be charged interest and payments will not be required, however interest will begin to accumulate on your Canada student loans.

The following table illustrates how interest accumulates during the grace period on your Canada student loan.

How to calculate interest on your Canada student loan during grace period?

To determine daily interest charge,    balance of loan x interest rate = daily interest
                                                                                      365 days/year

Example:    $10, 500.00 X 5% = $1.44 daily interest   
                          365 days

Then, take the number of days in a typical 6 month grace period X daily interest
Example:       184 days in a grace period x $1.44 = $264.96 total interest owing

Total balance when repayment begins: $10,500.00 + $264.96 = $10,764.96

 How will I know if my loan is in grace period?

In the last month of your studies, EDULINX and National Student Loans Service Centre (NSLSC) will send you a letter advising you of your approaching academic year-end date and that your loan will be entering the grace period stage.

In the fourth month of your grace period, you will receive a letter from EDULINX and NSLSC explaining:
• the steps you should take to confirm your enrollment if you are returning to school
• your current balance and an overview of your repayment arrangement if you are not returning to school

 What do I need to do if I am returning to school?

When you return to school you need to confirm you are enrolled in a post-secondary program before the end of your six month grace period.
• If you do, accumulated interest on your Canada student loan will be waived.
• If you do not confirm enrollment, your student loans will enter repayment.

 Does interest accumulate during grace period if I am not returning to school?

Beginning August 1, 2012, Student Aid Alberta will not charge you interest on your Alberta student loans during the grace period. However, interest will begin to accumulate on your Canada student loans if you do not return to school. You have two options regarding payment of interest accumulated on your Canada student loans during the grace period.

1.  Pay this interest prior to your loans entering repayment.  You can choose to make: 

• a one-time lump sum payment prior to your loans entering repayment
• payments at any time throughout the grace period as the interest accumulates.

The benefits of paying the interest before you begin repayment is you can claim a 17% tax credit on this interest. This option may slightly reduce your monthly payment amount.

2.  Add the interest to the balance of your Canada student loan.

• This is done automatically if the interest is not paid when your loans enter repayment.
• You cannot claim the 17% tax credit on interest that is added to your loan balance.