Student loans are a very common topic of conversation in my line of work. If you have some general questions about student loans and bankruptcy, you might want to read this article first.
I was reading in the Waterloo Region Record this past weekend about changes to the Ontario student loan system that are designed to adjust a person’s student loan payments to his or her ability to pay. Here is a link to the article in the Waterloo Region Record.
This change is touted by John Milloy, MPP for Kitchener Centre and Minister of Training, Colleges and Universities, as “part of a wider plan to have as many people as possible take advantage of college, university and apprenticeship programs.”
The idea is that the government will assess your finances after you have graduated and determine how much you are able to pay on a monthly basis. Furthermore, the interest will be paid by the government for low income students and the entire loan can be forgiven after 15 years.
This is potentially very good news for young people starting on their post-secondary education, or people who are looking to go back to school for re-training. However, like many things associated with government, the announcement is short on details.
I had a variety of questions. Here are a few:
- When will this change be implemented?
- Does it apply to existing loans?
- What is considered “low income?”
- How will this government assessment process work?
I scanned through the announcement on the website for the Ontario Ministry of Training, Colleges and Universities. The part about repayment appears in three short lines part way down the page. No answers there. I poked through the links provided, still no luck. I think that this is the official news release. I don’t see any mention of the repayment plans at all.
What does this all mean? Unfortunately, the answer is I don’t know (yet).
Student loans are unique. The government lends you money at a time when you have no ability to repay it. The idea is that you increase your education, find employment in your field and are able to repay the loans. Unfortunately, it does not work out that way for many people.
My job is to provide information to people who find themselves in financial difficulty. If you find yourself struggling with your student debts, feel free to give me a call at 310-PLAN (that’s 310-7526 with no area code) to review your options. You can also send me your questions by e-mail.
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