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marriedwithdebt View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote marriedwithdebt Quote  Post ReplyReply Direct Link To This Post Posted: 25/May/2010 at 10:54am
I had to double check! Accordng to this, my reduced monthly payments go towards the principal and the government pays the interest...yay.
 
I've copied a section from the Canlearn website: http://www.canlearn.ca/eng/after/repaymentassistance/rpp.shtml
 
How does the Repayment Assistance Plan work?
Stage I: This stage applies to the first five years.
  • For five years student loan borrowers who qualify will make affordable payments (or no payment) toward their loan principal. Paying the student loan principal first reduces the total debt.
  • The Government of Canada will cover the interest amount owing that the borrower’s affordable payment does not cover.
  • Borrowers will not make payments exceeding 20 percent of their income towards student loans covered by the Repayment Assistance Plan.
  • Borrowers could be enrolled in this stage for up to 5 years during a 10 year period.
  • Check with your province or territory to find out if your provincial or territorial student loans are covered under the Repayment Assistance Plan.

Stage II: This stage is available for borrowers who continue to experience financial difficulty. It starts once the borrower completes Stage I, or has been in repayment for 10 years after they leave school or complete their studies.

  • The Government of Canada will continue to cover the interest and begin to cover a portion of the student loan principal amount (i.e. the difference between the affordable payment and the required payment).
  • The balance of the loan should be gradually paid off so that no student loan debt remains after 15 years of leaving school (or 10 years for borrowers with a permanent disability).
  • Throughout this period, the same eligibility criteria, application process and affordable payments as in Stage 1 will apply.

 

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old hippy View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote old hippy Quote  Post ReplyReply Direct Link To This Post Posted: 25/May/2010 at 3:44pm
I have hypothetical questions please..
 
Stage II:  If someone has been in repayment for 14 years and then applies for the RAP Stage II and meets the eligibility criteria, do they only have to pay for another year?  And then their student loan (whether paid off or not) is gone?  Is it possible for someone to apply for the RAP in their 14th year of repayment?
 
Just wondering how the balance of the loan could be "gradually paid off" in one year, if there is a significant balance?  Or would the student loan borrower HAVE TO be in Stage II for the remaining five years?  Which would make the "so that no student loan debt remains after 15 years of leaving school" untrue.
 
thanks
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Johnny View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Johnny Quote  Post ReplyReply Direct Link To This Post Posted: 26/May/2010 at 6:02am
I don't think the system could even answer this one too intelligently. LOL 
 
My interpretation is that if someone applies for it's assistance after being in a repayment plan that was made without the use of the RAP, the applicant would have to start with stage one and go through the motion upon qualification. In it's definition it does state that no student loan debt remains after 15 years of leaving school but this benefit only becomes available once engaged in the RAP. In other words that 15-year wait begins once you are on this program. If you were in ordinary repayment prior to it, the time that you were on the ordinary structure does not reduce the 15-year RAP term. It would be interesting to see stats (if there are any) that show the number of applicants and those actually on RAP.
 
Johnny
Solve Student Debt specializes in solutions for students and graduates in student loan default, and those at risk of defaulting.

solvestudentdebt.com
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fiona1985 View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote fiona1985 Quote  Post ReplyReply Direct Link To This Post Posted: 29/August/2011 at 3:44am
Originally posted by skepticgirl skepticgirl wrote:

I've been out of school since the spring of 2007 and I owe $ 76,000 in debt to the gov't.  I recently applied for the Repayment Assistance and they calculated that my affordable payments are about $ 325.00 per month as opposed to the $ 996.00 that I would be paying without the assistance.  That's great, however I am still concerned that they may change things in the future.   

i believe u'll be paying in accordance with what has been before the introduction of new changes. so don't worry about that.
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