Private Student Loan Refinancing
Refinancing is similar to consolidation in that you bring all your loans into one manageable loan. But refinancing is only done with private lenders the federal government doesnt offer student loan refinancing. That means youll lose federal loan protections when you refinance federal loans into a private one.
You can refinance both private and federal student loans together. Youll complete an application with a lender and detail all the current student loans you want to refinance. When youre approved, youll start making one monthly payment on your new loan to your new lender.
You should refinance if you:
- Have good or excellent credit and can secure a lower interest rate than what youre paying now.
- Have multiple loans with many different lenders, especially private loans.
- Can secure a lower monthly payment by stretching out your loan term.
You should avoid refinancing if you:
- Dont have strong enough credit to get a lower interest rate.
- Have federal loans that are eligible for an IDR plan or youre on track for PSLF.
- Want to keep federal protections and benefits, like deferment and forbearance, in case you experience financial hardship.
Who Pays For Student Loan Forgiveness
Many people oppose student loan forgiveness because it’s funded by taxpayers, and this is essentially true. Taxpayers have paid for your college education if the federal government forgives your student loans.
It’s the same as using government grants to fund your education. Private student loan forgiveness is pretty much nonexistent, but the banks’ other customers would end up funding them through fees and interest if private lenders were to offer these types of programs.
How To Find The Balance On Your Private Student Loans
Retrieving balances on private loans is a little trickier than finding information on federal loans. Theres no national website for private student loans like there is for federal loans. Also, the financial institution that originally issued the loan might outsource the loan servicing elsewhere or sell your loans to a different entity.
However, there are other ways to find your private loan balances:
- Ask your original lender : Your original lender is always the best place to begin this search. Hopefully, youve kept your original loan documents with the lenders contact information. One phone call should help you find your student loan balance and current servicer.
- Ask your school for help: If youre having trouble tracking down your loans, talk to your universitys financial aid office. They can help you identify who currently manages your debt.
- Check your credit report: Credit reports list all of your current and past credit obligations, including student loans. It will list the amount you borrowed and the loan servicer, which you can then contact to find the status of your account or to make payments. You can get a free credit report from the three main credit reporting agencies Experian, TransUnion and Equifax by visiting AnnualCreditReport.com.
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Become A Doctor Or Lawyer
Medical and legal professionals can end up with six figures in student loan debt. Fortunately, several student loan forgiveness programs exist to help them reduce their loan burdens:
- The National Institutes of Health repays up to $50,000 in student loan debt for medical students who complete certain types of medical research on topics such as medical disparities and contraception.
- Certain health professionals can receive up to $100,000 of student loan forgiveness through the National Health Service Corps Loan Repayment Program in exchange for two to three years of volunteer service at a clinic with a shortage of health professionals.
- Law school graduates may have some of their student loans forgiven by performing non-profit, public sector, or government work. The Department of Justice, the Legal Services Corporation, and several law schools offer student loan repayment programs. Lawyers may also qualify for the PSLF program, depending on where they work.
How Do I Find Out If I Owe Student Loans
Ask your school for help: If youre having trouble tracking down your loans, talk to your universitys financial aid office. They can help you identify who currently manages your debt. Check your credit report: Credit reports list all of your current and past credit obligations, including student loans.
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How Do I Check My Help Debt
Your myGov account will show you how much you owe and any repayments you have made.
If you don’t have a myGov account, you can set one up following the instructions on the ATO website or you can call the myGov helpdesk on 13 23 07 .
The myHELPbalance portal will show your available HELP balance .
myHELPbalance portal does not:
- show how much you owe,
- show loan fees or indexation on your debt, or
- include any debts incurred before 2005.
You will need your Commonwealth Higher Education Student Support Number , a student ID from any university, higher education provider or VET Student Loans provider you have studied at, and your first name, last name and date of birth to access myHELPbalance.
A CHESSN is a unique identifying number. It is important that you only have one CHESSN.
You can find your CHESSN on your Commonwealth Assistance Notice , given to you by your university or higher education provider or VET Student Loans provider.
If you can’t find your CAN or CHESSN, ask your provider.
Please note, if you have been given a provisional CHESSN by your provider, you will not be able to use a provisional CHESSN to access myHELPbalance. You will only be able to view your HELP balance once your provider has submitted your enrolment information to the Department, and the Department has verified that information, including your CHESSN. This may take up to two weeks after the census dates of units of study you are enrolled in.
Fixed Vs Floating Interest Rates
CIBC prime rate plus 2%
Prime rate of Canadian banks plus 2%
To compare the cost of choosing floating and fixed rates, use the Government of Canadas loan repayment estimator.
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Contact Your Schools Financial Aid Office
If you have federal loans that dont show up on the NSLDS, another option is to contact your schools financial aid office. The staff there can look up your past loan information, including what you originally borrowed and who the loan servicer was. With that information, you can contact the servicer to get your current loan balance.
Find Out How Much You Owe In Student Loans
When you took out your student loans, you agreed to borrow a set amount and to repay it with interest. Your interest rate can cause your loan balance to grow over time, so you could end up owing thousands more than you originally borrowed.
To make things even more confusing, your loans can sometimes change hands. Some lenders will sell your loans or transfer them to other loan servicers, so who you originally had as a loan servicer may no longer be the right one. Your loan servicer is who you make payments to and go to for questions, so its important to figure out who your current servicer is to repay your debt.
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How Much Student Loan Debt Do I Have
When youre ready to focus on your finances and gather information about your debts, one question that may come up is, how much do I owe in student loans?
If youve received student loan funds, you may have an idea of what you owe, but that does not give a full picture of your total debt. In most cases, interest accrues on the loan from the date you received the funds. Therefore, the total student loan balance is often higher due to interest being added.
To find out how much you owe in student loans, its good to know whether you have federal or private student loans. If you are unsure which you have, or you have both types, determining your student loan total will take a little more effort.
Unable To Repay Student Loans
If you cant pay the full amount due on time or have to miss a student loan payment, your loan may be considered delinquent and you may be charged late fees. Contact your loan servicer immediately for help, and ask them about your options.
Learn about COVID emergency relief for federal student loans that has been extended through January 31, 2022.
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How To Find Additional Student Loan Help
Legit student loan help organizations won’t call, text or email borrowers with offers of debt resolution. Avoid debt relief companies that promise immediate student loan forgiveness. If it sounds too good to be true, it usually is.
Here are some vetted student loan help resources to consider for information, advice or both they are established organizations with verified histories:
Student loan help resource
How Student Debt Affects Your Credit Score
Student loans and lines of credit form part of your credit history. If you miss or are late with your payments, it can affect your credit score.
Your credit score shows future lenders how risky it can be for them to lend you money. A poor credit score can also affect your ability to get a job, rent an apartment or get credit.
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What Happens Before Default
Before federal student loans default, they enter a status known as delinquency. Loans are considered delinquent as soon as you miss a payment, although your servicer wont report these late payments to credit bureaus until 90 days have passed.
Delinquent federal student loans are eligible for postponements and repayment plans that could make payments more affordable, such as income-driven repayment, deferment and forbearance. You cannot use these options once loans default, so contact your servicer immediately if you fall behind on your payments.
Many private lenders will help you catch up on payments by temporarily lowering your monthly payment or allowing you to pause repayment with a deferment or forbearance.
How Can I Clear My Student Loan Balance More Quickly
If you want to clear your student loan balance more quickly, you can make single extra payments directly to the SLC on top of the standard repayments you must make when your income is over the threshold amount for your repayment plan.
You can make these extra repayments at any time using your online account, by cheque or by bank transfer.
You also have the right to pay off your outstanding student loan balance in full at any time.
However, before choosing this route, make sure you have first considered how this will affect your financial wellbeing and whether there is another way to make better use of your money.
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How To Find Student Loan Balance For Private Loans
To find your private student loan balance, you may have to do a little more work since theres no centralized system for private loan information.
The first thing to check is your credit report. You can obtain a free credit report once every twelve months. The report will contain information about your loan providers, loan balance and payment history for loans.
This should provide a good start to determine the balances, although credit reports do have mistakes sometimes. If something seems inaccurate, try finding your original loan contracts, then follow up with the loan provider directly.
You can also check with your schools financial aid office for any information they have on loans you received.
Checking Your Federal Student Loan Balance If You Know Your Servicer
A student loan servicer is a company that takes care of the loan repayment process. Once you take out a federal student loan, they assign you to a servicer. Federal student loan servicers include the following companies:
If you know who your servicer is, you can contact them or go to their website and log in or create an account. You should then have access to all of your loan information, including the current balance.
If you do not know who your student loan servicer is, then you can find out by logging into the Federal Student Loan website, which is discussed in the next section and is another place you can find your loan balance.
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If You Don’t Repay Your Loans
If you don’t make your loan payments, you will be in default.
An OSAP loan is considered to be in default when no required payments have been made for 270 days.
Being in default means:
- your debt will be turned over to a collection agency
- you will be reported to a credit bureau
- you could be ineligible for further OSAP until the default is cleared
- your ability to get a car loan, mortgage or credit card can be affected
- your income tax refund and HST rebate can be withheld
- interest will continue to build up on the unpaid balance of your loan
Your OSAP debt will only be erased when you have paid it off in full.
National Student Loans Service Centre
You can find tools on the NSLSC website to help simplify and improve your repayment process. These include:
Pre-authorized debit: activate this option online to automatically make student loan payments every month.
Repayment notice: important information about your repayment terms, such as amount owing, repayment start date and repayment amount can be found by accessing the repayment notice feature online.
Virtual repayment counsellor: a virtual repayment counsellor can help you identify the best repayment path and ensure regular, timely loan repayments.
One-time payment: make lump-sum payments through the NSLSC website to accelerate repaying your loan.
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Log On Your Student Loan Account
The federal government outsources student loan management to several different companies, and you may have student loans with multiple providers. If you already know who your student loan servicers are, you can log on to their websites to view your total balance. The balance may be listed on your most recent statement or on the main dashboard.
If you’re having trouble finding the balance, contact the customer service department and ask them where to look.
Once you’re logged in, you can view your total balance. Your balance may change throughout the month if your loans are deferred, and the lender is still charging you interest during this time.
Finding How Much You Owe In Student Loans
Finding your student loan balance is important for a few reasons.
First, because of interest and fees, your current student loan balance may be higher than when you originally took out your loans if youre just starting to make payments. Knowing your current balance helps you shape your budget and determine whether you still have a good rate.
Its also possible that your lender the company that distributes and processes your loans has transferred or sold your loans to another lender. Keeping up with your student loan information helps you know where to send payments.
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Include Payments In Your Budget
Build your student debt payments into your budget and make payments that are larger than the minimum payments. You can also speak with your financial institution about setting up automatic payments.
When planning your budget and automatic payments, make sure you know when your payments are due. Remember that if you have more than one loan or line of credit, you may have more than one payment due date.
Student Lines Of Credit
If you have a student line of credit through your financial institution, you’ll have to pay the interest on the amount of money you borrow while youre still in school.
After you graduate, many financial institutions give you a 4 to 12-month grace period. During this time, you only have to pay the interest on your line of credit. After this period, youll pay back your debt through a repayment schedule agreed upon with your financial institution.
Contact your financial institution to get information about paying back your student line of credit.
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Repayment Assistance Plan Stages
The plan has two stages: interest relief and debt reduction.
1. Interest relief
The interest relief stage is available for up to 60 months, or until you are out of school for 10 years, whichever comes first.
During the interest relief stage
- your monthly affordable payment will first go toward paying down your loan principal
- if your payment is large enough, the remainder will go toward monthly interest
- the governments of Canada and Ontario cover all monthly interest that is not covered by your payment
If you are not required to make any payments at all during this stage, the governments of Canada and Ontario will cover your entire monthly interest charges and your loan principal would stay frozen.
Visit the National Student Loans Service Centre website to get more information.
2. Debt reduction
The debt reduction stage occurs after the interest relief stage, which is after you have received interest relief for a minimum of 60 months or you have been out of school for 10 years, whichever comes first.
During the debt reduction stage:
- you will make either no payments or a monthly affordable payment, depending on your income and family size
- your monthly affordable payment, if any, will go first toward paying down your loan principal
- if your payment is large enough, the remainder will go toward paying monthly interest
Visit the National Student Loans Service Centre website to get more information.