Don't Default... While You're Still In School

Avoid the cost - and hassle - of an accidental default while you're in school.

If you don't clear it up fast, you could find yourself blocked from future student loans - plus interest relief - even though you're still attending school.

Even if your lender is at fault and you're sure they'll sort it out eventually, you don't need this stress in the meantime.


Send in your confirmation of enrolment (Schedule 2) each term when you get your new loans.


Ten days later, check that your lenders (provincial and federal) actually processed your Schedule 2. You can usually do this just by calling the student loan service bureaus.


If you get any mail from the bank or government, don't drop it in your backpack to read later. Read it now. Pay attention if it says something weird, such as you've `left school' or you're `a part-time student' when you're not. Tell them they've made a mistake because that letter may be the only warning you get before you're expected to start paying off your student loans.

For example, disabled students often get declared part-time even when they've carefully filled out all the medical and university forms that explain their lower course load. So don't just shake your head in disgust and forget about it. Act fast, so you don't get caught in red tape.


Make sure your lender has your correct address or you won't know about the weird mail. You can check this when you check that they've got your Schedule 2.

If you move a lot but keep in touch with your family, a stable family address is best.

What if the Worst Happens?

Okay, the four steps above have come too late for you. You're in trouble, either defaulted by accident or your loan has lost its good standing for some reason.

So pay the "missed" payments as fast as you can. Argue later.

If your lender is at fault, definitely you'll want to try for a refund. But that could end up taking months.

In the meantime, the wise thing is to pay. Get your loan into good standing asap, even if you have to sell stuff. It's worth it to keep your loans coming in, on time and interest-free.