For graduates entering a job market with fewer well-paid, full-time jobs, loan payments can be crippling. Having to repay a few hundred dollars a month for a decade is delaying other milestones, such as buying a home or having children.
The government estimates the changes in the recent budget will save the average borrower $2,000, based on a $13,500 federal portion of the loan. A recent graduate with just under $28,000 in debt – including nearly $20,000 in federal loans, or 70 per cent – stands to save closer to $3,000.
“With the provincial government in British Columbia eliminating interest rates on student loans [in its February budget], we hope that the federal government and other provinces will consider this as a possibility,” she said. Vanessa Pummer, 21, graduates from University of Windsor’s business administration program this spring with $39,450 in OSAP debt – a figure that accounts for all of her tuition and some other costs,"mostly things like groceries and then some day-to-day things I needed that I couldn’t cover.” She has two part-time jobs in addition to her studies.
Mr. Hoyes, the insolvency trustee, estimates that about one in seven insolvencies involve student loans. Government-guaranteed student-loan debt is only automatically discharged in a bankruptcy if the borrower has been out of school for seven years – so by the time Mr. Hoyes meets with former students, they’ve been overwhelmed by debt for some time.
globeinvestor Is it the government's role to sooth financial anxiety?
globeinvestor WHY NOT GIVE THE CHILDREN OF TODAY HOPE FOR TOMORROW!!!!? FREE EDUCATION FOR ALL CANADIANS WHETHER TRADES UNIVERSITY COLLEGE ETC!! PUT CANADA'S YOUTH BACK TO WORK!! WIPE OUT ALL STUDENT DEBT!!