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What Happens If You Cannot Pay Student Loan in Canada?

Updated

If you cannot pay your student loan, do not ignore it. Arrears can grow and credit damage can follow, but support programs can reduce payments.

What may happen

  1. Missed payment and account delinquency.
  2. Credit reporting after sustained non-payment.
  3. Collection activity if default continues.

Best first action

Apply for Repayment Assistance Plan as soon as possible. Many borrowers qualify for reduced payments based on income.

Other options

  • Interest relief and temporary hardship measures.
  • Budget restructuring and debt prioritization.
  • Provincial program checks (rules vary).