Stargaze Posted March 11, 2013 Report Share Posted March 11, 2013 Hi guys, Do you know if we have to start re-paying our student loans ( e.g. OSAP) during residency? Or can we apply for interest free status during residency? Thanks! Link to comment Share on other sites More sharing options...
holiday1001 Posted March 11, 2013 Report Share Posted March 11, 2013 yes you have to pay your interest on OSAP. for your LOC, no you don't have to pay the principal, just interest as always. so typically you'd shift your OSAP to your LOC. for Ontario, you can apply to the residency interest relief- no interest in return for a certain number of years of return of service (3? 5? I forget now) do correct me if I'm mistaken! Link to comment Share on other sites More sharing options...
NLengr Posted March 11, 2013 Report Share Posted March 11, 2013 yes you have to pay your interest on OSAP. for your LOC, no you don't have to pay the principal, just interest as always. so typically you'd shift your OSAP to your LOC. for Ontario, you can apply to the residency interest relief- no interest in return for a certain number of years of return of service (3? 5? I forget now) do correct me if I'm mistaken! For the interest relief, Ontario pay the INTEREST only on your govt loan during residency. You get saddled with a 5 year ROS. It's the worst incentive deal ever. For like 10k or less you are signing 5 years away of servitude. You'll make that in 2 weeks as staff. You'd be an idiot to restrict yourself for so little. Link to comment Share on other sites More sharing options...
Jochi1543 Posted March 11, 2013 Report Share Posted March 11, 2013 Yeah, ROS is only worth it if you already want to go to that place. Some government programs just make me wonder. I have a lot of debt, and even so, my LOC interest payments are under $400/month, so easily manageable on a resident salary. My govt debt is significantly less overall, so even with the higher interest rate, the payment would be quite a bit less than that. Link to comment Share on other sites More sharing options...
rmorelan Posted March 11, 2013 Report Share Posted March 11, 2013 For the interest relief, Ontario pay the INTEREST only on your govt loan during residency. You get saddled with a 5 year ROS. It's the worst incentive deal ever. For like 10k or less you are signing 5 years away of servitude. You'll make that in 2 weeks as staff. You'd be an idiot to restrict yourself for so little. unless you are sure you are in fact already going to go there. On the flip side you can break the contract for less than 4K - you just have to repay the interest and there is an admin fee. When you look at it that way the deal might be better, i.e. say if there is a 70% (I just made that up) you will remain in Ontario anyway then there is a 70% chance you will save you OSAP interest - often we get max OSAP for 4 med school years plus any UG, Grad loans before so even moving that to your LOC 10K can be a low ball estimate of the interest in 5 years even with our insanely low interest rates. It definitely works for some, but you are right you have to be very careful about the loss of flexibility The Link to comment Share on other sites More sharing options...
rmorelan Posted March 11, 2013 Report Share Posted March 11, 2013 Hi guys, Do you know if we have to start re-paying our student loans ( e.g. OSAP) during residency? Or can we apply for interest free status during residency? Thanks! and you definitely do start both principle and interest repayment in residency without that interest relief. Residency is just a job after all - you aren't a full time student anymore according to the OSAP people. You don't HAVE to pay the interest on the LOC either during residency. Some people I know just pretend the LOC doesn't exist or even add to it in residency. Scotia actually increases your LOC in residency by 15K a year to give you more room, while the other banks often have enough room you can just let it grow interest without hitting your limit anyway. Whether you should do that of course is another matter - but some just avoid it until the "big paychecks" come later Link to comment Share on other sites More sharing options...
ellorie Posted March 11, 2013 Report Share Posted March 11, 2013 Is it the same deal with Canada student loans? I was under the impression that the federal ones may not rack up interest during residency. Link to comment Share on other sites More sharing options...
NLengr Posted March 11, 2013 Report Share Posted March 11, 2013 Is it the same deal with Canada student loans? I was under the impression that the federal ones may not rack up interest during residency. Oh no, they want their money. You can apply for interest only payments though. Link to comment Share on other sites More sharing options...
rmorelan Posted March 11, 2013 Report Share Posted March 11, 2013 Oh no, they want their money. You can apply for interest only payments though. yeah..I would never do that. I mean you can just put the loan on the LOC and have much lower interest rate and the most flexible repayment plan possible Link to comment Share on other sites More sharing options...
NLengr Posted March 11, 2013 Report Share Posted March 11, 2013 yeah..I would never do that. I mean you can just put the loan on the LOC and have much lower interest rate and the most flexible repayment plan possible You do lose the ability to claim student loans payments on your income tax though. You'd want to do the math on what saves you more depending on how much you owe. As for breaking the ROS, it's repaying the money paid PLUS a $4k "admin fee". They also don't comment on what happens if there is no job for you in Ontario when you are finished (ex. If you are a cardiac surgeon). Link to comment Share on other sites More sharing options...
rmorelan Posted March 11, 2013 Report Share Posted March 11, 2013 You do lose the ability to claim student loans payments on your income tax though. You'd want to do the math on what saves you more depending on how much you owe. As for breaking the ROS, it's repaying the money paid PLUS a $4k "admin fee". They also don't comment on what happens if there is no job for you in Ontario when you are finished (ex. If you are a cardiac surgeon). Sure but doing the math shows it almost never is better! you pay the loan back at prime + 2% vs a LOC at prime. You only get as a tax credit roughly 20% of the interest payment in real tax savings. That is 5% base loan interest and only get 0.8% of it back in tax for 4.2% effective interest. vs a LOC at 3% effective interest. Link to comment Share on other sites More sharing options...
ChemPetE Posted March 11, 2013 Report Share Posted March 11, 2013 Don't forget the federal government has announced a forgiveness program for up to 40k in student loans for (I think) Family Medicine graduates working in rural locations. I think it's usually best to talk to some sort of financial advisor/expert in these situations though so you can optimize your credit to your personal situation anyways. Link to comment Share on other sites More sharing options...
Real Beef Posted March 12, 2013 Report Share Posted March 12, 2013 Don't forget the federal government has announced a forgiveness program for up to 40k in student loans for (I think) Family Medicine graduates working in rural locations. I think it's usually best to talk to some sort of financial advisor/expert in these situations though so you can optimize your credit to your personal situation anyways. Do you have a link to this? I have anecdotally heard about this as well but besides a small press release I have not heard anymore about this. Beef Link to comment Share on other sites More sharing options...
rmorelan Posted March 12, 2013 Report Share Posted March 12, 2013 Do you have a link to this? I have anecdotally heard about this as well but besides a small press release I have not heard anymore about this. Beef http://www.canlearn.ca/eng/after/forgiveness/index.shtml (?) Link to comment Share on other sites More sharing options...
youngdad Posted March 12, 2013 Report Share Posted March 12, 2013 Provincial govt's also have reimbursement programs for the provincial component of loans. BC's is pretty sweet. No interest accrual or payments due during the year worked and at the end of the year 1/3 of the total is paid off. 3 years all paid off! Link to comment Share on other sites More sharing options...
NLengr Posted March 12, 2013 Report Share Posted March 12, 2013 Provincial govt's also have reimbursement programs for the provincial component of loans. BC's is pretty sweet. No interest accrual or payments due during the year worked and at the end of the year 1/3 of the total is paid off. 3 years all paid off! NL just doesn't charge interest on the provincial component. Ever. Link to comment Share on other sites More sharing options...
ellorie Posted March 12, 2013 Report Share Posted March 12, 2013 The provincial portion of Alberta student loans does not accumulate interest during residency, at least. Hooray for that! Link to comment Share on other sites More sharing options...
Lightform Posted March 12, 2013 Report Share Posted March 12, 2013 For Quebec, the student loan isn't repayable until the end of residency (the government will continue to pay the interest on the loan during your residency). Link to comment Share on other sites More sharing options...
AnxiousBoy Posted March 12, 2013 Report Share Posted March 12, 2013 http://www.canlearn.ca/eng/after/forgiveness/index.shtml (?) The program says that residents are eligible after 400 hours in a 12 month period. Since all FM programs require a rural component, does this mean every FM residents qualify for this program? Link to comment Share on other sites More sharing options...
holiday1001 Posted March 12, 2013 Report Share Posted March 12, 2013 the good people at MD financial can help us out I think Link to comment Share on other sites More sharing options...
youngdad Posted March 13, 2013 Report Share Posted March 13, 2013 The program says that residents are eligible after 400 hours in a 12 month period. Since all FM programs require a rural component, does this mean every FM residents qualify for this program? Interesting.... You could do 400 hours in 7-8 weeks. Or even less if lots of call. Link to comment Share on other sites More sharing options...
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