Property/assets and student loan amounts

[muhgel]

Hi guys,

 

I know the topic of student loan amounts has been discussed - does anyone know how having a property (i barely put a dent to the mortgage though), a vehicle (probably worth no more than 8k at present value), and a decent salary will affect the eligibility of (BC) student loan? I'm reluctant to take out a bank line of credit without maximizing the student loan option...

 

any insights would be greatly appreciated!

 

thank you

[dnao2]

I am in a similar situation. With a down payment for a condo still in it's pre-construction phase, as well as some RRSP. I am in Ontario though. I tried the OSAP estimator the OSAP site provides and basically any of these types of assets prevent me from getting any funds unless I am willing to liquidate these assets. I don't think there's any way around it.

[rmorelan]

I am in a similar situation. With a down payment for a condo still in it's pre-construction phase, as well as some RRSP. I am in Ontario though. I tried the OSAP estimator the OSAP site provides and basically any of these types of assets prevent me from getting any funds unless I am willing to liquidate these assets. I don't think there's any way around it.

 

ahhh not is shouldn't be true - I have significant RRSP assets and a house - you are allowed 2K per year post highschool in your RRSP without triggering a reduction and your principle residency doesn't count either (unless there has been a radical change in the last year). I got FULL OSAP for my entire medical school duration.

[dnao2]

Thanks rmorelan! I recall the 2k/yr post high school limit and so I think I am safe in that regard. However, the condo is currently not my primary residence because it is not built yet. I am still living with my parents. In such a case, how do I define which is the primary residence at the time of OSAP application?

[muhgel]

thanks rmorelan and dnao! so i wont have to liquidate my asset, after all. just wondering what would a full OSAP look like? (I'm using it to benchmark BCSAP or NBSAP - to be honest I am not sure what my home province is anymore - and see how much Bank line of credit I would require to top up). rmorelan, greatly appreciated. feel free to pm me if you find this info sensitive and wish to discuss privately.

[rmorelan]

Thanks rmorelan! I recall the 2k/yr post high school limit and so I think I am safe in that regard. However, the condo is currently not my primary residence because it is not built yet. I am still living with my parents. In such a case, how do I define which is the primary residence at the time of OSAP application?

 

If it is the only property you own it is your primary residence for tax purposes. If you sell that condo you will pay no tax on it for instance - this isn't about where you live directly.

[rmorelan]

thanks rmorelan and dnao! so i wont have to liquidate my asset, after all. just wondering what would a full OSAP look like? (I'm using it to benchmark BCSAP or NBSAP - to be honest I am not sure what my home province is anymore - and see how much Bank line of credit I would require to top up). rmorelan, greatly appreciated. feel free to pm me if you find this info sensitive and wish to discuss privately.

 

No need to be private - the info is easy to compute from the OSAP calculator - just fill in no assets, no income etc to see what the max amount could be. In the ball park of 18K for a full standard year of medical school.

[schmitty]

I'm also in a similar situation...My wife and I own a condo and a car...the car is held against you for government loans, but your primary residence isn't. Having a spouse that works and makes anything middle-class-ish will GREATLY reduce your loans/grant amounts as in my case.

[rmorelan]

I'm also in a similar situation...My wife and I own a condo and a car...the car is held against you for government loans, but your primary residence isn't. Having a spouse that works and makes anything middle-class-ish will GREATLY reduce your loans/grant amounts as in my case.

 

unfortunately - there is definitely a socialized aspect to all this

[NutritionRunner]

I'm also in a similar situation...My wife and I own a condo and a car...the car is held against you for government loans, but your primary residence isn't. Having a spouse that works and makes anything middle-class-ish will GREATLY reduce your loans/grant amounts as in my case.

 

I don't get anything from OSAP. It sucks. All because my husband makes "too much" money. They don't take into account our mortgage, the loan for our second car, etc. We only bought a home in the first place because the mortgage payments are cheaper than rent would have been (for a smaller place at that)!

 

We have one vehicle paid off, but one we are still paying for. We need two vehicles as my husband commutes to Toronto for work, and I need to be able to get around Guelph for work, volunteering and school (and the one major downside to Guelph is the lousy bus service).

 

Anyhow, OSAP absolutely sucks for married individuals if your spouse makes a "decent" amount of money (ie. enough for both of you to live on while one of you goes to school).

[schmitty]

I don't get anything from OSAP. It sucks. All because my husband makes "too much" money. They don't take into account our mortgage, the loan for our second car, etc. We only bought a home in the first place because the mortgage payments are cheaper than rent would have been (for a smaller place at that)!

 

We have one vehicle paid off, but one we are still paying for. We need two vehicles as my husband commutes to Toronto for work, and I need to be able to get around Guelph for work, volunteering and school (and the one major downside to Guelph is the lousy bus service).

 

Anyhow, OSAP absolutely sucks for married individuals if your spouse makes a "decent" amount of money (ie. enough for both of you to live on while one of you goes to school).

 

Yup, I agree! Though, they don't count owning your house against you (mortgage or not).

[futureGP]

I don't get anything from OSAP. It sucks. All because my husband makes "too much" money. They don't take into account our mortgage, the loan for our second car, etc. We only bought a home in the first place because the mortgage payments are cheaper than rent would have been (for a smaller place at that)!

 

We have one vehicle paid off, but one we are still paying for. We need two vehicles as my husband commutes to Toronto for work, and I need to be able to get around Guelph for work, volunteering and school (and the one major downside to Guelph is the lousy bus service).

 

Anyhow, OSAP absolutely sucks for married individuals if your spouse makes a "decent" amount of money (ie. enough for both of you to live on while one of you goes to school).

 

that's actually unfortunate.

i also wouldn't be surprised if they count your mortgage as an asset not as a liability

 

edit: lol just realized schmitty said exactly the same thing

[rmorelan]

that's actually unfortunate.

i also wouldn't be surprised if they count your mortgage as an asset not as a liability

 

edit: lol just realized schmitty said exactly the same thing

 

The house is counted, not the mortgage. The problem is they are completely blind to all forms of debit and only count assets. You could owe 10 million but have 10,000 in the bank and they would consider you wealthy and reduce your OSAP.

[DoktaEvergreen]

Perhaps you guys can help me answer this but if my parents transfer a property to me under my name, and I live there for my duration of med school, will this reduce my OSAP amount as opposed to not transfering the property?

[muhgel]

I put in an application for student loan through Govt of NB - the application didnt ask much about assets, just the income of the last 18 weeks (which is enough to nail me in my head).. will hear in 4 weeks, definitely will share the outcome of the application. In the meantime I have decided to liquidate my asset here in NB and look to buy in BC, as nutritionrunner has pointed out, if rent = mortgage, then why rent? I think that's the perks of being a bit older and having worked for a few years already.

 

as for student loan, the max allowance here is about 64k, which is pretty substantial. If 1/3 of that can be applied as tax credits, I would hate to lose out on it.

 

thanks everyone

[rmorelan]

Perhaps you guys can help me answer this but if my parents transfer a property to me under my name, and I live there for my duration of med school, will this reduce my OSAP amount as opposed to not transfering the property?

 

If that house is now your principal residency (which it would be) under current OSAP rules it will not be held against you. Some RRSP amounts and your principal residency are the two major assets not considered with OSAP to reduce your overall amount.

 

However it may be for the sake of bursaries and other school funding.

[cheech10]

as for student loan, the max allowance here is about 64k, which is pretty substantial. If 1/3 of that can be applied as tax credits, I would hate to lose out on it.

 

The tax deduction is only 16% (approx) of the interest paid on the loan, not 33% of the loan amount. A 5% interest rate gives $3200 in interest, and you would save about $500 in tax. Not as much as you think.

[muhgel]

The tax deduction is only 16% (approx) of the interest paid on the loan, not 33% of the loan amount. A 5% interest rate gives $3200 in interest, and you would save about $500 in tax. Not as much as you think.

 

thanks for clarifying!