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How to Pay Back OSAP After Graduating

How to Pay Back OSAP After Graduating

The completion of your post-secondary education is an accomplishment that ought to be celebrated, but for many people, it also comes with a significant amount of student debt. In this article, we will discuss how to repay OSAP after graduating.

What Does OSAP Stand For?

The Ontario Student Assistance Program, known as OSAP, is a program created to assist students in the province of Ontario in financing their post-secondary education.

There are two categories of funding available through OSAP: grant and loan. Your application will assist in calculating both the grant and loan portions of your financial assistance, but you may not have to take out the loan if you believe the grant will be adequate to cover your educational expenses. You have the option of using your OSAP funds to cover tuition, textbooks, school fees, housing, and child care.

What Part of OSAP Do You Owe?

When you get the money from OSAP, you have the option to take out the loan part, which is typically the only part you have to pay back. If you do take out the loan, you will have to pay it back. If you received funding in the amount of $20,000 but only $15,000 of that was in the form of a loan, then the amount that you are responsible for repaying is $15,000 only (with interest).

When Does OSAP Repayment Begin?

After completing your course of study, you have six months to begin repaying your OSAP funds. This means that if you graduated in April, you will be making your first payment in October.

In addition, you should be aware that because OSAP is a government aid program, your contributions do not go directly to OSAP; rather, they are sent through the NSLSC (National Student Loan Service Center).

What if You Want to Return to School?

What if You Want to Return to School

You will not be required to begin the repayment process if you intend to return to school for the subsequent academic term. This is provided that your school is able to verify your enrollment and that you are either accepted for full-time OSAP funding once more or the Continuation of Interest-Free Status Program.

For instance, if you have decided to go back to college or university after you graduate, you can reapply for OSAP instead of paying back your loans at the six-month mark.

When you go back to school and are given permission to receive more OSAP money, the interest on your loans will cease accruing, and you won’t have to make any payments toward them until you either graduate or quit attending school full-time for the second time. It is always a good idea to get in touch with the financial advisor at your school to get more information.

How to Pay Back OSAP After Graduating

If you are provided with all of the information you require, the process of repaying the OSAP funding you received is straightforward. Follow these five steps to get out of student loan debt.

Create A Plan

You are required to have either completed your program of study or stopped attending full-time classes before you can begin making repayments on your OSAP loan.

Even though you are exempt from making payments on your student loans during the six-month grace period that follows graduation or leaving school, interest continues to accumulate on your balance during this time.

If you are not already doing so, you should start looking for employment — whether it is a full-time job, a part-time job, or a side business, any money you can bring in would be quite helpful. Plan ahead to ensure easy repayment.

Estimate Monthly Payments

The interest rate at the moment you begin repaying your student loans is used to compute your monthly payback amount. The federal and provincial governments each contribute their own portion of the OSAP loan, which results in two distinct interest rates.

The prime rate is 2.45%, whereas the Ontario rate is 3.45% as of 2022. Your OSAP interest rate will be an average of 2.75 percent if the federal government is responsible for 70 percent of your loans and the province is responsible for the remaining 30 percent of your loans.

For instance, if you owe $15,000 in student loans and the interest rate is 2.75 percent, you will be required to make payments of $153 a month in order to pay off the debt in 9.5 years. You can use the Repayment Calculator to do your estimation.

Although there is a possibility that the interest rate might change due to fluctuations in the prime rate, the amount that you will be required to pay each month will remain the same. Instead, the adjustment will reflect itself in your loan balance.

Now that you have an estimate of how much your monthly payment will be, you can create a budget that takes this number into account and start putting it away with each paycheck.

Sign in to Your NSLSC Account

Either use a sign-in partner, such as your bank, to access your account, or enter your login details to access it.

You will be able to access the status of your loan and make any necessary changes to your contact information by logging into your account. You can use it to seek assistance with your repayments as well as to request adjustments to the conditions of your repayments, like a payment extension.

Your Payback Package will be Sent to You

You can expect to get a package from the NSLSC within the grace period of six months that you have been granted. This package will provide you with information regarding the total number of payments you will be required to make, the date on which you will be required to make your first payment, as well as the interest rates that will apply to your loan.

Start Paying the Loan

Start Paying the Loan

When the grace period of six months has passed, it will be time for you to begin making payments on your loan. Keep in mind that the payments for your OSAP loan will be from your NSLSC account and not from your OSAP account.

Sign into your NSLSC account, and select the form of payment you wish to use. Using a method of payment like a pre-authorized debit is a fantastic way to guarantee that all of your repayments will be made on time. 

On the other hand, you also have the option to sign into your account on a regular basis and make one-time payments using the information from your banking institution. By increasing the amount of money you send in each time, you’ll be able to knock off your debt more quickly.

Your repayment plan is based on an average time frame of 9.5 years because that is the typical amount of time required to pay off an entire OSAP loan. Your payments will be calculated based on this timeframe. If you need additional time, you can lengthen this timeframe in your NSLSC account for up to 14.5 years. Once you’ve made all of your payments, the NSLSC will send you a notice certifying that you are free of your student loan debt.


You can register for the Repayment Assistance Plan (RAP) via your NSLSC account if you’re having problems with the repayment of your OSAP loan. Also, if you are already confused as regards making payments, you can reach out to our financial experts at EmpireOne Credit to guide you on how to be debt free quickly and start building your financial future. Consultation is free and friendly.

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