How do student loans work in Canada?

Student loans in Canada are available from the federal government and provincial governments as well as private lenders. If you need financial assistance to cover the cost of school, start by applying for government loans in your province or territory. Once you apply, your eligibility for any federal and provincial loans and grants can be assessed. If you need further assistance, you can also consider applying for private student loans or lines of credit. Many lenders offer lines of credit specifically designed for students, while you can also consider taking out a personal loan to cover education expenses.

How much student loan can you get in Canada?

The maximum amount you can borrow with a loan or line of credit from a private lender varies depending on the lender you choose. Higher limits are also available for students studying specific courses, such as medical and dental students. Federal government student loans can cover up to 60% of the cost of your tuition. Provincial student loan limits vary depending on where you live, so check the maximum amount with your local student aid organization.

What can I do if I'm struggling to repay my student loan?

The Government of Canada can help you pay off your government-issued student loan through the Repayment Assistance Plan (RAP). Eligibility is determined based on your income, and you may be able to qualify for reduced payments or no payments at all. Another option if you're struggling with student debt is to consider student loan refinancing to get a lower interest rate or better terms — check out our guide to student loan refinancing for more information.

Can I get a student loan with bad credit in Canada?

Government student loans tend to have lenient eligibility requirements, so it may be possible to get a federal or provincial student loan with bad credit. In many cases, you won't need to undergo a credit check to apply. On the other hand, private student loans in Canada from banks and credit unions have much more strict eligibility requirements. You may have an easier time getting approved for a student loan with bad credit if you can apply with a cosigner who has a higher income and credit score.

Can I get a private student loan without a cosigner?

You can if you meet your lender's credit requirements. Generally, you'll need to have good credit and a minimum income if you apply without a cosigner, which, unfortunately, is something most undergraduate students don't have.

How does refinancing a student loan affect my credit score?

Refinancing a student loan can actually improve your credit in the long run by adjusting your monthly repayments to something you're more likely to afford. However, it may damage your credit slightly in the short run because most lenders conduct a hard pull on your credit report during inquiry for the application process, which causes your score to temporarily dip around 5-10 points.

Will I get a grace period before I have to start repaying my student loan?

With government loans you'll get a grace period of six months before you have to start making repayments. For private loans, you'll typically need to start paying money back as soon as you take out your loan.

How to Get a Student Loan in Canada

Post-secondary education isn’t cheap — according to the federal government, on average you can expect tuition fees of between $2,500 and $11,400 a year. But if you need higher education to get the career you want, student loans can help cover the cost of school.

In this guide, we’ll walk you through your student loan options, including government and private student loans in Canada. We’ll also show you how to find the best student loan for your needs.

Where can I get a student loan?

There are four places you can get student loans in Canada.

Federal government

The Government of Canada offers student financial assistance under the Canada Student Loans Program. Loans are available for full- and part-time students, with eligibility determined based on financial need. You can access funding to cover up to 60% of your tuition costs.

As of April 1, 2023, federal government student loans no longer accrue interest, but you’ll need to start repaying what you borrow six months after you graduate or finish studying.

Provincial government

Provincial and territorial governments across Canada also offer their own student financial assistance programs. Loan amounts and terms vary depending on where you live, but you’ll need to be studying at least 60% of a full-time course load to be considered a full-time student.

Financial institutions

Once you’ve exhausted your options for government student aid, you can also consider taking out a private student loan. Banks and other major financial institutions across Canada commonly offer student lines of credit to help you cover the cost of tuition, books, housing and more. These provide access to a preapproved credit limit whenever you need funds, but you only pay interest on the money you use.

Alternatively, you could consider taking out a personal loan to cover the cost of education. Interest is typically higher (but not always) than with a government loan and starts accumulating as soon as you take money out. You’ll often have to start making payments on your loan from the moment it gets issued or after a grace period after your studies, depending on the lender.

Private lenders

Private lenders also offer student loans and lines of credit. These online lenders often have more lenient eligibility requirements than banks and credit unions, so it may be easier to qualify for funding. But high rates and fees often apply, so it’s important to be aware of the cost of borrowing before you apply.

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Government student loans by province

Province	Maximum amount	Eligibility requirements
Alberta	Lifetime loan limit for full-time students One Year Undergraduate Programs: $51,000 Undergraduate Programs of two years or more: $85,000 Dental Hygiene: $95,000 Pharmacy, Graduate Studies: $125,000 Law, Masters of Business Administration, Doctoral Studies: $150,000 Chiropractic Medicine, Dentistry, Medicine, Optometry, Veterinary Medicine: $200,000 Part-time students: $10,000	Alberta resident Canadian citizen or permanent resident (or have protected person status) Must have financial need to receive student aid Must be enrolled in an eligible school and program
British Columbia	$50,000	Canadian citizen, permanent resident or protected person status Have a valid SIN Resident of BC Enrolled in an eligible program of study at an eligible post-secondary institution Demonstrate financial need Make academic progress and achieve a satisfactory scholastic standing
Manitoba	Full-time students: $500 x the number of weeks in 1 program year Part-time students: $10,000	Canadian citizen, permanent resident or protected person Manitoba resident Studying at a designated school and program Not in default of previous federal or provincial student loan
New Brunswick	Full-time students: Up to $200 per week of study $10,000	Canadian citizen, permanent resident, protected person or registered under the Indian Act New Brunswick resident Have a financial need Enrolled in an approved degree, diploma or certificate program at least 12 weeks in length at an eligible post-secondary institution Maintain a satisfactory scholastic standard Not be in default on a previous student loan
Newfoundland and Labrador	$100 per week of study (Up to $135 per week for Memorial University medical students)	Canadian citizen, permanent resident, protected person status or registered as an Indian (under the Indian Act) Resident of Newfoundland and Labrador Valid SIN Have demonstrated financial need Not in default on previous federal and/or provincial student loans Full-time student at a designated institution Enrolled full-time in a program of study leading to a degree, diploma or certificate that is at least 12 weeks in duration Your period of study is at least six weeks in duration Must meet academic performance requirements to maintain eligibility
Nova Scotia	$200 a week	Enrolled in a designated program at a designated school Valid SIN Nova Scotia resident Canadian citizen, a landed immigrant or a protected person
Ontario	Full-time students Single student with no dependants: $510 a week Student who is married, in a common-law relationship or a sole support parent: $825 a week Part-time students $10,000	Ontario resident Canadian citizen, permanent resident or protected person Demonstrated financial need Meet academic progress requirements Must not have defaulted on a student loan or failed a credit check Valid SIN Studying at an approved college or university
Prince Edward Island	$209 per week of study	PEI resident Canadian citizen, permanent resident or protected person Valid SIN Full-time student at a designated post-secondary institution
Quebec	Full-time students: $30,000 – $70,000 for university study Part-time students: $8,000	Canadian citizen, permanent resident or have refugee or protected person status Quebec resident Enrolled in a recognized educational institution and program
Saskatchewan	Students in one-year and graduate programs: $198 per week Students in multiple-year certificate, diploma or undergraduate programs: $227 per week Medical students: $365 per week	Saskatchewan resident Canadian citizen, permanent resident or protected person Have financial need Enrolled at a designated school in an approved program Your previous student loans are in good standing

Bank student loans in Canada: Are you eligible?

Banks also offer financing solutions you can tap into as a student. While federal and provincial government loans typically offer a greater range of funding options designed especially for students, private student loans in Canada usually offer faster access to funds and are more flexible. However, it’s often harder to qualify for a bank loan as a student.

Many students haven’t yet built a strong credit history. Because lenders usually require you to be in steady employment, receive a minimum income and meet credit score requirements, you might want to bring on a parent as a cosigner. Alternatively, your parents might prefer taking out a personal loan in their own name.

You’ll need to meet common eligibility requirements that include:

Steady income
Good or excellent credit
A strong credit history
The age of majority in your province (18 or 19 years old)
Canadian citizen or permanent resident
Debt-to-income ratio (DTI) below 40%

Can you apply for private student loans in Canada?

Yes. If you don’t qualify for a government student loan or you still need extra funds, you can apply for funding from a bank, credit union or private lender.

If you already have a relationship with a bank or credit union, they’ll likely be your first port of call. If you can point to a long history of banking with the same institution, it may help you qualify for a loan.

Alternatively, you might like to apply for a loan from a private lender. These alternative lenders tend to have more lenient eligibility requirements, so it may be easier to qualify even with limited credit history. But you’ll need to watch out for high rates and fees, plus do your due diligence to make sure you’re dealing with a reputable lender.

There are two types of private student loans you might like to consider: student lines of credit and personal loans.

Related: Best personal loans in Canada

Student lines of credit

Many Canadian banks, including the Big Five, offer lines of credit specifically designed for students. Student lines of credit are commonly used as an alternative when you don’t qualify for government loans or you need more money to pay for school.

A line of credit is an amount you’re approved to borrow, and you can access funds up to a set limit whenever you need. For full-time students, amounts generally fall between $10,000-$20,000 per year. Higher credit limits are often available for medical and dental students or those engaged in professional graduate programs.

Line of credit interest rates are variable and are usually a small increment above the bank’s prime rate. You only pay interest on the money you actually use, but unlike with a government student loan, you’ll need to start making interest payments straight away. You’ll often also have the option to make interest-only payments while you’re still in school, then start paying off the principal after you graduate.

However, be aware that having a student line of credit could affect how much you’re eligible to receive from other sources like scholarships, bursaries and government loans.

Personal loans

You could also apply for a personal loan from a bank, credit union or private lender to cover education costs. Your options for personal loans may be limited if you’re still hitting the books and not bringing in much income. But many banks and lenders accept cosigners, which can help you qualify for a lower rate and better terms than you’d find on your own.

Personal loans typically range from $500 to $50,000. Interest rates vary based on your income, credit score, existing debt load and other factors. Terms generally last 3 to 60 months.

The main benefit of a personal loan is that there are no restrictions on what you can use the money for. But there are a few downsides to be aware of:

Requires an income (and/or a cosigner). Working while in school can be challenging. Plus, your income may be too low to apply without a cosigner with traditional lenders.
High rates. Personal loans usually have higher interest rates than government student loans. And as of April 1, 2023, federal government student loans no longer accrue interest.
Not designed for students. Unlike traditional student loans, you usually have to start paying back personal loans straight away.

Why is it difficult to get a personal loan as a student?

There are a few reasons why you might struggle to qualify for a personal loan as a student:

No credit. Unless you’ve taken out loans or credit cards before, you won’t have a credit history. This will make it harder to access private student loans in Canada since you can’t show the lender that you have a good track record of repaying your loans on time.
Low income. Most students don’t have much money coming in, which makes it difficult to meet a lender’s minimum income requirement.
Lack of assets. If you don’t have any assets to provide as collateral, you won’t be able to qualify for a secured loan. It can be much more difficult to get unsecured loans for large amounts.
Bad credit. If you’ve missed payments on previous loans or credit cards (especially if you have very little credit history), your credit score might be too low to qualify for a loan.

How to get a private student loan

It’s easy to apply for a private student loan online. You’ll need to provide details such as:

Your name and contact details
Your SIN
Proof of ID, such as a driver’s licence or passport
Income and employment information

If you’re applying for a student line of credit rather than a personal loan, you’ll also need to provide:

Proof of your enrollment in a course at an eligible educational institution
An estimate of your education costs
Information about your financial situation (such as RESPs, scholarships/bursaries and government loans that can be used to help cover your education expenses)

How much are student loans in Canada?

The maximum amount you can borrow varies depending on the type of loan you get.

Federal loans

Student loans from the Government of Canada provide a maximum of $300 per week of study. Full-time students can receive financial assistance for up to 340 weeks, but this limit increases to 400 weeks for students enrolled in doctoral studies and 520 weeks for students with a disability.

Provincial loans

Maximum loan amounts vary between provinces and depending on the type of course you are studying. Check the table higher up this page for details of the maximum loan amount in your province.

Lines of credit

Credit limits vary depending on the lender and the type of degree you’re studying. For example, a BMO Student Line of Credit offers access to up to $20,000 per year and a maximum of $80,000 over 4 years. Meanwhile, a BMO Professional Student Line of Credit offers from $1,000 up to $175,000 based on your degree, while a BMO Medical or Dental Student Line of Credit provides access to up to $350,000.

Personal loans

Loan limits vary depending on the lender and your financial situation. Amounts of up to $50,000 are available, but you may not qualify for this amount as a student. Applying with a cosigner or providing an asset as collateral could help you get a larger loan amount.

Other ways to get financing as a student

Grants. When you apply for student financial aid in your province or territory, you’ll also be assessed to find out whether you qualify for a federal or provincial student grant. Unlike a loan, a grant doesn’t have to be repaid. Eligibility is determined based on your financial need and total family income, and grants of up to $4,200 per year are available for full-time students.
Scholarships. Scholarships offer financial aid to help you pay for your education, and they’re awarded based on academic merit or other factors. They also don’t have to be repaid. Scholarships are offered by the federal government as well as individual educational institutions and organizations, so it’s worth researching what’s available.
Bursaries. A bursary is another form of student financial assistance that doesn’t need to be repaid. It’s typically offered based on financial need, so check whether your provincial government or other organizations offer bursaries you may be eligible for.

Bottom line

There are plenty of options for financial aid if you need help paying for school. Federal and provincial government student loans are the best place to start, but private student loans in Canada can also help you cover education expenses. Research your financial assistance options before deciding whether to apply for funding.

Frequently asked questions

Student loans in Canada are available from the federal government and provincial governments as well as private lenders. If you need financial assistance to cover the cost of school, start by applying for government loans in your province or territory. Once you apply, your eligibility for any federal and provincial loans and grants can be assessed.
If you need further assistance, you can also consider applying for private student loans or lines of credit. Many lenders offer lines of credit specifically designed for students, while you can also consider taking out a personal loan to cover education expenses.
The maximum amount you can borrow with a loan or line of credit from a private lender varies depending on the lender you choose. Higher limits are also available for students studying specific courses, such as medical and dental students.
Federal government student loans can cover up to 60% of the cost of your tuition. Provincial student loan limits vary depending on where you live, so check the maximum amount with your local student aid organization.
The Government of Canada can help you pay off your government-issued student loan through the Repayment Assistance Plan (RAP). Eligibility is determined based on your income, and you may be able to qualify for reduced payments or no payments at all. Another option if you're struggling with student debt is to consider student loan refinancing to get a lower interest rate or better terms — check out our guide to student loan refinancing for more information.
Government student loans tend to have lenient eligibility requirements, so it may be possible to get a federal or provincial student loan with bad credit. In many cases, you won't need to undergo a credit check to apply. On the other hand, private student loans in Canada from banks and credit unions have much more strict eligibility requirements. You may have an easier time getting approved for a student loan with bad credit if you can apply with a cosigner who has a higher income and credit score.
Refinancing a student loan can actually improve your credit in the long run by adjusting your monthly repayments to something you're more likely to afford. However, it may damage your credit slightly in the short run because most lenders conduct a hard pull on your credit report during inquiry for the application process, which causes your score to temporarily dip around 5-10 points.

Thank you for your feedback!

To make sure you get accurate and helpful information, this guide has been reviewed by Leanne Escobal, a member of Finder's Editorial Review Board.

Written by

Tim Falk

Writer

Tim Falk is a freelance writer for Finder. Over the course of his 15-year writing career, he has reported on a wide range of personal finance topics. Whether you're investing in stocks and ETFs, comparing savings accounts or choosing a credit card, Tim wants to make it easier for you to understand. When he’s not staring at his computer, you can usually find him exploring the great outdoors. See full bio

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