Repayment Assistance Plan
Income-based payment relief for eligible government student loans.
Learn more Canadian debt relief comparison and education
Student Loan Debt Help Canada
Student loan debt help in Canada repayment assistance and insolvency options
Understand Repayment Assistance Plan, payment relief, collections, consumer proposals, bankruptcy and the seven-year insolvency rule for student debt.
MoneyMatch provides educational comparison information. It is not a law firm, credit counselling agency or Licensed Insolvency Trustee and does not provide legal advice.
MONEY MATCH
Student Loan Debt Help CanadaCompare the path
PaymentCompare
Total costCompare
ImpactCompare
Know who regulates the option before you sign
Compare long-term consequences
Student loan debt has special insolvency rules
Government student loans are treated differently from ordinary unsecured debts. In general, the seven-year rule can affect whether student loan debt is released in a consumer proposal or bankruptcy.
Compare payment relief
Make sure the payment is sustainable.
Compare total repayment
Interest, fees and principal can differ.
Know the legal effect
Formal and informal options are different.
Understand credit impact
Relief can have long-term consequences.
Quick answer
What can you do if you cannot afford student loan payments?
For government student loans, the Repayment Assistance Plan may reduce or eliminate required payments based on income and family size. If the debt is older and insolvency is involved, special legal rules can affect whether student loans are discharged.
Student loan debt has special insolvency rules
Government student loans are treated differently from ordinary unsecured debts. In general, the seven-year rule can affect whether student loan debt is released in a consumer proposal or bankruptcy.
AffordabilityCan you sustain the payment?
Legal effectKnow what creditors are bound by.
Long-term impactCompare credit, assets and total repayment.
Compare options
Compare the main paths
Different solutions change payment, cost and legal status in different ways.
Payment arrangement
Work with the loan administrator or collections office.
Learn moreConsumer proposal
Formal insolvency process.
Learn moreBankruptcy
Formal insolvency process.
Learn moreWho it suits
When this path may—or may not—fit
May fit when
- You have government student loans and reduced income.
- You can apply for RAP.
- You have other unsecured debts as well.
- Your study-end date may satisfy the insolvency discharge rule.
Look more closely when
- You assume all student loans are automatically discharged in insolvency.
- You ignore loan-servicer notices.
- You miss RAP renewals.
- You confuse private student lines of credit with government student loans.
What to compare
Key factors before you commit
Payment relief is only one part of the decision.
RAP
Can reduce required payments based on income and family size.
Renewal
Repayment Assistance Plan generally requires periodic reapplication.
Government vs private debt
Private student credit follows different rules from government student loans.
Seven-year rule
Government student loan discharge in insolvency generally depends on time since ceasing to be a student.
Hardship provision
A court application may be available after five years in limited hardship circumstances.
Collections
Defaulted government loans can be transferred to collection processes.
Compare before you commit
Understand the debt relief path before signing
Compare payment relief, total repayment, legal status and long-term consequences.
Decision checklist
Student loan debt checklist
Use the same questions for every solution you consider.
Loan typeGovernment student loan or private credit.
Study-end dateCritical for insolvency rules.
RAP eligibilityApply before missing payments where possible.
Other debtCompare the full debt picture, not the student loan alone.
How to choose
A practical decision process
1. Identify every student debt
Separate government loans from private credit.
2. Check RAP eligibility
Use income-based assistance where available.
3. Keep records of your study-end date
It matters for insolvency treatment.
4. Address collections early
Do not ignore default notices.
5. Get insolvency advice if necessary
An LIT can explain the seven-year rule and broader debt options.
Pros and cons
Potential benefits and trade-offs
Benefits
- RAP can reduce payments without formal insolvency.
- Government assistance can respond to low income.
- Formal insolvency can address other unsecured debts.
- Older student loans may be dischargeable when legal timing rules are met.
Trade-offs
- RAP requires eligibility and renewal.
- Student loans have special insolvency rules.
- Recent government student debt may survive insolvency.
- Collections can complicate repayment and future access to aid.
How MoneyMatch compares debt relief
Immediate payment relief and long-term consequences both matter
We explain student-loan debt relief by separating government assistance programs from insolvency rules and by distinguishing government student loans from private student credit.
Affordability
We consider whether the payment is realistically sustainable.
Legal and financial impact
We distinguish voluntary repayment arrangements from formal insolvency proceedings.
Provider and regulation
We identify the roles of lenders, counsellors and Licensed Insolvency Trustees.
Author: Money Match Canada · Coverage: Canada · Updated September 6, 2026
Disclosure: MoneyMatch Canada may receive compensation from some financial services providers or partners. Compensation does not guarantee placement, approval, debt reduction or a specific outcome. This content is educational and is not legal advice.
Frequently asked questions
Student Loan Debt Help Canada: common questions
What is the Repayment Assistance Plan?
RAP is a government program that can reduce or eliminate required student loan payments for eligible borrowers based on income and family size.
Can student loans be included in a consumer proposal?
They can be listed, but whether government student loan debt is legally released depends on special insolvency timing rules.
What is the seven-year rule for student loans?
In general, government student loan debt may be discharged in insolvency when at least seven years have passed since you ceased to be a full- or part-time student, subject to the legal rules.
Is there any hardship exception before seven years?
A court application may be available after five years in limited hardship circumstances.
Are private student lines of credit treated the same as government student loans?
No. Private student credit generally follows ordinary unsecured-debt rules rather than the special government student-loan insolvency provisions.
Compare before you commit
Use repayment assistance first and understand the special insolvency timing rules
Government student loans are not treated exactly like ordinary unsecured debt.
MoneyMatch does not guarantee debt reduction, creditor acceptance, loan approval, proposal acceptance, bankruptcy outcomes or credit-score results.