4.4.6 The time and cost to repay student loans

From: Financial Consumer Agency of Canada

The answers depend on how large a loan you have borrowed and how quickly you repay it.

Here is an example showing two different payment plans. In both cases, assume that you graduate with a total student debt of $25,000 and that you start repaying your loan right away.

  • In Option 1, you choose a fixed interest rate (8.0 percent) and repay the loan within five years.
  • In Option 2, you choose a variable interest rate (averaging 5.5 percent) and repay the loan within 10 years.

$25,000 student loan

Option 1
Fixed rate of 8.0% for 5 years

Option 2
Variable rate averaging 5.5% for 10 years

Interest rate



Amount of each monthly payment



Total interest payable over the life of your loan



Total cost of your loan



If you find that you have trouble repaying your student loan, contact your loan officer as early as possible. Student loans in Canada are not automatically discharged in a bankruptcy or consumer proposal unless they are over seven years old.

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