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Paying for university?

A photo of prmly prmly
Hello everyone, I have a few questions concerning loans and things. Many of you are currently in university and have gone through this process so I'm looking for some insight.


I have around 25k in RESPs which my father's accountant says I can't take out until I've been in school for x amount of weeks (after being in school for x amount of weeks, I'm going to bring him a copy of my course schedule to prove I'm a full-time student, along with my proof of enrollment papers). He says I need to take out loans in the meantime. I'm applying for government loans through StudentAid BC (which is BC's equivalent to OSAP, I assume?) and to be honest, I don't think I'm getting much. My parents make 120k gross combined (although a hefty amount is taken from taxes), have around one million in assets, but are unwilling to contribute further than the 25k. I understand their reasoning -- they say they came to this country with nothing and worked for what they had and that I have to do the same. My father is also 60 years old and retiring soon and I don't really want to burden him with uni expenses. 25k seems like a lot, but I'm living on residence my first year and it will dwindle fast.


I've had a part-time job for a year but quit recently. I had around 1k saved up for school but Christ, graduation expenses were higher than I thought so now I don't have much in personal savings. I'm looking for a summer job to help offset the costs of school.


My other option is opting for bank loans and getting a student line of credit. How does getting a student line of credit differ from a government loans (assuming I do get some money out of StudentAid)? Will the interest be brutal? My parents are also unwilling to co-sign my loans so will that be a hindrance? Do I have to apply for the loans every semester? What bank do you suggest I go to?


Thanks in advance.
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A photo of Anonymous Anonymous
Student lines of credit usually accumulate interest while you're in school, whereas government-funded aid will be interest-free for the duration of your studies. You should consider holding a part-time job during the school year to offset the costs.
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A photo of g93 g93
Work ALL summer.
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A photo of LRooke LRooke
Looks like you're between a rock and a hard place. Is your family income high?
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A photo of prmly prmly

@LRooke wrote
Looks like you're between a rock and a hard place. Is your family income high?



120k gross combined. Net is something like 75k (maybe a bit more). The govt loan application only asked for gross income, though.
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A photo of ktel ktel
Unfortunately it's unlikely you will get any government loans. Which means you have to turn to bank loans, which will be probably impossible to get unless your parents cosign. You need to sit down and explain all of this to them. I can understand them not wanting to give any more money, but their income will prevent you from getting loans and if they won't cosign then you might be screwed.

Is it possible to go to a different university and live at home? In that case the $25,000 should get you through, although it would be tight.
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A photo of LRooke LRooke
I think you will get some amount of OSAP loans if you apply, probably something like 6K a year. I plugged in my numbers into the calculator and it said that I qualified for a 6K student loan, and my parents don't make that much more than yours.
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A photo of kiddinaround kiddinaround

@prmly wrote
Hello everyone, I have a few questions concerning loans and things. Many of you are currently in university and have gone through this process so I'm looking for some insight.


I have around 25k in RESPs which my father's accountant says I can't take out until I've been in school for x amount of weeks (after being in school for x amount of weeks, I'm going to bring him a copy of my course schedule to prove I'm a full-time student, along with my proof of enrollment papers). He says I need to take out loans in the meantime. I'm applying for government loans through StudentAid BC (which is BC's equivalent to OSAP, I assume?) and to be honest, I don't think I'm getting much. My parents make 120k gross combined (although a hefty amount is taken from taxes), have around one million in assets, but are unwilling to contribute further than the 25k. I understand their reasoning -- they say they came to this country with nothing and worked for what they had and that I have to do the same. My father is also 60 years old and retiring soon and I don't really want to burden him with uni expenses. 25k seems like a lot, but I'm living on residence my first year and it will dwindle fast.



My other option is opting for bank loans and getting a student line of credit. How does getting a student line of credit differ from a government loans (assuming I do get some money out of StudentAid)? Will the interest be brutal? My parents are also unwilling to co-sign my loans so will that be a hindrance? Do I have to apply for the loans every semester? What bank do you suggest I go to?




What bank are your RESPs with??? You DO NOT have to wait until after you start school to get access to your RESPs. My RESPs are with TD. Last summer (August I believe) I went to TD with my father with my student card, an invoice (something to prove tuition costs, basically a statement with tuition and residence costs) and my first year schedule to prove I was enrolled in classes, and they were able to issue me the maximum amount of money you are allowed to withdraw in 1st year right away (well it took 3 days or so). 1st year is going to be your most expensive year, so make sure you withdraw as much as they allow from your 25k. You can make more money with longer summers between 2nd, 3rd and 4th year. Speak with your father's accountant again, or just get your father to go to the bank with you with the appropriate forms and I'm sure you won't have an issue withdrawing your RESP funds. I suppose its not a huge deal, because you only have to make an installment to the university before you start anyway...

I can understand your parents wanting to teach you principle and the value of money, but you need to sit down and have a serious talk with them regarding loans and lines of credit. If I were you, I would ask your parents if you can negotiate some sort of line of credit with THEM, making promises to pay them back with a set level of interest, this is much less dangerous then dealing with a bank. (And this way, you could only borrow as much as you need for 1st year for example, because you might be able to cover future year costs from working in the summers). Make sure you know what current interest rates are (they are quite low at the moment).

Realistically, you could get a line of credit without your parents, but your interest rate would be higher. You should really try and convince them to sign because at the end of the day, the $40,000 you may need for University in total (plus your remianing RESP amount and future summer job income) would not be a serious liability for your parents to assist you with, if you were to default. It will be much less costly long-term to have your parents co-sign.

OSAP would be the best choice, if you get some, as the money is interest free while you are at school. A line of credit should be your last resort. Make as much as you can this summer and really try and budget how much you are going to need for the year, and be realistic.
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A photo of cosstickxx cosstickxx
First off, you only saved $1000... you should have known better..

As far as OSAP and bank loans go,

You don't have to start paying interest on OSAP until AFTER you graduate... although some people say they will charge mad interest at that point (im not sure on this though).

You will need your parents to co-sign for a line of credit. You pay your interest on them monthly (i do at least), about 10 bucks a month which isn't bad.
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A photo of Anonymous Anonymous

@cosstickxx wrote
You don't have to start paying interest on OSAP until AFTER you graduate... although some people say they will charge mad interest at that point (im not sure on this though).



OSAP is indifferent to when you graduate. Interest starts accumulating on your loans as soon as you stop being a full-time student. There is a grace period of six months before it sends you a request for payment - but note that interest will have already accumulated during those six months.
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A photo of VegaKrazmych VegaKrazmych

@g93 wrote
Work ALL summer.


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