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ontario regulation 254/14

made under the

Ministry of Training, Colleges and Universities Act

Made: September 17, 2014
Filed: December 8, 2014
Published on e-Laws: December 8, 2014
Printed in The Ontario Gazette: December 27, 2014


Amending O. Reg. 268/01

(PRESCRIBED FINANCIAL INSTITUTIONS AND ONTARIO STUDENT LOANS MADE AFTER JULY 31, 2001)

1. (1) The definition of “borrower” in subsection 2 (1) of Ontario Regulation 268/01 is revoked and the following substituted:

“borrower” means a person who has been issued a student loan under this Part and who is required to make repayments on the student loan under a consolidated loan agreement or under an arrangement established by the lender under section 29, but does not include a person whose student loan has been paid; (“emprunteur”)

(2) Subsection 2 (1) of the Regulation is amended by adding the following definition:

“prime rate”, with respect to a rate of interest, means the average variable reference rate of interest as calculated monthly, based upon the average variable reference rates of interest for a month, by each of the Bank of Montreal, the Bank of Nova Scotia, the Canadian Imperial Bank of Commerce, the Royal Bank of Canada and the Toronto Dominion Bank as their rate for Canadian dollar consumer demand loans, and calculated without reference to the highest and the lowest of those five rates and by averaging the remaining three rates; (“taux préférentiel”)

2. Paragraph 3 of section 12 of the Regulation is revoked and the following substituted:

3. The individual who, on the first day of the period of study, is the student’s spouse.

3. Section 17 of the Regulation is revoked and the following substituted:

Maximum amount of loan approved by a certificate

17. (1) This section sets out the maximum amount of a loan that may be approved by a certificate of loan approval issued to an individual for each week of the individual’s anticipated enrolment in the approved program of study for the period of study specified in the certificate.

(2) Subsections (1) and (2), as they read on December 7, 2014, continue to apply to certificates of loan approval issued for periods of study beginning before December 8, 2014.

(3) For a period of study that begins on or after December 8, 2014 but before August 1, 2015, the maximum weekly amount is,

(a) for a single student, $150; and

(b) for any other individual, $350.

(4) For a period of study that begins on or after August 1, 2015 but before August 1, 2016, the maximum weekly amount is,

(a) for a single student, $155; and

(b) for any other individual, $355.

(5) On August 1 of every year starting in 2016, the maximum weekly amount that applied immediately before August 1 shall be adjusted by multiplying the amount by the indexing factor to obtain the adjusted maximum weekly amount.

(6) For the purposes of subsection (5), the indexing factor is,

A/B

in which,

  “A” is the Ontario Consumer Price Index for all-items, not seasonally adjusted, for the 12-month period that ended on July 31 in the previous year, and

  “B” is the Ontario Consumer Price Index for all-items, not seasonally adjusted, for the 12-month period immediately preceding the period mentioned in the description of “A”.

(7) If the adjustment calculated under subsection (5) would result in an adjusted maximum weekly amount that is not a multiple of $5, the amount shall be rounded up or down to the nearest amount that is a multiple of $5.

(8) If the adjustment calculated under subsection (5) would result in a decrease in the maximum weekly amount, no adjustment shall be made.

(9) If the maximum weekly amount does not increase in a year due to a calculation under subsection (5) that would otherwise require a decrease in the maximum weekly amount, or due to the adjusted maximum weekly amount rounding down to the same amount as the previous maximum weekly amount, the indexing factor for the year shall be added to the indexing factor for the next year.

(10) In this section,

“single student” means an individual who does not have a spouse or dependent child on the first day of the period of study.

4. Subsection 24 (5) of the Regulation is amended by striking out “beginning on the date on which the service provider receives the confirmation of enrolment form” and substituting “beginning on the first day of the period of study”.

5. Subsection 25 (3) of the Regulation is amended by striking out “beginning on the date on which the service provider receives the confirmation of enrolment form” and substituting “beginning on the first day of the period of study”.

6. Subsection 30 (3) of the Regulation is revoked.

7. (1) Section 33 of the Regulation is amended by adding the following subsection:

(1.1) Despite subsection (1), this section does not apply in respect of student loans that have been successfully rehabilitated under section 42.5.

(2) Subsection 33 (4.1) of the Regulation is amended by adding “but before August 1, 2015” after “August 1, 2010” in the portion before the equation.

(3) Section 33 of the Regulation is amended by adding the following subsections:

(4.2) In the case of a 12-month period that begins on or after August 1, 2015, after the 12-month period expires, the principal amount of the loans given to the individual for all academic terms that began during the period is reduced by the amount, if any, greater than zero that is calculated using the formula,

(A + B) – (C × D)

in which,

  “A” is the total principal amount of the student loans that the individual received and was entitled to receive under the Act for all academic terms that began during the 12-month period,

  “B” is the total principal amount of the loans that the individual received and was entitled to receive under the

Canada Student Financial Assistance Act for all academic terms that began during the 12-month period,

  “C” is the number of academic terms that began during the 12-month period and in respect of which the individual received a student loan under the Act or a loan under the Canada Student Financial Assistance Act, and

  “D” is the amount calculated under subsection (4.3).

(4.3) The variable “D” in subsection (4.2) is the amount calculated using the formula,

(E + F) × G × 0.6

in which,

  “E” is the maximum weekly amount of a loan for a single student for the academic year, as calculated under section 17,

“F” is the maximum weekly amount of a federal student loan, as defined in section 35, for a single student for the academic year, and

  “G” is 17 weeks, which is the typical length of one academic term.

(4.4) If the amount calculated under subsection (4.3) is not a multiple of $50, the amount shall be rounded up or down to the nearest amount that is a multiple of $50.

(4) Subsection 33 (5) of the Regulation is amended by striking out “(3) and (4.1)” at the end and substituting “(3), (4.1) and (4.2)”.

(5) Subsection 33 (8) of the Regulation is amended by striking out “(2) and (4.1)” in the portion before clause (a) and substituting “(2), (4.1) and (4.2)”.

8. Section 34 of the Regulation is amended by striking out “under a consolidated loan agreement”.

9. Subsection 36 (1) of the Regulation is amended by striking out “under a consolidated loan agreement” and by striking out “under the agreement”.

10. Paragraph 3 of subsection 39 (1) of the Regulation is revoked.

11. (1) Clause 40.3 (1) (a) of the Regulation is amended by adding “or in the arrangement established by the lender under section 29” after “consolidated loan agreement”.

(2) Clause 40.3 (1) (b) of the Regulation is amended by adding “or arrangement established by the lender under section 29” after “consolidated loan agreement”.

(3) Subsection 40.3 (2) of the Regulation is revoked and the following substituted:

(2) At the end of the repayment assistance period, the suspension of repayment terms set out in the consolidated loan agreement or in the arrangement established by the lender under section 29 is lifted, subject to such amendments to the consolidated loan agreement or arrangement as may be agreed to by the parties.

12. (1) Subsection 40.4 (4) of the Regulation is amended by adding “or under the arrangement established by the lender under section 29” after “consolidated loan agreement”.

(2) Subsection 40.4 (7) of the Regulation is amended by striking out “under a consolidated loan agreement”.

(3) Subsection 40.4 (8) of the Regulation is revoked and the following substituted:

(8) If there is a conflict between this section and a provision of a consolidated loan agreement or the arrangement established by the lender under section 29, this section prevails.

13. (1) Clause 40.5 (2) (a) of the Regulation is amended by adding “or the arrangement established by the lender under section 29” after “consolidated loan agreement”.

(2) Clause 40.5 (2) (b) of the Regulation is amended by adding “or the arrangement established by the lender under section 29” after “consolidated loan agreement”.

14. Subsection 42 (3) of the Regulation is amended by adding “or an arrangement established by the lender under section 29” after “consolidated loan agreement” in the portion before clause (a).

15. The Regulation is amended by adding the following sections:

Loan Rehabilitation

Definitions

42.2 In sections 42.3 to 42.6,

“monthly rehabilitation payment” means the amount that an individual is required to pay on a monthly basis to rehabilitate a student loan, as determined under subsection 42.3 (3); (“versement mensuel de régularisation”)

“rehabilitation period” means the six-month period over which a student loan is to be rehabilitated. (“rehabilitation period”)

Application for rehabilitation

42.3 (1) An individual who has defaulted on his or her obligations to repay student loans and who wishes to make an attempt to rehabilitate the loans shall apply for loan rehabilitation in a form approved by the Minister.

(2) An individual who applied for loan rehabilitation will receive a payment schedule described in subsection (3), if the following conditions are satisfied:

1. The student loans were issued under this Regulation or under Regulation 774 of the Revised Regulations of Ontario, 1990 (Ontario Student Loans Made Before August 1, 2001) made under the Act.

2. Pursuant to a guarantee made under section 8 of the Act, the Government of Ontario paid the student loans and interest to the lender.

3. The amount of principal outstanding on the student loans is at least $600.

4. The individual has not previously made more than one attempt at rehabilitating the loans.

(3) The payment schedule shall indicate the amount of the individual’s monthly rehabilitation payment, which shall be equal to,

A + B

in which,

  “A” is the monthly amount calculated by amortizing the outstanding principal over 114 months at an interest rate equal to the prime rate as of the date of application plus 1 per cent, and

  “B” is the amount of interest in arrears as of the date of application divided by six.

(4) An individual who receives a payment schedule described in subsection (3) shall make six monthly rehabilitation payments, in accordance with the payment schedule, on or before the end of the rehabilitation period.

Suspension of rehabilitation

42.4 (1) The Minister may grant a temporary suspension of a rehabilitation attempt, whether or not the rehabilitation attempt has already failed and been terminated under section 42.5 if, in his or her opinion, the special circumstances of the individual justify the suspension.

(2) The suspension may be for such period of time as the Minister determines is appropriate, and a revised payment schedule setting out a revised rehabilitation period shall be provided to the individual.

(3) If a rehabilitation attempt fails and subsequently a suspension of the attempt is granted under subsection (1),

(a) the failure and termination of the attempt are deemed never to have occurred; and

(b) the suspension period is deemed to have started on the day of the failure and ends on the day specified by the Minister.

(4) When the suspension period ends, the rehabilitation attempt recommences on the same terms as applied before the suspension.

(5) An individual who receives a revised payment schedule described in subsection (2) shall make the required monthly rehabilitation payments, in accordance with the revised payment schedule, before the end of the revised rehabilitation period.

Rehabilitation attempt

42.5 (1) A rehabilitation attempt is considered to fail as follows:

1. The attempt is considered to fail on the first day that the individual is in arrears for two consecutive months on the obligation under subsection 42.3 (4) to make monthly rehabilitation payments.

2. If the individual’s rehabilitation attempt was suspended under section 42.4, the attempt is considered to fail on the first day after the recommencement of the attempt that the individual is in arrears for two consecutive months on the obligation under subsection 42.4 (5) to make monthly rehabilitation payments.

3. If, as of the last day of the rehabilitation period or the revised rehabilitation period, the individual has not made payments that, in total, are equal to the total of six monthly rehabilitation payments, the attempt is considered to fail on the day after the last day of the rehabilitation period or revised rehabilitation period.

(2) If an attempt at rehabilitating a student loan fails, the attempt is terminated and the loan cannot be rehabilitated unless the individual reapplies under subsection 42.3 (1).

(3) A rehabilitation attempt is considered to succeed if,

(a) the individual makes the monthly rehabilitation payments in accordance with subsection 42.3 (4) and, if applicable, subsection 42.4 (5);

(b) as of the last day of the rehabilitation period or revised rehabilitation period, the individual has made payments that, in total, are equal to the total of six monthly rehabilitation payments, and,

(i) the individual was not at any point during the rehabilitation period in arrears for two consecutive months on the obligation under subsection 42.3 (4) to make monthly rehabilitation payments, or

(ii) for a rehabilitation attempt that was suspended, the individual was not at any point after the recommencement of the attempt in arrears for two consecutive months on the obligation under subsection 42.4 (5) to make monthly rehabilitation payments.

(4) If a rehabilitation attempt succeeds, the rehabilitation is effective as of the day after the last day of the rehabilitation period or revised rehabilitation period.

(5) Subsection (4) applies even if the final payment is made before the last day of the rehabilitation period or revised rehabilitation period.

Effect of rehabilitation

42.6 Subject to subsection 33 (1.1), a student loan that has been successfully rehabilitated,

(a) is deemed to be a student loan issued by the Ontario Student Loan Trust under this Regulation and is subject to the terms and conditions normally applicable to such a loan; and

(b) shall otherwise be treated as if the default and rehabilitation had not occurred.

Commencement

16. This Regulation comes into force on the day it is filed.

 

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