Direct Student Loan Regulations

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This consolidation is unofficial and is for reference only.  For the official version of the regulations, consult the original documents on file with the Registry of Regulations, or refer to the Royal Gazette Part II.
Regulations are amended frequently.  Please check the list of Regulations by Act to see if there are any recent amendments to these regulations filed with the Registry that are not yet included in this consolidation.
Although every effort has been made to ensure the accuracy of this electronic version, the Registry of Regulations assumes no responsibility for any discrepancies that may have resulted from reformatting.
This electronic version is copyright © 2010, Province of Nova Scotia, all rights reserved.  It is for your personal use and may not be copied for the purposes of resale in this or any other form.

Direct Student Loan Regulations

made under Section 81 of the

Finance Act

S.N.S. 2010, c. 2

O.I.C. 2008-404 (July 31, 2008, effective August 1, 2008), N.S. Reg. 342/2008


1     These regulations may be cited as the Direct Student Loan Regulations.


2     In these regulations,


                (a)    “Act” means the Finance Act, unless the context indicates otherwise;


                (b)    “borrower” means a qualifying student to whom a student loan is awarded;


                (c)    “designated educational institution” means an educational institution that is designated under the Canada Student Financial Assistance Act (Canada);


                (d)    “designated educational program” means an educational program that meets the eligibility requirements set out in Section 3 to qualify for student loans;


                (e)    “educational program” means a set of courses or studies that is considered by an educational institution to be necessary to obtain a degree, diploma or certificate from that educational institution;


                (f)    “full-time student” means a student in a designated educational program who is enrolled for one of the following:


                         (i)     at least 60% of a course load recognized by the educational institution as constituting a full course load,


                         (ii)    at least 40% of a course load recognized by the educational institution as constituting a full course load, in the case of a student who has a permanent disability,


                         (iii)   at least 20 hours per week in courses offered by a private career college;


                (g)    “loan year” means the period from August 1 in one year to July 31 in the next year;


                (h)    “Minister” means the Minister of Finance, or any person or persons authorized by the Minister to act on the Minister’s behalf;


                (i)     “partner” of a qualifying student means a person


                         (i)     who is married to the qualifying student,


                         (ii)    who is cohabiting and has cohabited for at least 12 consecutive months with the qualifying student in a conjugal relationship, or


                         (iii)   who is listed as the qualifying student’s common law partner on the qualifying student’s most recent income tax return;


                (j)     “period of study” means a period of study at a designated educational institution of at least 12 consecutive weeks in a loan year;


                (k)    “permanent disability” means a functional limitation caused by a physical or mental impairment that restricts a person’s ability to perform the daily activities necessary to participate in studies at a post-secondary level and that is expected to remain for the rest of the person’s life;


                (l)     “qualifying student” means a person who


                         (i)     is a Canadian citizen, a permanent resident, or a protected person within the meaning of the Immigration and Refugee Protection Act (Canada),


                         (ii)    is a resident of the Province as determined in accordance with Department of Education policies for student loan purposes, and


                         (iii)   is qualified for enrolment or is enrolled at a designated educational program;


                (m)   “student loan” means money loaned to a borrower by the Minister under Section 83B [80] of the Act and these regulations;

[Note: Cross-reference updated for regulations as continued under the Finance Act.]


                (n)    “student loan agreement” means an agreement under Section 9 between the Minister and a borrower for the grant of a student loan.

Eligibility requirements for designated educational program

3     An educational program that meets all of the following requirements is a designated educational program:


                (a)    it must be offered by a designated educational institution;


                (b)    it must be of at least 12 consecutive weeks in duration;


                (c)    it must be approved by the Minister of Education, or accredited by the Maritime Provinces Higher Education Commission or a national or international or other agency acceptable to the Minister of Education; and


                (d)    its student loan repayment rate must be at a level acceptable to the Minister of Education.

Application for designation as designated educational institution

4     (1)    A person may apply to the Minister of Education to designate an educational institution as a designated educational institution.


       (2)    An application for designation must be in a form approved by the Minister of Education and contain the information required by the Minister of Education.

Eligibility for student loan

5     (1)    To be eligible for a student loan, a qualifying student must establish, to the satisfaction of the Minister, that the qualifying student


                (a)    is or intends to be enrolled as a full-time student;


                (b)    requires financial assistance, taking into account the financial resources available to the qualifying student;


                (c)    has an academic history that the Minister considers acceptable for the purposes of granting a student loan.


       (2)    For the purposes of clause (1)(b), the financial resources of the qualifying student’s parent or partner may be considered to be available to the qualifying student.

Application for student loan

6     (1)    A qualifying student may apply to the Minister for a student loan.


       (2)    An application for a student loan must be in a form approved by the Minister and must include


                (a)    the qualifying student’s social insurance number; and


                (b)    any additional information required by the Minister.

Minister may declare qualifying student ineligible

7     Despite anything else in these regulations, the Minister may declare ineligible for a student loan a qualifying student who


                (a)    has ever provided to the Province or to the Government of Canada any false or misleading information that the Minister considers to materially affect or have materially affected the person’s eligibility to receive financial assistance from the Minister;


                (b)    fails to provide any information or documentation required by the Minister;


                (c)    is enrolled in an educational program that is not acceptable to the Minister.

Student loan for single period of study

8     A student loan must be in respect of a single period of study in a loan year.

Student loan agreement

9     (1)    The Minister may enter into a student loan agreement with a borrower.


       (2)    A student loan agreement must be in a form approved by the Minister and must incorporate terms and conditions substantially as set out in Schedule A, and any other terms and conditions approved by the Minister.

       (3)    A borrower must do all of the following


                (a)    sign a student loan agreement;


                (b)    sign any consents, authorizations and certificates required by the Minister;


                (c)    provide confirmation to the Minister of the borrower’s enrolment as a full-time student.


       (4)    A borrower younger than 19 years of age who enters into a student loan agreement is bound by that agreement, and these regulations apply as if the borrower were of full age at the time the contractual liability arose.

Purposes of student loan

10   A borrower must use a student loan to pay some or all of the following:


                (a)    tuition and other fees required by the designated educational institution;


                (b)    the cost of books, materials and supplies to be used in respect of the designated educational program;


                (c)    living and other expenses approved by the Minister.

Interest-free status

11   A borrower is not liable to pay interest and no interest accrues on their student loan


                (a)    during any period of study during which the borrower is a full-time student; or


                (b)    during any subsequent period ending on the last day of the 6-month period after the borrower ceases to be a full-time student.

Borrower must notify Minister of change

12   A borrower must notify the Minister of any change in the information contained in the borrower’s student loan application that occurs during the period of study referred to in the student loan agreement, including


                (a)    marital or family status;


                (b)    status as a full-time student; and


                (c)    financial resources.

Minister may require verification

13   At the request of the Minister, a borrower must provide any information or documents the Minister requires to verify statements made in the borrower’s student loan application or in any notice of change of status given by the borrower under Section 12.

Minister may reassess student loan application

14   The Minister may reassess the student loan application of a qualifying student or a borrower if


                (a)    the Minister receives information about the qualifying student or borrower that differs from the information provided with respect to the application; or


                (b)    an audit of the application reveals to the Minister information about the qualifying student or borrower that differs from the information provided with respect to the application.

Minister may terminate interest-free status or require repayment

15   The Minister may terminate a borrower’s interest-free status or require immediate repayment of a student loan in either of the following circumstances:


                (a)    the borrower or the borrower’s parent or partner has provided false or misleading information or documentation to the Minister;


                (b)    the borrower fails to comply with the Act or these regulations.

Borrower must repay amount refunded

16   If a designated educational institution refunds to a borrower all or part of the tuition or other fees for which the borrower received a student loan, the borrower must pay the refunded amount as a refund of money to the Province.

Appeal to Nova Scotia Student Aid Appeal Committee

17   (1)    A person who is dissatisfied with an award made with respect to their application for a student loan may appeal to the Nova Scotia Student Aid Appeal Committee established under the Student Aid Act.


       (2)    The Nova Scotia Student Aid Appeal Committee must review each appeal made under subsection (1) and recommend to the Minister that the award be confirmed, increased or decreased.

Schedule A

Terms and Conditions of Student Loans

(Section 83B[80] of the Finance Act and

Section 9 of the Direct Student Loan Regulations)


Interest rate:            The interest rate applicable to a student loan is either of the following, at the option of the borrower:


                                  (a)    the prime rate* plus 0.5% per year, or


                                  (b)    the prime rate in effect on the date the borrower is obligated to begin making payments under the borrower’s student loan agreement plus 3% per year.


A borrower must give notice in writing to the Minister of the selected option by no later than the date the borrower is obligated to begin making payments under the borrower’s student loan agreement.


If the Minister does not receive notice from a borrower of a selected interest rate option, the borrower is deemed to have selected interest rate option (a) above.


Repayment term:     The repayment term of a student loan varies according to the principal amount of the loan. The term is assigned on the date the borrower is obligated to begin making payments, and is based on the following:

Aggregate Loan Amount

Repayment Term

$3000.00 or less

36 months

$3000.01 to $6000.00

72 months

greater than $6000.00

114 months

*”Prime rate” means the variable reference rate of interest as calculated by the Minister from time to time, based upon the variable reference rates of interest declared by the 5 largest Canadian financial institutions or their successors as their rates for Canadian dollar consumer loans. The prime rate is calculated by ignoring both the highest and the lowest of those 5 rates and taking the average of the remaining 3 rates.

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