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Queen's University
 

OSAP Appeals

Credit Checks

 

Overview of Credit Check Process

OSAP-eligible applicants will be subject to a credit history check if they meet the following criteria: 

  • They are 22 years of age or older at the time they apply for OSAP; and
  • They have never been eligible to receive student loans under OSAP in the past.

Criteria to pass Credit History Check

OSAP applicants who are subject to a credit history check must not have been delinquent for more than 90 days on three or more credit accounts/loans, each with a value of $1,000 or more, within the past three years.

Note: all OSAP applicants under the age of 22 are not subject to a credit history check regardless of if they have received student loans in the past or not.

 

Credit Check Review

Poor credit history may be due to exceptional circumstances that were beyond the student’s control which led to his or her financial difficulty (including significant and unexpected loss of income or unusual increases in expenses). A review process has been established for students who can demonstrate exceptional circumstances and a strong likelihood of being able to repay their student loans.

Situations which can be reviewed

The situations listed below are not inclusive.  Other situations may be submitted to the FEAC providing they meet two basic criteria.

  • The credit history problems occurred as a result of circumstances beyond the control of the applicant and/or spouse; and,
  • There is strong likelihood that the applicant will be able to repay his/her student loans.

Submission Deadline:

The deadline for submitting a request for reconsideration of a failed credit check is eight weeks before the end of the student’s study period.

  • In the case of a layoff or dismissal, submit a copy of the notice of layoff or dismissal, or a copy of the Record of Employment (ROE). The reason for any dismissal should be included in the review documentation because if an applicant has been dismissed for just cause, the circumstances were not likely beyond his or her control.
  • In the case of a reduction to part-time or lower paying work, submit a letter from the applicant/spouse’s employer indicating the reduction in the amount of time worked or salary earned, and why this reduction happened.

 

A loss or a Substantial Reduction in Employment Income

Layoff, Dismissal, or Reduction of Normal Income

If the applicant and/or spouse experienced a reduction or interruption in regular employment earnings because of a layoff, dismissal, reduction to part-time or lower-paying work that affected the applicant’s credit history, the applicant should submit the following:

  • In each case, a letter from the applicant or spouse indicating the reasons the student or spouse was unable to find new or additional employment. The student or spouse must demonstrate that they made a reasonable effort to find full-time work. This includes:
  • A letter from the student or spouse indicating the reason they were unable to find employment for the study period;
  • Proof of the student’s or spouse’s participation in a community job search program (e.g., Job Connect or other community employment programs); and
  • A detailed job search history covering the duration of the study period to date. The details must include contact information for each respective employer (full address, telephone number, name of contact person, position applied for and date of application). In addition, the job search history should be for a time period that covers the last few months prior to the submission of the review as well as a sufficient portion of the study period to reflect the “on-going” nature of the spouse’s efforts to obtain employment. This information will be verified by the ministry.
  • A letter from the applicant indicating how the successful completion of his/her academic program will lead to gainful employment which will enable student loan repayment. The letter should also include the student’s recent postsecondary history, if any (e.g., years attended, programs enrolled in, programs completed).

Documentation from the student which demonstrates the student’s likelihood to repay any student loans. Examples include, but are not limited to, the following:

  • Bankruptcy documents (particularly the Liabilities Page, listing a creditors and the Order of Discharge, if applicable;
  • A detailed itemized budget or financial plan;
  • A recent demonstration of financial stability/responsibility (e.g., a recent history of bill payment);
  • Employment prospects;
  • Research that suggests that the student would be able to secure employment upon graduation;
  • Realistic financial projections/budget based on the aforementioned research;
  • Employment trends;
  • Documentation of concerted efforts to improve credit rating;
  • Proof of credit counseling, etc.

 

Illness

Where a period of temporary illness prevents the applicant or spouse from working for a substantial period of time, and thus affects the applicant’s credit history, the applicant should submit the following:

  • completed credit check review form
  •  letter from the applicant/spouse indicating the reason that the applicant/spouse was unable to work during the period of time where the credit problems occurred;
  • a certificate from a physician outlining the nature of the illness, the care required and the period of time during which the applicant or spouse was unable to work;
  • a copy of the Record of Employment issued by the applicant/spouse’s employer showing reason for separation as Code “D” (illness or injury) or a letter of approval from Service Canada indicating the student/spouse is in receipt of Employment Insurance sickness benefits;
  • a letter from the applicant indicating how the successful completion of his/her academic program will lead to gainful employment which will enable student loan repayment.
  • Documentation from the student which demonstrates the student’s likelihood to  repay any student loans.  See heading A loss or a substantial reduction in employment income for examples of documentation.

 

Inability to Work Full or Part-Time Due to a Disability

If the applicant/spouse has recently become disabled or has an ongoing disability which has caused a substantial reduction in normal income that caused credit problems, the applicant should submit:

  • a medical certificate to substantiate both the disability and their inability to work full - or part-time because of the disability;
  • a letter from the applicant indicating how the successful completion of his/her academic program will lead to gainful employment which will enable student loan repayment.  The letter should include a postsecondary history, if any (e.g., years attended, programs enrolled in, programs completed); and 
  • documentation from the student which demonstrates the student’s likelihood to repay any student loans.   See heading A loss or a substantial reduction in employment income for examples of documentation.

 

Changes in Family/Marital Situation

In cases where a change in family situation (e.g., divorce/separation), death of a spouse, or birth of a child affected the normal income of the applicant/spouse and caused the credit report problems, the applicant should submit:

  • a copy of the divorce/separation papers indicating that the applicant has a legal responsibility to make payments to the child or former spouse, and the date this became effective; 
  • a copy of the death or birth certificate;
  • a letter from the applicant indicating how the successful completion of his/her academic program will lead to gainful employment which will enable student loan repayment.  The letter should a postsecondary history, if any (e.g., years attended, programs enrolled in, programs completed); and 
  • documentation from the student which demonstrates the student’s likelihood to repay any student loans.  See heading A loss or a substantial reduction in employment income for examples of documentation.

 

Failure of Former Spouse to Maintain Family Support Payments

Where the credit problems were caused as a result of a former spouse failing to meet his/her court-ordered family support payment obligations, the applicant should submit:

  • completed credit check review form
  • a letter from his/her lawyer indicating the amount and time period which payments from the former spouse were not made;
  • a copy of the enforcement order from Family Responsibility Office;
  • a letter from the applicant indicating how the successful completion of his/her academic program will lead to gainful employment which will enable student loan repayment. The letter should include a postsecondary history, if any (e.g., years attended, programs enrolled in, programs completed); and
  • documentation from the student which demonstrates the student’s likelihood to repay any student loans.   See heading A loss or a substantial reduction in employment income for examples of documentation.

 

Unexpected or exceptional expenses

Essential Home Repairs

Where credit problems are caused by home repairs, not covered by insurance, which were necessary for health and safety reasons, the applicant should submit:

  • receipts which itemize costs paid and a statement from the applicant describing the type and necessity of the repair (i.e., repairs required for health and safety reasons, are typically a one-time only expense, and are not covered by an insurance plan);
  • building permit/contract for the repairs (if applicable); 
  • a letter from the applicant indicating how the successful completion of his/her academic program will lead to gainful employment which will enable student loan repayment.  The letter should include a postsecondary history, if any (e.g., years attended, programs enrolled in, programs completed); and
  • documentation from the student which demonstrates the student’s likelihood to repay any student loans.  See heading A loss or a substantial reduction in employment income for examples of documentation.

 

Legal Fees

Legal fees incurred and paid by the applicant and/or spouse that are related to the period of credit problems may be submitted to review.  Fees related to the purchase of a home and those related to the operation of a business will not be considered. 

The applicant should submit:

  • an itemized statement from his/her lawyer showing amounts paid, when payments were made, and the reasons for the cost;
  • a letter from the applicant indicating how the successful completion of his/her academic program will lead to gainful employment which will enable student loan repayment.  The letter should include a postsecondary history, if any (e.g., years attended, programs enrolled in, programs completed); and
  • documentation from the student which demonstrates the student’s likelihood to repay any student loans.   See heading A loss or a substantial reduction in employment income for examples of documentation.

 

Uninsured Medical, Dental Or Optical Expenses

Where amounts paid by the applicant and/or spouse for required and uninsured medical, dental and optical expense caused credit difficulties, the applicant should submit:

  • a copy of receipts from the dentist, doctor, hospital or pharmacist (costs must not have been paid by another person or by a private insurance plan);
  • a letter from the applicant indicating how the successful completion of his/her academic program will lead to gainful employment which will enable student loan repayment.  The letter should include a postsecondary history, if any (e.g., years attended, programs enrolled in, programs completed); and 
  • documentation from the student which demonstrates the student’s likelihood to repay any student loans.   See heading A loss or a substantial reduction in employment income for examples of documentation.

 

Caring for Children with Disabilities

If a dependent child of a married or sole-support student becomes disabled resulting in significant child care/attendant care expenses to be incurred for the care of the dependent child, the student should submit:

  • completed  credit check review form
  • copies of all child/attendant care receipts for the time period relating to the credit history problems;
  • a letter from the family indicating the nature of the disabled child’s condition;
  • a letter from the applicant indicating how the successful completion of his/her academic program will lead to gainful employment which will enable student loan repayment.  The letter should include a postsecondary history, if any (e.g., years attended, programs enrolled in, programs completed). 
  • documentation from the student which demonstrates the student’s likelihood to repay any student loans.   See heading A loss or a substantial reduction in employment income for examples of documentation.

 

Caring for Elderly/Infirm Relatives

If as a result of incurring expenses to care for an elderly/infirm relative, the applicant’s credit history is impaired, he/she can submit:

  • completed credit check review form
  • copies of all receipts for costs incurred to care for the elderly/infirm relative for the time period relating to the credit history problems;
  • a letter from the applicant outlining the details of the situation (i.e., nature and duration of care required);
  • a letter from the applicant indicating how the successful completion of his/her academic program will lead to gainful employment which will enable student loan repayment.  The letter should include a postsecondary history, if any (e.g., years attended, programs enrolled in, programs completed); and 
  • documentation from the student which demonstrates the student’s likelihood to repay any student loans.   See heading A loss or a substantial reduction in employment income for examples of documentation.

 

Credit Checks: Sole-Support Parents Only

Overview

FAAs may approve OSAP funding for sole-support parents who fail the credit check if all of the following conditions are met:

  • the student is a sole support parent and the FAA has satisfied the supporting document requirement for this status on the student’s current OSAP account;
  • the student’s total debts, judgments, and collections, as listed on an Equifax report, are less than $30,000; and
  • the student’s credit problems are a direct result of  the breakdown of their relationship with the parent of their child(ren). Thus, a sole support parent with credit problems that do not coincide with the circumstances of the breakdown of his or her relationship with the other parent of their child(ren) does not qualify for an FAA credit check request for reconsideration and must apply directly to the FEAC.

Documentation required:

  • copy of the student’s Equifax report (FAA to request from OSAP FEAC Clerk);
  • a letter from the student describing the reasons for his or her financial difficulties, and an explanation of why the student feels he or she will be able to repay their student loans;
  • supporting documentation to substantiate the breakdown of the relationship and resulting financial difficulties, such as legal fees for child custody; and
  • Documentation from the student which demonstrates the student’s likelihood to repay any student loans. Examples include but are not limited to the following:
  • Bankruptcy documents (particularly the Liabilities Page, listing all creditors and the Order of Discharge, if applicable);
  • A detailed, itemized budget or financial plan;
  • A recent demonstration of financial stability/responsibility (e.g., a recent history of timely bill payment);
  • Employment prospects;
  • Research that suggests that the student would be able to secure employment upon graduation;
  • Realistic financial projections/budget based on the aforementioned research;
  • Employment trends;
  • Documentation of concerted effort to improve credit rating;
  • Proof of credit counseling, etc.
  • completed copy of credit check review form

Kingston, Ontario, Canada. K7L 3N6. 613.533.2000