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Loan Repayment

While you are enrolled half-time or higher in a degree program your loans will be in “in-school deferment” status. This means your Federal Direct Subsidized loans will not accrue interest while you are in school and you can temporarily stop making payments. However, Federal Unsubsidized and Private Student Loans will accrue interest throughout the life of the loan.

The College will electronically update your enrollment status within the first few weeks of every semester.

Once you drop below half-time enrollment all student loans will go into "grace period" status, followed by "repayment" status. Your loan servicer will be in contact with you during school and during your grace period to prepare you for repayment. Your first loan payments are normally due a month after the grace period ends.

Preparing for Repayment


1. Find All the Loans You Borrowed.

Log into the National Student Loan Data System, NSLDS.ed.gov, using your FSA ID. You will see a list of your federal loans borrowed to date. Click on the number next to each loan to find the interest rate, loan status and contact info for the company who is servicing the loan.

2. Complete Your Loan Exit Counseling When You Leave School.

You will receive emails from the school if you need to complete loan exit counseling. This usually happens right before you graduate or just after you drop below halftime. Exit counseling is an online tutorial that reviews the loan terms of the loans you borrowed and gives you a chance to review your loan details, repayment plans and update your contact information.

Complete Exit Counseling

3. Create an Account on Your Loan Servicer(s) Website.

Since you started borrowing your Federal Direct Stafford Loans your loan servicer has been in contact with you. They will encourage you to set up an account on their website so you can learn about the following:
  • When your loan grace period(s) end: Subsidized and Unsubsidized loans have a 6 month grace period.
  • The amount of your first loan payment and when it is due.
  • The interest rate is for each loan you borrowed.

 4. Choose Your Loan Repayment Plan.

Use the Repayment Estimator to review what your monthly payment would be in all the federal repayment plans, then choose one that suits your financial situation. Work with your loan servicer to get the plan set up before your first payment is due.
  • Setting up automatic loan payments from your bank every month means your payments will never be late. You may also be eligible for a 0.25% monthly interest reduction. Work with your loan servicer to get auto loan payments set up before your first payment is due.
Repayment Estimator
 

Repayment Plan

Monthly Payment and Time Frame

Standard Repayment Plan -Payments are a fixed amount.
-Up to 10 years (up to 30 years for Consolidation Loans).
Graduated Repayment Plan -Payments are lower at first and then increase, usually every two years.
-Up to 10 years (up to 30 years for Consolidation Loans).
Extended Repayment Plan -Payments may be fixed or graduated.
-Up to 25 years.
 
 

 Income-Driven Repayment Plans (IDR)

An income-driven repayment plan sets your monthly student loan payment at an amount that is intended to be affordable based on your income and family size. 
 

Repayment Plan

Monthly Payment and Time Frame

Revised Pay As You Earn Repayment  Plan (REPAYE) -Your monthly payments will be 10 percent of discretionary income.
-Payments are recalculated each year and are based on your updated income and family size.
-If you're married, both you and your spouse’s income or loan debt will be considered, whether taxes are filed jointly or separately (with limited exceptions).
-Any outstanding balance on your loan will be forgiven if you haven't repaid your loan in full after 20 or 25 years.
Pay As You Earn Repayment Plan (PAYE) -Your maximum monthly payments will be 10 percent of discretionary income.
-Payments are recalculated each year and are based on your updated income and family size.
-If you're married, your spouse's income or loan debt will be considered only if you file a joint tax return.
-Any outstanding balance on your loan will be forgiven if you haven't repaid your loan in full after 20 years.
Income-Based Repayment Plan (IBR) -Your monthly payments will be 10 or 15 percent of discretionary income.
-Payments are recalculated each year and are based on your updated income and family size.
-If you're married, your spouse's income or loan debt will be considered only if you file a joint tax return.
-Any outstanding balance on your loan will be forgiven if you haven't repaid your loan in full after 20 or 25 years.
-You may have to pay income tax on any amount that is forgiven.
Income-Contingent Repayment Plan (ICR) Your monthly payment will be the lesser of:
-20 percent of discretionary income, or the amount you would pay on a repayment plan with a fixed payment over 12 years, adjusted according to your income.
-Payments are recalculated each year and are based on your updated income, family size, and the total amount of your Direct Loans.
-If you're married, your spouse's income or loan debt will be considered only if you file a joint tax return or you choose to repay your Direct Loans jointly with your spouse.
-Any outstanding balance will be forgiven if you haven't repaid your loan in full after 25 years.
 
If you’d like to repay your federal student loans under an income-driven plan, you need to fill out an application.

Apply for IDR

Other Repayment Options to Consider:  

Federal Direct Loan Consolidation

  • A consolidation loan combines multiple loans (Subsidized and Unsubsidized) into one large loan.
  • Consolidation extends payment period up to 25 years, depending on the amount you owe.
  • A new interest rate is based on a weighted average of all loans put into the consolidation.
  • Your grace period ends once the consolidation is final, so complete consolidation near the end of your grace period, if possible.
  • Subsidized Direct Loan will begin to accrue interest once you consolidate them so complete consolidation near the end of your grace period, if possible.  
Federal Direct Loan Consolidation can be completed at www.studentloans.gov.

Federal Direct Loan Forgiveness Programs

The Department of Education offers two loan forgiveness programs to encourage borrowers to enter full-time public service, or teach in certain high-need areas in high-need subjects. Read more here: 
Public Service Forgiveness Program | Teacher Loan Forgiveness

Additional Resources

SALT is a free, online resource that helps students finance a higher education, manage any student loans and build personal finance skills.



Salt Can Help You With:

  • Tracking and planning your student loans
  • Managing student loans and repayment options
  • Creating a manageable budget
  • Credit and debt management
  • Saving and investing
  • Finding scholarships, internships, and jobs
Sign up for SALT today!
Have questions about managing your loans?
Call loan support at 877.523.9473 or email loanhelp@saltmoney.org.

Need Help with your membership or using the website?

Call member support at 855.469.2724 or email membersupport@saltmoney.org

3 Ways You Can Keep on Track with Loan Payments

1. Change your payment due date. Do you get paid after your student loan payment is due each month? If so, contact your loan servicer and ask whether you’d be able to switch the date your student loan payment is due.

2. Change your repayment plan. What you ultimately pay depends on the plan you choose and when you borrowed. If you need lower monthly payments, consider an income-driven repayment plan that’ll base your monthly payment amount on how much you make.

3. Consolidate your loans. If you have multiple student loans, simplify the repayment process with a Direct Consolidation Loan—allowing you to combine all your federal student loans into one loan for one monthly payment.
 

If the options above do not work for you and you simply cannot make any payments, you might be eligible to postpone your payments through a deferment or forbearance. However, depending on the type of loan you have, interest may still accrue (accumulate) on your loan during the time you are not making payments.

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