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Because life after graduate or professional school is different for everyone, student loans offer multiple payment options to suit your particular financial situation. You won’t need to start repaying your loan until you’ve graduated, unless you’ve dropped out or have suspended studies. Before your first payment is due, you will be given a grace period of six to nine months, starting the day you drop below half-time enrollment status. This will give you time to find a job and get your finances together. However, with unsubsidized loans, the interest will start accumulating as soon as the loan is disbursed. It may be wise to set up a payment plan that allows you to just pay the interest while in graduate or professional school. This will help lower the cost in the future. Otherwise, you can let the accumulated interest be added to the balance of your loan to be paid after your grace period expires.
When the time comes to begin repaying your loans, it’s important that you talk with your lender, so that together you can determine the repayment plan that’s right for your budget. If your plan doesn’t meet your needs, causing you to miss or fall short of a payment, your loan will become delinquent and possibly default. A default can impact you, costing you more money and leaving you with a bad credit rating for up to seven years after the loan is paid in full. A bad credit rating can affect your opportunities for employment, credit cards, future loans and buying or renting property. Avoid default altogether by selecting the appropriate payment plan. To bring a loan out of default, you can either pay the loan in full, agree to repay it through a loan rehabilitation program, or apply for loan consolidation.
Loan forgiveness is an option that allows you to cancel all or part of your loan(s) due to volunteer work (AmeriCorps, Peace Corps), military service, teaching in certain low-income communities, medical or law practice for certain groups/areas, a closed school, false certification or an unpaid refund. Your loan will be forgiven if you are totally and permanently disabled, or upon your death.
To help you manage your student loan debt, and to successfully repay your loan, stay in touch with your lender, financial aid office or ISAC. Be sure to discuss other payment options, such as loan deferment or a loan forbearance. Also, read any mail you receive regarding your loan, keep records, stay current with your payments, and write your loan account number on all correspondence pieces with your lender, and on your checks.
If you have any questions about your loan and/or grant amounts, outstanding balances, disbursements or loan statuses, check with the National Student Loan Data System (NSLDS).
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