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Loan Repayment

Student loans are real loans, just like a mortgage, and they must be paid back.  Your loans cannot be cancelled because you did not get the job you had anticipated.  Understanding the repayment process for your student loans will assist you in making wise decisions and help you ensure your financial success.

There are 7 different Repayment Plans to choose from:

  • Standard Repayment Plan
  • Graduated Repayment Plan
  • Extended Repayment Plan
  • Income-Based Repayment Plan (IBR)
  • Pay As You Earn Repayment Plan
  • Income-Contingent Repayment Plan
  • Income-Sensitive Repayment Plan

Visit here for a comparison of the different repayment plans and what types of loans could be included in each repayment plan.

You may also want to consider Loan Consolidation.  This means that you would combine or consolidate all of your Federal Loans together into one loan resulting in one monthly payment as opposed to several monthly payments.  To weigh the pros and cons of loan consolidation and to determine if this would work best for you, visit here.

There are certain instances when a student's loan(s) can be Forgiven, Cancelled, or Discharged.  If a loan is forgiven, cancelled, or discharged, then you no longer have to pay that specific loan(s) back.  This is NOT an automatic process that occurs; you MUST contact your lender directly to apply to receive one of these loan statuses.  Visit here for a helpful chart to see if you may qualify for one of these loan statuses.  Check out the Public Service Loan Forgiveness blog.

If you are having trouble paying back your loans or you have gone back to school, you may qualify for a Deferment or Forbearance.  A deferment is a period during which repayment of the principal and interest of your loan is temporarily delayed.  A forbearance can give you the ability to stop making payments on your loan or reduce the monthly payment for up to 12 months (interest will continue to accrue).  To request a deferment or forbearance, you will need to contact your lender directly.  In some instances, you may also need to contact your school for additional information or to complete paperwork for your lender.

Not sure what you can afford to pay each month?  Use one of these calculators to help figure out what you can reasonably pay each month.


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