Student Loan Repayment

When you decide to borrow for an education, you assume an obligation to repay all amounts borrowed.

Educational loans are like any other loans and must be repaid whether you complete your education or not, even if you can't find a job. It's obviously important to carefully consider your decision. And don't borrow more than you realistically think you'll be able to repay.

Maintaining all your loan records together in a convenient place will make the job of managing your student loan debt a lot easier. Keep these items on hand:

• Copies of all loan applications/promissory notes
• Copies of all loan disclosure statements
• Copies of all correspondence with your school, lender, servicer, or secondary market (including a record of all telephone calls)

Repayment Tips:

Repaying your loan on time has great advantages. Timely payments reported to credit bureaus give you a favorable credit rating, which can open doors to borrowing for that new home or car you've dreamed about.

If you don't repay your loan and it becomes evident to your loan holder that you don't intend to honor your obligation, your loan goes into default. Your loan can default from a lack of paperwork as easily as from a lack of payment. For that reason, it's important to keep your loan holder informed of any changes in your status, as well as your current address and a daytime phone number.

You can avoid default by communicating with your loan holder. If you're temporarily unable to make your payments, call your loan holder. Forbearance, deferment, or other repayment options may be available. You may also qualify for a consolidation loan.

The consequences of default can be far-reaching. A default becomes part of your credit record and can restrict your ability to borrow money for items such as a home or an automobile. It may also prohibit you from obtaining future student aid. Your state and federal income tax refunds can be withheld and your wages garnished to repay your debt. Any additional charges associated with collecting your defaulted loan--attorney fees, collection agency charges, and court costs, for instance - may be passed on to you and become part of your loan debt. Develop a budget and keep it realistic.

Repayment Schedule:

Use our payment calculator to estimate your monthly payment. Remember this is only an estimate. Your actual payment amount may vary. Check with your loan holder to determine your actual payment amount.