Repayment of Federal loans is a serious obligation. There are a number of repayment options available to help borrowers to meet their obligations. Remember, you are required to make your student loan payments even if you:
- Do not complete your education
- Are not employed upon completion of your studies
- Do not find employment in your field of study
- Feel that the education you received did not meet your expectations
- Do not receive a bill
Failure to make your loan repayment on time may:
- Damage your credit rating, which could impact your ability to borrow
- Refer your account to a collection agency
- Incur collection costs
- Cause garnishment of your wages
- Cause withholding of your state or Federal treasury payments (including federal tax refunds, Social Security benefits, etc.)
- Cause a civil lawsuit, including court costs and legal expenses
- Cause loss of deferment and forbearance entitlements and flexible repayment options
- Cause loss of eligibility for further financial aid
- Suspend your professional license
Repayment options
There are a number of repayment options available. You should discuss them with your lender to determine which will be the best for you:
- Standard Repayment
- Graduated Repayment
- Extended Repayment
- Income-Based Repayment
- Pay As You Earn Repayment (PAYE)
- Revised Pay As You Earn Repayment (REPAYE)
- Income-Contingent Repayment
- Income-Sensitive Repayment
For full details see the Department of Education Repayment webpages or American Student Assistance. You will always pay the least amount of interest under the Standard Repayment Plan.
