Repaying Your Student Loans
Special Notice to student borrowers regarding student loan debt relief scams:
With the recent announcement of the Biden-Harris Student Loan Debt Relief Program, scammers have increased their activity in contacting student loan borrowers. Here are some important tips from the Better Business Bureau and the Federal Trade Commission to help you avoid being the victim of a scam:
- Don’t pay for information and assistance that is already free! Beware of companies that want to charge you a fee to consolidate loans, reduce your interest rates or even eliminate loans entirely.—all of these services are available free of charge from the U.S. Department of Education or by contacting your loan servicer directly. If a company says they can do it faster, better, and wants you to sign a document allowing them to act on your behalf—beware—these are red flags of a scam!
- Be wary of someone who calls, texts, or emails you about student debt relief claiming to be from the government. Scammers will even create websites made to look like a government website. Don’t provide personal information or agree to anything before you do more research. Simply hang up, stop emailing or texting, and look up the information on ED.gov and/or studentaid.gov, and/or call your lender.
- Be careful even if you think you know the person who sent you the information! Hackers and scammers can masquerade as friends! There are numerous instances of hacked social media accounts being used to spread government imposter scams. Before you trust any information you receive about student loan debt relief, make sure you check it out first on studentaid.gov, or call your lender.
The U.S. Department of Education provides information about avoiding loan scams.
ISAC urges you to remember to never pay for information about how to pay back your student loans, to learn about your repayment options through the resources and links provided below, and to contact your loan servicer directly to arrange repayment. If you don't know who your loan holder is, use the My Federal Student Aid website or phone 800.4FED.AID (800.433.3243) for help in identifying them.
If you feel you have been the victim of fraud or a scam, use the contact information in the Attorney General’s Student Loan Debt Relief Fact Sheet to make a report. You can also use the Attorney General’s Student Loan Helpline – 800.455.2456 (TTY – 800.964.3013) – to file complaints of student loan debt relief scams.
Notwithstanding the Biden-Harris Student Loan Debt Relief Program and other loan forgiveness programs such as the Public Service Loan Forgiveness Program, you should assume that any loans you’ve taken out for college need to be paid back, regardless of whether you’ve completed your degree or landed a job in your field of study. In addition, some of the financial aid you’ve received may have program requirements that must be met now to prevent the funds received from turning into a loan.
Once out of college, you’ll typically have a six month grace period (depending on the type of loan program) before you have to start making payments. Federal student loans offer multiple repayment plans, depending on your financial situation. They include standard, graduated, extended and income-based options, among others. There are also loan forgiveness, cancellation and discharge options available under certain circumstances. Use one of the many available estimators to find out which plans you may be eligible for and get estimates of your monthly and overall payments, based on your interest rate. In the absence of a repayment option selection, you will be given the standard repayment option.
Repaying your student loan(s) is a very important responsibility. The consequences of falling behind and becoming delinquent will have a detrimental effect on your credit rating and may lead to default. Make sure you budget your money wisely in order to make your monthly payments. If you are having a difficult time and are unable to make your payments, contact your lender immediately to discuss your situation. You may be eligible for a deferment or forbearance, or you may qualify for loan consolidation.
If you are unsure who holds your loan(s) and need help identifying your lender, servicer and/or guarantor, use the My Federal Student Aid website to retrieve your loan information, including outstanding balances and statuses. You may also contact them by phone at 800-4-FED-AID (800.433.3243).