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Once you finish school, reality sets in – the bills start coming, and the student loan that once provided you with opportunity may begin to feel like a burden. Understanding your student loan repayment options and learning how to be financially responsible will help you in the repayment of your loans. Let’s face it – there is no “out” with a student loan. Choosing not to repay your student loan will affect you – and others. Not only will your credit and finances suffer, but also the pool of money available for other students will decrease when you don’t pay your loan.

Remember that you’re not alone – men and women live every day with student loans and pay them off successfully. Your life doesn’t have to be bogged down by debt, and you don’t have to feel controlled by financial obligations. Instead, with the information provided here, you can focus on your education and the pursuit of a rewarding career – and handle your loan without worry.

Some basic loan terminology is provided below to help you handle your loans, understand the information you may receive in the mail, and start planning for a future of successful debt management. Knowing the types of loans you receive, your lender’s name and address, and the details of the repayment process are all keys to successful repayment of your student loans.

Borrower: The person (you or your parents) who receives loans to pay for school.

Disbursement: The term used when money is transferred from a lender to you or your school.

Promissory Note: The document you signed agreeing to borrow and repay money for school.

Loan Types: Many terms describe the types of loans you receive to pay for school. Knowing the exact types of loans you have is important, as loans have different repayment and program options. The loans described in the following chart refer to federal student loan programs

Types of Federal Student Loans:

Federal Family Federal Educational Loan Program: Federal program that governs federal loans for which you make repayment to a lender (Stafford Loans, PLUS, Program (FFELP) Loans, and Federal Consolidation Loans.)

Subsidized Federal Stafford Loans: Loans based on financial need.

Unsubsidized Federal Stafford Loans: Loans not based on financial need.

Federal PLUS Loans:Loans borrowed by an undergraduate student’s parents,or by a graduate or professional degree-seeking student. In order to qualify, the borrower must not have adverse credit or must obtain a credit-worthy endorser.

Federal Consolidation Loans: Multiple student loans consolidated or merged into one new loan.

Federal Perkins Loans: Loans for which you make repayment to the school.

Federal Direct Loan Program: Loans for which you make repayment directly to the federal government.

There is additional Student Loan terminology in the "Repayment of Your Student Loan Debt" brochure. 

There are many ways to repay your student loans: repay the whole balance at once or choose a monthly payment plan. If you took out a loan because you didn't have money to pay for school, you probably don't have the ability to repay the whole balance at once. Most of us are going to have to choose a monthly or quarterly payment plan.

Repayment Plan Choices
FFELP loans and Federal Direct loans generally have four specific repayment plans and a minimum monthly payment amount of $50. FFELP loan borrowers can change their repayment plans once every twelve months, and some lenders tailor payment options. Federal Direct loan borrowers can change their repayment plan at any time. Listed below are specific repayment plans for FFELP loans. Federal Direct loan borrowers have similar options, but their terms are slightly different.

• Standard Repayment:You pay a fixed amount each month until the loan is Plan paid in full. Minimum monthly payments are at least $50, and you have up to ten years to repay the loan. Graduated Repayment You pay a lower amount each month in the first year of Plan the repayment period, and the monthly payment amount increases over time. Each payment must equal at least the accrued interest on the loan between payments. No scheduled payment amount can be more than three times greater than any other scheduled amount. You usually have to repay the loan within ten years.



• Extended Repayment:You pay a fixed amount each month and have up to 25 Plan years to repay. This plan is available to students who received their first loan on or after October 7, 1998, and who have loans totaling more than $30,000.



• Income-Sensitive:
You pay a monthly amount based on your yearly income Repayment Plan and loan amount. As your income increases or decreases, so do your monthly loan payments. Each payment must at least equal the interest accrued on the loan between scheduled payments, and no scheduled payment amount can be more than three times greater than any other scheduled payment amount.

• Know who owns and manages your loans.  Refer to the NSLDS (National Student Loan Database System) . This federal database is the central place that lenders and schools report information about your loan.  NSLDS will list all of your student loans that have been reported to them from various lenders or schools.
• In order to use this website you will need a pin# that is assigned to you by the Federal government.  If you don't know your pin# or do not have one; access this website to locate it. http://www.pin.ed.gov/PINWebApp/pinindex.jsp
• Call your lender(s) and ask to speak to a representative instead of going through the automated system when you have a problem that needs an explanation.  They can assist if you are confirming a payment was received, attempting to get access to your account on-line, or responding to an automated message.
• Have all your student account information readily available.  This includes your student loan account number, passwords, security information, and other related paperwork.
• Always keep your lender notified of any changes in your home phone, address, employment information, and your personal e-mail address (if you have one).
• Use the "Student Loan Information Log".  This tool will track manually and electronically all your important student loan information. 

What happens if my life changes and I am unable to make my student loan payments? 

While many programs do exist to help you during hard times, this section describes various payment relief options that are available to student loan borrowers. 

Information regarding the holding of academic transcripts and student records according to Florida Statutes on "defaulted student loans."

The Florida 2007 Statutes states:

No individual borrower who has been determined to be in default in making legally required scholarship loan, student loan, or guaranteed loan repayments shall be furnished with his or her academic transcripts or other student records until such time as the loan is paid in full or the default status has been removed.

Deferments:

A Deferment is a postponement of repayment. A borrower is entitled to a deferment when they meet specific qualifications.  There are many different types of deferments based on loan conditions, loan types, dates and time limits. 

Following is a list and description of the deferment entitlements available to the borrower:

Download the FREE Adobe Acrobat Reader which allows you to view, navigate, and print the following forms.  

• OSFA Exit Counseling Certification Form : This form is completed by the graduating student or early school leaver for the financial aid and school admissions office. This form must be completed and sent back to the financial aid office prior to graduation.
• In-School: You can receive this deferment if you are enrolled at least half time at a post-secondary institution. There is no time limit on this deferment.
• Economic Hardship: You can receive this deferment if you are having difficulty making payments because of reduced or no income in the household.  You can receive this deferment for up to 3 years.
• Unemployment: You can receive this deferment if you are working less than 30 hours and looking for a full time position.  You must show proof that you are looking for full-time work. You can receive deferment for up to 3 years.
• Education Deferment Request: You may defer your loan if engaged in full-time study in a GRADUATE FELLOWSHIP program or if you are engaged in a full-time Rehabilitation Training Program.  This training program must be licensed, approved, certified or recognized as providing rehabilitation training to disabled individuals by the Dept. of Veterans Affairs or a state agency responsible for vocational rehabilitation, drug abuse treatment, mental health services or alcohol abuse treatment programs. 
• Parental Leave/Working Mother Deferment Request: To qualify for the Parental Leave/Working Mother Deferment:  you must have an outstanding balance on at least one FFEL Program loan which was made before July, 1993, OR you must have had a balance on a loan that was made before July 1, 1993, at the time you obtained any loan disbursed on or after July 1, 1993. 
• Public Service Deferment Request:  To qualify for this deferment you must meet one of the following criteria: Be on active duty in the ARMED FORCES, serving full time as an officer in the Commissioned Corps of the Public Health Service, serving in the PEACE CORPS, a full-time paid volunteer in the ACTION PROGRAMS, a full-time paid volunteer for a TAX-EXEMPT Organization or on Active Duty in the National Oceanic and Atmospheric Administration (NOAA).
• Temporary Total Disability Deferment Request: To qualify you must have an outstanding balance on a FFEL program loan which was made before July 1, 1993, or you must have had an outstanding balance on a FFEL Program loan made before July 1, 1993, when you obtained a loan disbursed on or after July 1, 1993. You must be unable to work and earn money or go to school for at least 60 days in order to recover from an injury or illness.  You must not be requesting this deferment based on a condition that existed before you applied for student loan(s) , underlying loans in the case of a consolidation loan, unless this condition has since substantially deteriorated, and you now are temporarily totally disabled.  If requesting this deferment based on the disability of your spouse or dependent, your spouse or dependent must have an injury or illness that requires atleast 90 days of continuous nursing or similar care for yourself, which prevents you from securing full-time employment of at least 30 hours per. week in a position to last at least three months.  Your physician or your spouse's or dependent's physician must recertify this condition every six months to continue this deferment.
• Plus Borrower with Dependent Student Deferment Request:  You may defer repayment of your loan(s) while the student for whom you borrowed a Federal PLUS loan is a dependent and is: enrolled full-time at an eligible school, enrolled half-time at an eligible school, or engaged full-time in a rehabilitation program.
• Military Deferment Request:  This is a new deferment available for individual loans after 07/01/2001. It provides 3 years of deferment for the eligible borrower on active duty during war, national emergency or a military operation. Exception on loan date with consolidated loans, this can be requested by the borrower representative. Loans with first disbursement made after 07/01/2001. This deferment form will be available after 09/25/06.

• You must continue to make payments on the loan until you’ve been notified the deferment entitlement has been approved.
• If you apply for the deferment and don’t receive a response within 7 days-----call your lender. 
• You will not be approved for a deferment if your loan defaults.  Continue to make your regular payments until you receive notification from your lender it’s been deferred.
• Remember, that some deferments have time limits. For example, if you have a 20-year loan, and exhaust the 3-year unemployment deferment in the first 3 years of the loan you will be unable to use that deferment again for the next 17 years.

Forbearance:

Forbearance is also a postponement or reduction of your monthly student loan payment.   The difference between forbearance and a deferment is that a borrower is entitled to a deferment when they qualify.  A forbearance is granted at the discretion of the lender. 

Forbearance Forms

(The following forms are just for sample purposes, please check with your lender for a current version)

• ACS form
• American Education Services (AES) form
• Ed Financial Services form
• Nelnet form
• Sallie Mae form
• Sun Tech, INC. form
• Wells Fargo form

• Always ask your lender if you qualify for a deferment before discussing forbearances.
• Be aware that consolidating federal student loans into a regular non-student loan will cause you to lose deferment and forbearance options.
• Carefully read the directions on forms, borrowers must sign deferments and forbearances and in some cases forms will need a signature from a third party verifying your condition.
• When applying for forbearance, ask the lender if they can approve it while you are on the phone.
• Agreeing to a reduced payment with your lender may cause the lender to use forbearance time to allow this reduced payment. Ask your lender how using the forbearance will affect future eligibility for financial aid?