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Avoiding Default

1. What is default? If you miss a student loan payment or pay late, your loan is delinquent and your lender may charge you late fees. If your federal student loan is 270 days or more past due, your loan enters into default, and the lender or guarantor may garnish your wages, seize your tax refunds, and more. It can damage your credit rating and affect your ability to rent an apartment, get a job, or qualify for a home or car loan.

2. Contact your lender if you are having trouble making a payment, so you can discuss your options. Do not just ignore your student loan obligations.

3. Postpone your payments. By postponing your payments, you can get short-term relief from making payments until your financial situation improves, while still maintaining your good credit. Both deferments and forbearances allow you to stop making payments temporarily. Only your loan servicer can put your loans in a deferment or forbearance.

Entering Repayment

1. Choose the Right Repayment Option: When your federal loans come due, your loan payments will automatically be based on a standard 10-year repayment plan. If the standard payment is going to be hard for you to maintain, there are other options, and you can change plans down the line if you want or need to. See the repayment plans sheet for more information.

2. Consider consolidating: consolidating allows you to have just one monthly payment with one loan servicer. See consolidation flyer

3. Make payments on time every time: Not paying can lead to delinquency and default. If you are having trouble making your payments, you should contact your loan servicer to discuss your options.

4. Don’t ignore your loans or your loan servicer: Ignoring your student loans has serious consequences that can last a lifetime. Loan servicers are eager to help with any issue and can often resolve problems with just one phone call.

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. Preparing for Repayment

1. Complete exit counseling at www.studentloans.gov

2. Know what you owe: It's important to keep track of the lender, balance, and repayment status for each of your student loans. Visit www.nslds.ed.gov , you can log in and see the loan amounts, lender(s), and repayment status for all of your federal loans.

3. Know your grace period: A grace period is how long you can wait after leaving school before you have to make your first payment. Don't miss your first payment!

4. Stay in Touch with Your Lender: Set-up an online account with your loan servicer prior to your first payment. Be sure to read all correspondence coming from your loan servicer. If you move or change your phone number or email address let your loan servicer know immediately.

5. Ask Questions: Your loan servicer will begin to contact you immediately once you are no longer enrolled. It is important to understand your responsibilities as a borrower. If you do not understand something, call your loan servicer or call the Office of Financial Aid at McNeese.