Your future. Our Mission.

1. Your future. Our Mission. Student Financial Assistance Office

2. Repaying Student Loans – Take inventory your federal student loans – Explore repayment plans available – Understand the basics of consolidation – Learn about deferment and forbearance

3. Taking Inventory Where can I obtain information on my federal loans? • – National Student Loan Data System (NSLDS) http://www.nslds.ed.gov/ Provides loan amounts, loan holders, and loan servicers

4. What happens to my loans when I leave school? A FFELP or Direct Stafford loan either: • Will enter a 6-month grace period • Will enter repayment A Perkins loan either: • Will enter a 9-month grace period • Will enter a 6-month post-deferment grace period A Grad PLUS loan either: • Will enter a 6-month deferment • Will enter repayment A federal consolidation loan: • Will enter repayment A private or alternative loan • Contact the lender

5. What should I expect from my loan holder/servicer? • Repayment disclosure notices - Outlines the terms of the loan(s) borrowed - Provides the repayment options available - Establishes the first payment due date

6. What does my loan holder/servicer expect from me? -To select a repayment plan - To make timely payments on your loans - To provide updated contact information whenever it changes - To contact the loan holder whenever you are having difficulty managing repayment Learn Moresfa.mst.edu

7. Can I pre-pay on my loans? Yes… - If sending in a prepayment, make sure you inform the lender to apply the prepayment to the principal of the loan balance - There is no prepayment penalty Learn Moresfa.mst.edu

8. Overview of repayment plans What repayment plans are available? • Standard • Graduated • Extended • Income-sensitive (FFELP only) • Income-contingent (FDLP only) • Income-based Learn Moresfa.mst.edu

9. How do repayment plans work? • Standard: - Lowest total loan cost. - Regular payments of both principal and interest are due monthly, excluding periods of deferment and forbearance • Minimum monthly payment is $50 with 10 yr repayment • Graduated: - Monthly payments are smaller at the start of the repayment period and gradually increase every two years - 10-year repayment term • Total amount paid in interest will be greater than under the standard repayment plan

10. Repayment Plans con’t • Extended: - Lengthens repayment term up to 25 years - Available to borrowers with more than $30,000 in federal student loans (per program) • Total interest costs may be higher over life of the loan, although monthly payment amount may be lower

11. Repayment plans con’t • Income-sensitive (FFELP): - Offered only to borrowers under the FFELP - Monthly payment varies according to gross monthly income - Monthly payment covers at least monthly accruing interest - Must reapply annually - Total interest costs will be higher over the life of your loan than with standard repayment - Maximum repayment period is 10 years

12. Repayment plans con’t • Income-contingent (FDLP): - Offered only to borrowers under the Direct Loan Program • Monthly payment based on adjusted gross income, family size, and total Direct Loan debt - Maximum repayment period is 25 years, and any balance after 25 years (time spent in deferment or forbearance does not count) is forgiven.

13. What is income-based repayment (IBR)? • IBR is designed to help borrowers experiencing a “partial financial hardship”. • Available to Stafford, • Grad PLUS, and certain • consolidation borrowers. Learn Moresfa.mst.edu

14. How do I apply for IBR? Contact loan holder/servicer and request an IBR plan • IBR forms available at: http://studentaid.ed.gov/PORTALSWebApp/students/english/IBRPlan.jsp - Borrower must: Apply annually (payment amount may fluctuate) - Provide permission for IRS to disclose AGI "and other tax return information“ - Certify family size

15. Basics of Consolidation – Consolidation enables you to bundle one or more federal student loans into a single new loan. – At time of consolidation, your consolidating loan holder pays off the outstanding balances of the loans you include in the consolidation. – No fees.

16. Who can consolidate? – Any federal student loan borrower, including: • Borrowers with student loans. • Borrowers with student & parent loans. Learn Moresfa.mst.edu

17. How do I qualify? – You must be in your grace period or in repayment on each loan being consolidated. – You can still obtain a Consolidation loan if you are delinquent or in default on one or more of your existing loans.

18. What loans may be consolidated? – Federal Family Education Loans – Federal Direct Loans – Federal Perkins Loans – Health Professions Student Loans – Nursing Student Loans – Health Education Assistance Loans Learn Moresfa.mst.edu

19. What loans may not be consolidate? – Private (alternative) education loans – Other consumer debt **Private consolidation loans – Do not offer the same advantages (i.e., repayment options, deferments, etc.) as a federal consolidation loan – Interest rate will be credit-based and likely higher than a federal consolidation loan

20. Can I ever “Re-consolidate”? – Generally, no – You may only reconsolidate if you consolidate an existing Consolidation loan with another loan outside the Consolidation loan Learn Moresfa.mst.edu

21. Factors to consider in consolidating + Bring together loans with multiple loan holder for convenience of one payment. + Lower loan payments by lengthening repayment period. + May be able to lock in a more favorable interest rate. • May lose some or all of grace period. • May lose certain borrower benefits • May increase total cost of loan if you lengthen your repayment period, you will pay more interest in the long run.

22. Loan Deferment • A deferment is a period of time when payment on a loan is temporarily postponed. • Interest payment • Federal government pays the interest during deferments for subsidized loans and for the underlying subsidized loans that were consolidated. • Borrower is responsible for the interest for unsubsidized Stafford loans, GradPLUS loans, and PLUS loans and for the underlying unsubsidized loans that were consolidated

23. Types of Deferment • Enrolled at least half-time at an approved postsecondary school • Study in an approved graduate fellowship program or an approved rehabilitation training program for the disabled • Unable to find full-time employment (up to 3 years) • Economic Hardship (up to 3 years) • Engages in service listed under discharge/cancellation conditions (Perkins only) • Active Military Duty, for loans first disbursed on/after July 1, 2001; while borrower is on active duty during a war or other military option, or national emergency (up to 3 years) • www.studentloans.gov

24. Forbearance • A period of time during which the borrower is permitted to temporarily cease making payments or reduce the amount of the payments. – Borrower is liable for all interest that accrues on the loan. – Contact your loan holder • Some deferment types require an application

25. Helpful Resources • www.federalstudentaid.ed.gov/students.html • www.studentloans.gov • www.nslds.ed.gov • www.dl.ed.gov • www.loanconsolidation.ed.gov • www.finaid.org • www.tgslc.org/borrowers

26. Student Financial Assistance Office • G-1 Parker Hall • 573-341-4282 • 1-800-522-0938 • sfa@mst.edu • sfa.mst.edu