Federal Student Loan Repayment Plans and the Repayment Estimator

1. Federal Student Loan Repayment Plans and the Repayment Estimator June 2016

2. Today’s Topics • Student Loan Basics • Repayment Options and Repayment Estimator • Postponing Payments, Default, and Discharge • Federal Student Aid Resources

3. Student Loan Basics Types of Loans and Loan Servicers

4. Identify Your Loans Access NSLDS using your FSA ID at nslds.ed.gov

5. Federal Student Loan Programs

6. Federal Student Loan Types

7. Interest Rate for Federal Loans

9. Loan Servicers The following are loan servicers for federally held loans made through the Direct Loan and (FFEL) Programs: • CornerStone • ESA/Edfinancial • FedLoan Servicing (PHEAA) • Granite State – GSMR • Great Lakes Educational Loan Services, Inc. • MOHELA • Navient • Nelnet • OSLA Servicing • VSAC Federal Loans

10. Brookings and Perkins Repayment • Heartland ECSI is the loan servicer for these two loans • They can be contacted at 888-549-3247 • Their Website is www.heartlandecsi.com • Little tip: your school code is W30 and your account number is typically your social security number

11. Repayment Options Repayment Plans and Consolidation 11

12. Repayment Plans

13. Standard Repayment Plan Under this plan, the borrower will pay a fixed amount that ensures they pay their loan(s) in full within the repayment period. Payments will be at least $50 per month. For subsidized, unsubsidized, and PLUS loans, the repayment period is 10 years. For consolidation loans, the repayment period is 10-30 years, depending on the borrower’s total educational indebtedness. For borrowers who do not have consolidation loans, this plan results in the lowest total interest paid because the repayment period is shorter than it would be under any of the other repayment plans.

14. Extended Repayment Plan Under this plan, the borrower will pay a fixed or graduated amount in an amount that will ensure that they pay their loans(s) in full within 25 years. Fixed payments will be at least $50 per month. Graduated payments will be at least the amount of interest that accrues in a month. A borrower may choose this plan if: • He or she did not have an outstanding balance on a FFEL Program or Direct Loan as of October 7, 1998 or on the date they obtained a student loan after that dateand • He or she has more than $30,000 in outstanding FFEL Program loans or more than $30,000 in outstanding Direct Loans.

15. Graduated Repayment Plan Under this plan, the borrower will pay an amount that increases every two years and ensures that they pay their loan(s) in full within the repayment period. For subsidized, unsubsidized, and PLUS loans, the repayment period is 10 years. For consolidation loans, the repayment period is 10-30 years, depending on the borrower’s total educational indebtedness. The minimum payment equals the amount of interest that accrues monthly. No one payment will be more than three times greater than any other payment.

16. Income-Driven Repayment Plans

17. Eligible Borrowers

18. Eligible Loan Type

19. Consolidation: www.StudentLoans.gov • Interest rate is weighted average of consolidated loans • Interest rate is rounded to nearest higher 1/8 of 1%

20. Loan Consolidation • One lender and one monthly payment • Flexible repayment options • Reduced monthly payments • Fixed interest rate • Loan Consolidation Information Call Center at 1-800-557-7392 Note: Private loans are ineligible for federal loan consolidation

21. Income Sensitive Repayment Plan • Federal Family Education Loans (FFEL) • Low-income borrowers • Not applicable to those with Direct Loans • Payments increase or decrease based on income

22. Repayment Plan Summary Billy Borrower has $40,000 in Direct Loan debt, which has a 6% interest rate. His income is $35,000, he is single, and he lives in Colorado. His income increases at a rate of 5% per year. *Income-Driven Repayment Plans

23. Public Service Loan Forgiveness Borrower must also be employed by a qualifying organization at the time that the borrower applies for and receives PSLF According to the IRS, the forgiven amount is not treated as taxable income Details about the program: StudentAid.gov/public service

24. PSLF Requirements • Don’t wait to enroll if eligible!

25. PSLF - Qualifying Repayment Plan Income-driven plans are most likely to leave a remaining balance for forgiveness after 120 qualifying payments

26. PSLF – Qualifying Employment Doesn’t matter what the borrower’s job duties are. Borrower can work at multiple organizations while making the required 120 payments

27. www.StudentLoans.gov/repay

29. Repayment Estimator www.studentaid.gov/repay 29

30. Estimate your student loan payments! StudentAid.gov/repayment-estimator

31. Postponing Payment, Avoiding Default, Loan Discharge and Forgiveness

32. Deferment & Forbearance Reasons

33. Consequences of Default For most federal student loans, you will default if you have not made a payment in more than 270 days. 

34. Getting Out of Default

35. Discharge, Forgiveness, Cancellation

36. www.studentaid.gov/repaymentchecklist

37. Federal Student Aid Resources 37

38. StudentAid.gov

39. StudentLoans.gov Sign up for IBR, Pay As You Earn, ICR or REPAYE at StudentLoans.gov! 

40. NSLDS.ed.gov

41. Questions? • Contact your loan servicer. • If you do not know who you loan servicer is, visit NSLDS at nslds.ed.gov Federal Student Aid Information Center (FSAIC) 1-800-4-FEDAID (1-800-433-3243)