Repayment of Federal Stafford Loans
When you graduate, withdraw or are no longer enrolled in college at least half-time, you have a grace period — a period of time before you must begin making monthly payments on your Federal Stafford Loan(s). The grace period for Federal Stafford Loans is six months.
During the grace period you will begin receiving information from your lender about your Federal Stafford Loan(s). This information is generally called a Repayment and Disclosure Statement. The statement itemizes how much you borrowed, the amount of interest that accrued on the loan(s), the amount to be paid back in total and the date you must begin making monthly payments.
Normally you will have 10 years to repay your Federal Stafford Loan(s), but there are several repayment options. These options allow you to manage your payments by lowering the monthly payment amount and extending the number of years to repay your loan(s). You can also manage payments by consolidating your loans. Loan consolidation allows you to refinance any or all of your unpaid federal student loans and create a single new loan with one monthly payment. The new loan will have a fixed interest rate, new terms and may have an extended repayment period of up to 30 years.
It is important to keep your lender advised of address, telephone or name changes so that you receive monthly statements in time and can make your payments by each due date.
What if You Can't Make a Payment?
If you are unable to make a payment, you may be eligible for a deferment or a forbearance of your loan payments for a period of time.
Defaulting
Defaulting on a Stafford Loan
If you default on your Federal Stafford Loan(s), your default will be referred to collections and reported to credit bureau organizations. You will lose eligibility for any future federal financial aid — not only Federal Stafford Loans but federal grants and Perkins Loans.
Remember, while repaying your student loans can help you establish a good credit rating, default has many negative consequences.
Contact your lender if you have any questions or concerns regarding repayment of your Stafford Loan(s).
Our
Loan Repayment Guide will help you understand what you need to know about the benefits of a good repayment record and the penalties if you do not pay off your loan in accordance with its terms.