What if I can’t afford a payment?
See the playlist: Trouble with repayment
Falling behind, or not making any payments, on your student loans has serious consequences. It is important to take action. If you don’t, here’s what can happen:
- Damage to your credit: making it hard to get a cell phone, car loan, mortgage, or even rent an apartment.
- You’ll owe more money: interest accrues and increases the amount of money you owe.
- You’ll get sent to collections: your wages could be garnished to pay your loan bill.
What happens if I can’t make my payments?
If you’re having trouble paying your loan bill, the first thing you should do is contact the servicer of your loan. They want your loans to stay in good standing and can help you find ways to get back on track. See instructions for finding your servicer contact info here: Studentaid.gov: who’s my loan servicer?
To get back on track, you may be able to:
Change due date
- What is it? You may be able to change the date your payment is due each month.
- Who is it for? Changing your due date is for borrowers having a hard time paying their bill on time.
- Perks of a new date: Borrowers can stay current on all their bills when they can strategically set their due date for their student loans.
- How to make it happen: Contact the servicer of your loan and explain your timeline. They may be able to adjust your due date so you can pay all of your bills on time.
Change repayment plan
- What it is? You may be able to choose a different repayment plan that offers a more affordable monthly payment.
- Who is it for? There are a few different types of repayment plans to suit different financial situations – see Repayment Plans for a breakdown of the different repayment plans.
- Perks of changing your repayment plan: You get more affordable payments while still making progress towards paying off your loans.
- How to make it happen: Contact the servicer of your loan and ask about your repayment options.
Deferment
- What it is? Deferment is a way to postpone payments on your loan.
- Who is it for? Deferment is for borrowers who are unemployed, have extreme economic hardship, go to school at least half-time, or are on active military duty.
- Perks of deferment: One of the benefits of deferment is the federal government will pay the interest on your subsidized loan during a deferment.
- How to make it happen: Contact the servicer of your loan and explain your situation. They’ll see if you meet the qualifications for deferment.
Forbearance
- What it is? Forbearance is a way to postpone payments on your loan.
- Who is it for? Forbearance is for borrowers who are having trouble making their loan payments. Forbearance is granted at the discretion of the servicer on a case-by-case basis.
- Perks of forbearance: there are not a lot of perks that come with forbearance… it just gives you a little time to get your finances together. During forbearance, the interest on your loans will continue to accrue, increasing the total amount you owe.
- How to make it happen: Contact the servicer of your loan and explain your situation. They will consider your situation and let you know what options you have.
