The basics of repaying loans
When you’ll start repaying loans depends on the type of loan you choose. Some require you to start paying them back while you’re still in school, while others start after you graduate. But all loans must be repaid.
Don’t be fooled by federal maximum loan amounts. Those are the maximum limits for all borrowers and aren’t related to your own personal earning potential. The maximum amount you’re eligible to borrow may be more than you’re able to repay. If you aren’t able to repay your education loans, you could seriously damage your credit rating. That could make it hard to get other types of consumer loans.
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Mind your interest
On Federal Direct Unsubsidized Loans and Federal Direct PLUS Loans, the government starts charging interest as soon as we receive the loan funds. You can pay the interest while in school or capitalize it (have it added to the principal) and begin repaying it after you graduate.
Paying the interest while in school will help you reduce your payments later. When interest is capitalized, the loan principal increases—which means that each time interest is figured, it’s figured on a larger amount.
Loan exit counseling
When you’re about to graduate, or if you drop below half-time enrollment, you’ll be asked to complete loan exit counseling for your Federal Direct Loans. Exit counseling will give you the information you need to know about repaying your federal student loans. The exit counseling process for Federal Direct Loans is different from other student loans such as a Health Professions Loan or a Federal Nursing Loan.
No matter what kind of loan you have, we’ll send you email to let you know how to get started with your exit counseling.
Learn more about exit counseling