Repaying Your Student Loans

Once you are no longer enrolled in and attending at least six credit hours, repayment of your federal student loans begins after a six-month grace period. During the grace period, you will receive repayment information from the loan servicer, including the first payment due date (interest accrues on both loans but payments are not enforced).

Information on the servicer assigned to your student loans can be found at National Student Loan Data System (NSLDS).

Also see Direct Parent PLUS loan repayment information.

Repayment Plans

The Federal Direct loan program offers several repayment plans that are designed to meet the different needs of individual borrowers. Generally, students have 10 to 25 years to repay their loan, depending on the repayment plan that they choose.

Detailed information on repayment options is provided during the mandatory Entrance Loan Counseling and Exit Loan Counseling sessions.

Sample Loan Repayment Schedule

Examples of typical Federal Direct Loan and Federal Parent PLUS Loan Repayment plans to illustrate the differences in monthly payments based initial loan debt and choice of repayment plan.  These examples do not include all the repayment plan options and are for estimation purposes only. To get a better idea of your estimated monthly repayment options based on your specific loan debt, use the Department of Education’s online calculatorAlso see Federal Student Aid, Repayment Plans.

Payments in each of the following repayment options are calculated using the fixed interest rate of 6.8%.

Repayment Option: Standard

Initial debt when you enter repayment Per Month # of Months Total Repaid
$3,500 $50 90 $4,478
$5,500 $63 120 $7,595
$10,500 $121 120 $14,500
$17,000 $196 120 $23,476
$25,000 $288 120 $34,524
$40,000 $460 120 $55,239
$57,500 $662 120 $79,405

Repayment Options: Extended

Initial debt when you enter repayment Per Month # of Months Total Repaid
$3,500 Not available for this amount.
$5,500 Not available for this amount.
$10,500 Not available for this amount.
$17,000 Not available for this amount.
$25,000 Not available for this amount.
$40,000 $278 300 $83,289
$57,500 $399 300 $119,727

Repayment Options: Graduated

Initial debt when you enter repayment Per Month # of Months Total Repaid
$3,500 $23–$70 120 $5,201
$5,500 $37–$110 120 $8,173
$10,500 $70–$209 120 $15,603
$17,000 $113–$339 120 $25,262
$25,000 $166–$498 120 $37,150
$40,000 $266–$797 120 $59,440
$57,500 $382–$1,145 120 $85,445

Repayment Option: Income Contingent—Single*

Initial debt when you enter repayment Per Month # of Months Total Repaid
$3,500 $26–$33 209 $6,098
$5,500 $41–$51 209 $9,583
$10,500 $78–$98 209 $18,295
$17,000 $127–$158 209 $29,621
$25,000 $186–$232 209 $43,561
$40,000 $298–$372 209 $69,707
$57,500 $298–$560 248 $114,608

* Assumed Adjusted Gross Income of $30,000, Household Size of 1, and State of Residence as Iowa.

Repayment Option: Income Contingent—Married**

Initial debt when you enter repayment Per Month # of Months Total Repaid
$3,500 $25-$33 225 $6,380
$5,500 $39-$51 225 $10,025
$10,500 $75-$98 225 $19,139
$17,000 $121-$159 225 $30,987
$25,000 $154-$237 231 $46,576
$40,000 $154-$423 274 $88,667
$57,500 $154-$644 300 $127,891

** Assumed Adjusted Gross Income of $30,000 for each student and spouse (total $60,000), Household Size of 3, and State of Residence as Iowa.

Inceptia websiteInceptia Provides Loan Repayment Assistance

You’re not alone when it comes to student loans. Hawkeye Community College has partnered with Inceptia, a division of National Student Loan Program (NSLP), to provide you with FREE assistance on your Federal student loan obligations to ensure successful, and comfortable, loan repayment. Inceptia’s friendly customer representatives may reach out to you if your loan(s) become delinquent. Inceptia is not a collection agency. We’ve partnered with them to help you explore a wide variety of possibilities such as alternative repayment plans, deferment, consolidation, discharge, forgiveness, and forbearance options. Inceptia will stay in touch with you via phone calls, letters, and/or emails to help you find answers to your questions and solutions to your issues.

Consequences of Default

You are responsible for repaying your student loans even if you do not graduate, have trouble finding a job after graduation, or if you are not satisfied with your education. If you do not make any payments on your student loans for over 270 days and do not make special arrangements with your lender to get a deferment or forbearance, your loans will go into default. Defaulting on your student loans has serious consequences, such as:

  • Your loans may be turned over to a collection agency at which point you are now responsible for the very high collection agency fees.

  • Your wages may be garnished and you can be sued for the entire amount of your loan.

  • Your federal and state income tax refunds may be intercepted or your Social Security benefit payments can be withheld.

  • Your defaulted loans will appear on your credit record. A bad credit record can affect your ability to purchase a car, home, and credits cards. It may also affect your ability to find a job.

  • You may lose eligibility to receive any more federal financial aid until you make proper arrangements.

Postponing Repayment

The two options available for postponing repayment of your student loans are deferments and forbearances. Stay in contact with the lender, they will help you determine if you are eligible for a deferment or forbearance BEFORE you default.

Deferments

The lender allows you to postpone repaying the principal of your loan for a specific period of time, making your debt more affordable. Contact your lender for more specific information regarding this process.

Forbearances

During forbearance, the lender allows you to postpone or reduce your payments, but the interest charges continue to accrue. Contact your lender for more specific information regarding this process.

Getting Out of Default

To get out of default, you need to make arrangements with your servicer or lender to repay the loan. Once you have made six regular payments, you will be eligible for additional Title IV aid. After you have made twelve regular payments and applied for and received "rehabilitation", you will no longer be considered in default. At this time, record of the default will be removed from the reports to credit reporting bureaus.

For information about your options, contact the servicer of the loan and/or the original lender. If you do not know who currently is servicing your loan, create an account with the National Student Loan Data System (NSLDS).

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