Ah, the sweet smell of freedom…almost. The end of April signifies a few important things to college students: finals week (sigh) and approaching graduation for seniors (yay). It’s a great feeling to know that you will be done with the pressures of academia, but new challenges await you. One biggie is financial aid repayment. As the euphoria of freedom winds down, students realize that there are some major responsibilities to be had in paying back the money they borrowed for their education.
In light of this startling realization, it’s a good idea to get ahead of the game. As one expert puts it, “Know what you owe.” There are a few ways of figuring this out…
Before you leave school, head over to the financial aid office. For a quick refresher of what loans (and in what amounts) you took out at the beginning of your education so many years ago, ask the college financial aid office for any information they can give you regarding this. Talking to university financial aid personnel can give a student all the info they need in one stop—including how much total loan debt they have.
Keep an eye out for loan exit interview notifications. When you took out each education loan, you (or your parents, on your behalf) filled out lengthy applications which informed you of your responsibilities regarding the money that you were borrowing. The exit interview is a sort of survey or test that each borrower is required to complete to ensure that they still understand the responsibilities they have in paying the money back. As graduation approaches, or soon after, your lending organization will get in touch with you and prompt you to go to a website and complete this (for each loan). Information included may be various scenarios in which a loan is forgiven (waived) and how long the loan’s grace period is (usually 6 months). This will likely have a completion due date and will provide information on what you owe.
Check out the National Student Loan Data System . You know how a dictionary has information on every word in the English language? Well, the NSLDS is sort of like that, only it has loan info instead of definitions. On this site, you can find out thorough information on each and every loan you have taken out for school. Keep in mind that this applies only for federal loans, and any private loan information will need to be gathered and calculated by other means. Each loan entry will tell you how much you borrowed, when you borrowed it, what kind of loan it is (subsidized/unsubsidized), how much you owe on the loan (principal), how much is owed in interest, and much more helpful information.
Compare your records. Make sure you have an accurate picture of what you will need to repay by comparing the information you got from school, mailed notifications and the online system. Any discrepancies you find will have to be taken up with the corresponding offices/information sources, and maybe even the Department of Education.
Once you feel that you have a good idea of the loan debt you have, keep the information together and organized. You don’t want to be caught off guard upon forgetting about a loan, suddenly needing to scrape money together before your first payment is due. With each payment you make, keep a record of it—either written down or in the form of a payment receipt from the loan organization. If needed, make copies of canceled check records from your bank so that you know that payments were received and cashed, in case someone claims that a payment was not received.
The underlying messages here are simple: when it comes to students loans, be in-the-know and be organized. Such habits will make this daunting new responsibility easier to bear. Go Financial Aid is always here to help, so if you have a question or just want some more information, check out our solutions center or contact us.