If you recently graduated, left school, or dropped below half-time enrollment, you might be wondering, “When do you start paying back student loan?” For most federal student loans, you have a six-month grace period before your first payment is due. Private loans vary, but many also offer a grace period of six months, though some may require payments while you are still in school.
Understanding the Grace Period
The grace period is a set time after you leave school or drop below half-time enrollment before you must begin repaying your loan. For federal Direct Subsidized, Direct Unsubsidized, and Federal Family Education Loans, the grace period is six months. For Perkins Loans, the grace period is nine months, but Perkins Loans are no longer issued after September 2017.
During the grace period, you are not required to make payments, but interest may accrue on unsubsidized loans. If you have a subsidized loan, the government pays the interest during the grace period.
When Payments Begin for Federal Loans
Your first payment is due after the grace period ends. For example, if you graduate in May, your grace period ends in November, and your first payment is typically due in December. The exact date is set by your loan servicer and appears on your billing statement.
You can also choose to make payments during the grace period to reduce the total interest you will pay. Making voluntary payments early can save you money in the long run.
Private Student Loan Repayment Start Dates
Private student loans have different terms, so check your loan agreement. Some private lenders offer a six-month grace period after graduation, while others may require monthly payments while you are still enrolled. If you have a private loan, contact your lender to confirm when your first payment is due.
| Loan Type | Grace Period | When Payments Start |
|---|---|---|
| Federal Direct Subsidized | 6 months | After grace period ends |
| Federal Direct Unsubsidized | 6 months | After grace period ends |
| Federal Perkins Loan | 9 months (no new loans) | After grace period ends |
| Private Student Loans | Varies (often 6 months) | Check your loan agreement |
What Happens if You Return to School?
If you return to school at least half-time before your grace period ends, your grace period is reset. You will get a full six-month grace period again when you leave school. This can be helpful if you are planning to pursue further education.
However, if you use up your grace period and then go back to school, you will not get another grace period for the same loan. You will need to start repaying as soon as you leave school again.
Options if You Cannot Make Payments
If you are struggling to make your first payment, you have options. For federal loans, you can apply for an income-driven repayment plan, which caps your monthly payment based on your income and family size. You can also request a deferment or forbearance, which temporarily pauses your payments.
It is important to contact your loan servicer as soon as you know you cannot make a payment. Ignoring your payments can lead to default, which has serious consequences like damaged credit and wage garnishment.
Tips to Prepare for Repayment
- Know your loan servicer and set up an online account.
- Calculate your monthly payment using the repayment estimator on the Federal Student Aid website.
- Consider setting up automatic payments to avoid missed due dates.
- Review your budget and see where you can cut expenses to free up money for loan payments.
- Explore loan forgiveness programs if you work in public service or certain professions.
Special Circumstances That Change Your Start Date
Some situations can change when you start paying back your student loan. For example, if you are called to active military duty for more than 30 days, you may be eligible for a deferment that postpones payments. Similarly, if you are in a graduate fellowship or rehabilitation training program, you may qualify for a deferment.
Always check with your loan servicer to see if you qualify for any postponement options. Each situation is unique, and your servicer can provide the most accurate information for your loans.
Summary
In short, you start paying back your student loan after your grace period ends, which is typically six months after you leave school or drop below half-time enrollment. Private loans may differ, so review your loan agreement. If you cannot afford payments, contact your servicer immediately to explore options like income-driven repayment or deferment. Planning ahead and knowing your due date can help you avoid default and keep your finances healthy.
Frequently Asked Questions
How long is the grace period for federal student loans?
For most federal student loans, the grace period is six months. Perkins Loans have a nine-month grace period, but no new Perkins Loans are issued.
Do I have to make payments while I am still in school?
For federal student loans, you are not required to make payments while you are enrolled at least half-time. Private loans may require in-school payments, so check your loan agreement.
What happens if I don’t make my first payment on time?
If you miss your first payment, you may be charged a late fee and your credit score could be affected. Contact your loan servicer right away to discuss options.
Can I change my repayment plan after I start paying?
Yes, you can switch to a different repayment plan, such as an income-driven plan, at any time. Contact your loan servicer to make the change.
Is there a way to postpone my first payment?
You may be able to request a deferment or forbearance if you have a qualifying reason, such as unemployment or economic hardship. Contact your loan servicer to apply.
