Repaying Student Loans

While you are enrolled at least half-time time (six credit hours as an undergraduate, or four credit hours as a graduate student) your student loans will be in an “in-school deferment” status.  This means you are not required to make payments on your federal loans.  It is a good idea, if you are able, to make payments on your loans while you are enrolled.  This will help reduce your overall indebtedness when you leave school.

Once your enrollment drops to less than half-time, your federal loans will enter a grace period status.  The grace period is a length of time during which you are not required to make payments on your loans.

The length of the grace period depends on the type of loan that you have borrowed.  Direct Loans have a six-month grace period while the Perkins Loan offers a nine-month grace period. Note that not all students will have Perkins Loans.  All student loans must be repaid, per your loan agreement/master promissory note.

Reduce your initial debt by borrowing less

Annual federal loan eligibility may be greater than your eventual earning potential. Those loan maximums might be more than you will be able to repay, damaging your credit rating. That, in turn, may increase the amount you pay in the future for credit, keep you from getting further credit entirely, or could mean higher insurance rates (in some states). So do not borrow more than you need!

Loan Repayment Steps

Step One: Identify Your Student Loans

Federal Student Loans - Sign in to the Student Aid to view the federal loans that you have borrowed.

Private Student Loans - Log in to MyNMU -> Financial Aid - Information -> Award -> Award History.  You will see the name and amount of each private loan that you have borrowed.

Step Two: Complete Exit Counseling

Direct Loan Exit Counseling is completed on-line at studentaid.gov/.  After logging in choose Complete Counseling then Exit Counseling.

Perkins Loan Exit Counseling may be completed on-line at www.uasconnect.com.  If you have questions about Perkins Loan Exit Counseling call 906-227-1428.

Step Three: Determine Your Federal Loan Servicer

The Direct Loan Exit Counseling confirmation page provides students with name of the federal loan servicer. You may also view your servicer's contact information on studentaid.gov/

Federal Loan Servicer

Contact

Aspire 

1-855-475-3335

Cornerstone Education Loan Services

1-800-663-1662

ESA/EdFinancial Services

1-855-337-6884

FedLoan Servicing (PHEAA)

1-800-699-2908

Granite State Management and Resources

1-888-556-0022

Great Lakes Educational Loan Services

1-800-236-4300

MOHELA

1-888-866-4352

Nelnet

1-888-486-4722

OSLA Servicing

1-866-264-9762

NAVIENT

1-800-722-1300

VSAC Federal Loans

1-888-932-5626

Perkins Loans

1-906-227-2062

Department of Education - Federal Student Aid 1-800-433-3243

Step Four: Create an Account on Your Servicer's Website

  • Find out when your grace period ends.
  • Find out when your first payment is due.
  • Determine your monthly payment amount.

Step Five: Choose a Federal Student Loan Repayment Plan

You may choose from the following repayment plans.  Be sure to review the terms and conditions of each repayment type and use the Repayment Estimator to calculate the payment plan that works best for you.  Some repayment plans require that you provide proof of your income.  This may be completed with your servicer or on studentaid.gov/

Step Six: Setup Repayment of Your Private Student Loans and Perkins Loan

Exit Counseling

Loan exit counseling

Just prior to graduation, or if you drop below half-time enrollment, you will need to complete loan exit counseling. This is an interactive tool that provides the information you need to know about repaying your federal student loans.

Our office will notify you to let you know how to get started with your exit counseling.

Exit counseling for a Federal Perkins Loan

Federal Perkins Loans are managed by NMU’s Perkins Loan Collection Office, and the exit counseling process is different.

Consolidate your loans

If you have more than one federal student loan, you may be able to consolidate them into a single loan with one monthly payment. This payment can be quite a bit lower than your total monthly payments on multiple loans.

Pros

Cons

  • You have a potential for lower monthly payments.

 

  • You may lose some discharge (cancellation) benefits if you include a Federal Perkins Loan in a consolidation loan
  • You will have a single monthly payment for multiple loans.

 

  • If you extend your repayment period, you may pay more interest over time.
  • The interest rate is fixed for the life of the loan.
  • Once a consolidation has been completed, you cannot reverse it—the original loans no longer exist, because they are paid off by the consolidation.
  • You may have flexible repayment options.

 

 

Defaulting

Defaulting on your Federal Direct or Perkins Loans

Failing to repay a loan according to the terms of the Loan Agreement/Master Promissory Note (MPN) you signed, means you may default on the loan. Default occurs if you do not pay on time or if you do not comply with other terms of your MPN.

What are the consequences of defaulting?

If you default on a federal loan, the government will take actions against you. You may:

  • Lose wages and tax refunds, which will be applied toward your unpaid loans
  • Lose eligibility for future student aid
  • Be unable to get a home, car, or other loan
  • Lose job opportunities or be unable to get a professional license
  • Damage your credit rating when your loan is reported to the national credit bureaus

Northern Michigan University’s Cohort Default Rate (CDR):

The Cohort Default Rate at Northern Michigan University for the 2017 Cohort is 9.3% percent.