Rights & Responsibilities

Half of all students have taken out at least one educational loan over the course of their schooling. If you've completed your graduate or doctoral degree, you probably have Federal or private loans to repay. Make sure you're aware of your rights and responsibilities of loan repayment. 

Beginning the Repayment Process 
The first step to repaying your loans properly and protecting your credit lies in understanding the terms of your student loan. The grace periods of any loan you received as an undergraduate, graduate, or doctoral student will likely begin once you graduate or leave school for any reason.

Most grace periods are set at six months, though each type of loan will have its own individual terms. The minimum monthly payment will likely be $50, and the standard repayment period is ten years, though you may be able to request a change to the monthly payment as well as the repayment period, if necessary. If you received a Federal student loan, the school or your lender is required to provide you with exit counseling. Attend your loan's exit counseling and make sure you understand the repayment options.

Your Loan's Details  
You received written information with repayment details when you first signed your loan contract and again in your exit interview. Your student loan rights and responsibilities include: 

• Your interest rate and loan details
• Disclosure of the full amount of your loan
• Any additional penalties or fees

In most cases, you're also entitled to a statement confirming that you can repay your loan early and without penalty. Once you've paid your loan in full, you're entitled to notification of that fact.

Your Loan Repayment Rights
If you have difficulty making payments on your loan, don't let it go into default without speaking with your lender. You may be able to request a deferment or forbearance. A deferment, or postponement of your payment schedule, is often available to graduates who enter the armed forces, the Peace Corps, or continue their schooling. A forbearance will temporarily reduce your loan payments, sometimes extending your total repayment timeline.

Alternative repayment plans, such as graduated or income-sensitive repayment, may also be available. Cancellation may also be an option for Federal loans, depending on the career you choose. Contact your school's financial aid department or your private lender for more information on your loan repayment rights.

Your Loan Repayment Responsibilities 
Making timely payments is your biggest loan responsibility. You must repay the loan even if you weren't satisfied with your degree program, you can't find a job, you left your educational program early, or if you don't receive a monthly bill. Failure to make timely loan payments can result in a default. You should avoid defaulting on your loan, which can affect your credit rating and your subsequent purchasing power for years to come.

Educate yourself about the rights and responsibilities of your student loans, and you can build good credit as you work your way toward becoming debt-free.