Many students depend on student loans to pay for their education. But for most, they won’t make their first payment on that debt until after graduation. If you’re struggling to remember the details of that freshman year loan, learn what steps to take before you make your first student loan payment.
When Is Your First Student Loan Payment Due?
The majority of student loan payments aren’t due until after you leave school, giving you the chance to focus on your education rather than repaying your loan. This is different from traditional loans like mortgages, auto loans or personal loans—all of which require the first payment within a few weeks of disbursement.
If you’re a student with federal loans, your first payment will be due six months after you leave school, which is the standard grace period. If you’re a parent PLUS loan borrower, however, your debt will enter repayment as soon as the money is disbursed—though you can choose to defer payments if you want.
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If you have private student loans, your grace period is determined by your lender. Many allow borrowers to select their preferred repayment timeline. For example, borrowers can often choose between starting payments immediately after receiving the money, making small interest-only payments while in school or completely deferring payments until six or even nine months after graduation.
5 Steps to Make Your First Student Loan Payment
If you’ve recently graduated or dropped below half-time enrollment, your first student loan payment is likely approaching. Take these steps to make sure you start off on the right foot.
1. Find Your Loan Servicer
You might’ve already received letters or emails from your student loan servicer reminding you about your first payment. But if you haven’t gotten a letter or don’t know who your loan servicer is, now is the time to find out.
For federal student loan borrowers, log into the Federal Student Aid website to view the details about your aid, including federal student loans. It should list all the information about your loan, such as your balance, interest rate, servicer and first due date.
If you have private student loans, you can get a free credit report from AnnualCreditReport.com. Your report will outline your credit and loan accounts, and you can find the relevant lenders there. Create an account on the lender’s website or contact them directly to see when your first payment is due. If you have multiple loans through more than one lender, you’ll need to contact each one individually.
2. Review Your Interest Rate and Loan Term
If you have several different student loans, you might have different interest rates for each of them. The interest rate on federal student loans changes every year, so the loan you took out as a freshman and the loan you took out as a senior will likely have different rates.
Also note your loan terms, which indicate how long it will take you to repay your debt. Most federal loans start in a 10-year repayment plan, while private loans usually allow you to choose your term when you take out the loan. Longer loan terms typically result in lower monthly payments, but you’ll pay more in interest charges than you would with a shorter repayment period.
3. Compare Available Payment Plans
If you have private student loans, you likely selected your repayment plan when the money was first disbursed. Review the rules of your plan and make note of the payment amount and due date. If you think you’ll have trouble affording your payments, reach out to your lender and see if they offer alternatives that can help you.
If you have federal student loans, however, you can select your plan when you begin repayment (and change it at a later date if you choose). If you take no action, you’ll be automatically enrolled in the standard repayment plan, which offers fixed monthly payments over 10 years.
However, alternatives are available if your monthly payments are too high under standard repayment. For example, you may be eligible for an income-driven repayment (IDR) plan. These plans base your payments on your income and household size. Plus, the remainder of your debt will be forgiven after 20 or 25 years, depending on which IDR plan you choose.
You can also explore other federal repayment options, including:
- Graduated repayment plan. Payments start lower and gradually increase, usually every two years. You’ll pay off most loans in 10 years.
- Extended repayment plan. You’ll have fixed or graduated payments, and your loans will be paid off within 25 years. Borrowers must owe more than $30,000 to qualify.
Not every borrower is eligible for every federal repayment plan, so review the guidelines carefully before choosing. If you plan to pursue forgiveness options such as Public Service Loan Forgiveness (PSLF), there are additional repayment requirements you must follow. It pays to read the fine print before you make your first payment.
4. Consider Autopay
After you’ve reviewed your repayment options, consider enrolling in autopay. This service automatically deducts your monthly payment from your bank account, ensuring that you won’t miss a payment. Plus, many lenders offer an interest-rate discount (usually 0.25%) for borrowers enrolled in autopay.
However, autopay can cause problems if you have inconsistent income or live paycheck-to-paycheck. You run the risk of overdrafting your bank account if you don’t have enough to cover your loan payment—which would likely result in additional fees from your bank and loan servicer.
If you don’t want to set up autopay now, create a calendar reminder to help you remember to make your loan payments manually each month.
5. Make Your First Payment
Now that you’ve gathered all the details, it’s time to make your first payment. Register with your loan servicer’s website and keep the login details handy, whether that’s on a notepad near your desk or in a password manager.
Each loan servicer has its own way of handling payments. Bookmark the payment site so you can easily get there when you need to make a payment. If you set up autopay, keep an eye on your inbox. You should get details that your payment is scheduled to be deducted from your account on a set day or you’ll get a notification when the payment is completed.
Plan for the Long Term
Repaying student loans is a marathon, not a sprint. And like any long-term commitment, you may run into issues or hiccups along the way.
If you ever have trouble making payments, contact your loan servicer right away. Explain your situation and ask about alternative payment plans. Most lenders offer deferment or forbearance options, which temporarily pause your student loan payments without penalty. If you’re on a federal income-driven plan and you lose your job or face a pay cut, you could even lower your payments to $0.
If you find yourself with cash to spare, you might consider making extra payments on your student loans. Doing so can help you pay off your debt early and potentially save you thousands of dollars in interest.
Even if you’ve set your loans on autopay, be sure to check in occasionally to see the progress you’re making. You can reevaluate your payoff strategy periodically and make sure it still makes sense for your current financial situation.