Repayment
After you graduate, leave school, or drop below half time enrollment (6 hours), you have a six-month grace period before repayment begins. During the grace period on a subsidized loan, you don't have to pay any principal and you won't be charged interest. During the grace period on an unsubsidized loan, you don't have to pay any principal, but you will be charged interest. As mentioned, you can either pay the interest or it will be capitalized.
Your lender will send you information about repayment, and you'll be notified of the date repayment begins. However, you are responsible for beginning repayment on time, even if you don't receive this information. Failing to make payments on your loan can lead to default.
The repayment periods for Stafford Loans vary from 10 to 30 years depending on which repayment plan you choose. When it comes time to repay, you can pick a repayment plan that's right for you:
- A 10-year Standard Plan with a minimum monthly payment of $50;
- An Extended Plan that allows you to repay your loan over a longer period;
- A Graduated Plan with a monthly payment that starts out low and then increases gradually during the repayment period; or
- An Income Sensitive Plan that adjusts your monthly payment up or down every year based on your annual salary. With this plan, it is possible to extend your repayment period beyond 10 years.
| Loan Amount | Minimum Monthly Payment | Years in Repayment | Total Interest Paid | Total Amount Paid |
| $2,500 | $50 | 5.1 | $579 | $3,079 |
| $3,000 | $51 | 6.3 | $841 | $3,841 |
| $5,000 | $61 | 10 | $2,360 | $7,360 |
| $7,500 | $92 | 10 | $3,539 | $11,039 |
| $10,000 | $123 | 10 | $4,718 | $14,718 |
| $12,500 | $153 | 10 | $5,898 | $18,398 |
| $15,000 | $184 | 10 | $7,078 | $22,078 |
| $20,000 | $245 | 10 | $9,437 | $29,437 |
| $23,000 | $282 | 10 | $10,852 | $33,852 |
What do you do if you think you might be in repayment trouble? First, call your lender, your servicer, or your guarantor TGSLC (Texas Guaranteed Student Loan Corporation). These organizations have lots of options to help make repaying your loan as easy as possible. Maybe you can't afford the payment plan you are under. Maybe you need to wait a while before beginning repayment. Maybe you can't find a job. One thing is certain - if you don't let someone know you need help, you won't receive any. If you find yourself having trouble managing your debt and ask for help, your lender or servicer can offer you options to help you get through a rough spot.
You are entitled to defer your student loan payments when applicable criteria are met. Through deferment you can postpone your scheduled student loan payments for various reasons, such as unemployment, economic hardship, and school enrollment. Your lender or servicer determines if you meet the requirements for a deferment. To ensure prompt processing of your deferment, please mail it directly to your lender or servicer. You can also get information and download the correct forms from TG's Adventures In Education web site at www.AdventuresInEducation.org and from TG Online at www.tgslc.org.
Forbearance is an option lenders or servicers can offer in which the lender permits the borrower to temporarily cease payments, allows an extension of time for making payments, or temporarily accepts smaller payments than were previously scheduled. Medical or financial problems that do not meet the requirements for a deferment might qualify you for forbearance. During a forbearance period, the borrower is responsible for paying the interest that accrues on any loan, even a subsidized loan. If a borrower fails to make required interest payments during a forbearance period, the lender may capitalize the unpaid accrued interest. A lender may grant a discretionary forbearance to assist a borrower or endorser in fulfilling the repayment obligations of the loan and to help prevent default. A borrower may request this forbearance by contacting the lender verbally or in writing. Contact your lender to obtain forbearance forms. Remember that the lender must approve the forbearance request before your payments can be suspended.
By consolidating your loans, you might be able to reduce your monthly payments. Your lender or servicer can help you decide if you are eligible and if loan consolidation is the best option for you. You can also get information and download the correct forms from TG Online at www.tgslc.org. For more information on managing repayment, you may call your lender, your servicer, or call TG at (800) 338-4752 or send an e-mail message to prevent.default@tgslc.org.