Rights and Responsibilities of Student Loan Borrowers
Remember to keep in mind your rights and responsibilities as a student loan borrower:
- I am obligated to repay my loan(s), including all accrued interest and deducted fees, even if I do not complete the program, cannot find employment or am dissatisfied with the program of study.
- I have a maximum of ten years to repay my loan(s) (unless I choose to consolidate my loans).
- I may repay all or part of my loan(s) without penalty.
- The minimum monthly payment is $50. The payment may be larger depending on the amount borrowed. I will begin to repay my loan(s) after a 6-month grace period.
- The interest rate of my loan(s) is specified in the Notice of Loan Disclosure and Guarantee Statement that will be sent after the loan application is processed. Most current loans have a variable rate with an 8.25% cap.
- I must notify my lender or holder of my loan(s) within 10 days if I:
- Change my name
- Change my address/phone number
- Change my graduation date
- Transfer to another college/university
- Enroll for less than or drop below half time
- Withdraw from school
- I will be notified in writing if my loan(s) is transferred to a new holder. I must direct all correspondence to the new holder.
- If I qualify for a deferment, I will contact my lender or holder of the loan(s) to apply.
- If I do not qualify for a deferment but am unable to make monthly payments, I will contact my lender or holder of the loan(s) and request forbearance.
- If I do not repay my loan(s), I will be considered in DEFAULT and the following may result:
- It will be reported to a National Credit Bureau and have a negative effect on my credit rating.
- The entire unpaid balance plus interest will become due immediately.
- I will be ineligible to receive any additional federal aid.
- My wages and federal and state income tax returns will be garnished.