Complete mandatory exit counseling. All federal student loan borrowers must complete exit counseling. Exit counseling provides important information you need to help you prepare for repayment of your loans. Check with your school to find out how they want you to complete exit counseling. Schools have different requirements. If you can afford it, make loan payments while you’re in school, especially if your loans are accruing interest. Making payments early can reduce the interest you pay and the cost of your loan over time. AFTER YOU GRADUATE OR LEAVE SCHOOL Know when you have to start making payments. For most loans, you’ll have six months — or nine months for Federal Perkins Loans — after you graduate, leave school, or drop below half-time enrollment before you must begin making your loan payments. Take this time to make a plan for repayment. Create a budget. Create a budget to determine how much you can realistically afford to pay monthly toward your student loans. Get help creating a budget. Consider loan consolidation. A Direct Consolidation Loan allows you to combine all of your federal student loans into one loan with one monthly payment. Loan consolidation can be helpful if you have multiple servicers, loans from the Federal Family Education Loan (FFEL) Program, or Federal Perkins Loans. Loan consolidation can increase your chances of qualifying for an affordable repayment plan and loan forgiveness options, but it may not be the best option for you. Learn more about loan consolidation. Set a goal for repayment. After you know how much you can afford to pay each month, set a goal for repaying your loans. To begin setting your goal, ask and answer this question: “Do I want to repay my loans quickly, or do I want to pay as little as possible per month?” You can’t choose both options. Any time you lower your payment, you’ll be in repayment for a longer time and you’ll pay more interest on your loans. If your financial situation changes, you can change your repayment plan at any time. If you have questions about your loan repayment options or the process, contact your loan servicer. Select an affordable repayment plan. Now that you’ve set a goal for repayment, you can find a repayment plan that fits your goal using Loan Simulator. • If you want to pay your loans off quickly and you can afford to do it, select the Standard Repayment Plan. Unless you consolidate, your loans will be paid off after 10 years of payments. • If you want to have the lowest monthly payment or can’t afford to make payments under the Standard Repayment Plan, select an income-driven repayment (IDR) plan. Under an IDR plan, payments are based on your income and family size. You will usually have lower monthly payments than other plans and may have payments as low as $0 per month.
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