Managing Student Loan Debt

The Financial Aid Office strives to educate students on all aspects of their student loans. Students borrowing federal loans are required to complete entrance loan counseling before they receive the first disbursement of their Federal Direct or Perkins Loan. In addition, before graduation students who have borrowed federal loans are required to attend group exit loan counseling sessions where they learn valuable information about repaying their federal student loans and receive instruction on how to complete the required online exit counseling.

Students are encouraged to track both their federal and private loan debt. Saint Mary’s College recommends that each student be aware of the following information for each loan she has borrowed:

  • The name of the lender and/or loan servicer
  • The original principal amount borrowed
  • The amount of fees associated with the loan
  • The interest rate
     
    • Whether the interest rate is variable or fixed
    • If the interest rate is variable, how often it changes and how the variable rate is calculated
    • Whether or not interest accrues while the student is enrolled in school
    • Whether or not the student has any options for lowering her interest rate
       
  • When repayment of principal begins
  • The amount of interest that may be accumulating on the original loan balance
  • An estimate of the minimum monthly repayment upon graduation
  • The length of time she will need to repay the loan

For federal loans, students can learn most of this information by logging onto the National Student Loan Data System (NSLDS). Students who have private loans can receive this information by contacting their private loan lender.

The Financial Aid Office at Saint Mary's College is always available to assist students with gathering the data needed to manage student loans. Students needing assistance from the Financial Aid Office should call the office at (574) 284-4557 and make an appointment with a financial aid counselor.

Deferment and Forbearance

A deferment is a postponement of payment on a loan, during which interest does not accrue if the loan is subsidized. You may qualify for a deferment while you are:

  • Enrolled at least half time in an eligible postsecondary school or studying full time in a graduate fellowship program or an approved disability rehabilitation program.
  • Unemployed or meet our rules for economic hardship (limited to 3 years).

If you can't make your scheduled loan payments, but don't qualify for a deferment, you may be eligible for a forbearance. A forbearance allows you to temporarily stop making payments on your loan, temporarily make smaller payments, or extend the time for making payments. Some common reasons for getting a forbearance are illness, financial hardship or serving in a medical or dental internship or residency.

More information about deferment and forbearance is available here.

Loan Cancellation or Discharge

Under certain conditions, you can have all or part of your federal loan cancelled or discharged. More information about these options is available here.

Loan Consolidation

Consolidating (combining) your loans is an option for your federal student loans, but most private alternative loans do not offer a loan consolidation option. There may be advantages to consolidating federal student loans into one loan, for example having the convenience of making one single monthly payment. Consolidation generally extends the repayment period, resulting in a lower monthly payment. While this may make it easier for borrowers to repay their loans, borrowers will pay more interest if they extend the repayment period since they will be making payments for a longer period of time.

Loan Repayment Calculator

The Federal Department of Education has a repayment calculator which you can use to estimate your repayment obligation.  This free, online tool will show you how your repayment terms can vary based on different repayment plans.  For each loan repayment plan the calculator will show you many months you will need to make payments, what your monthly payment amount will be, how much interest you will pay over the life of the loan, and the total amount you will repay.