With most Student Loan Scout lenders, there are several options for the repayment of your student loan. You may:
• Begin repayments immediately which will result in the lowest total student loan cost.
• Make fully amortized payments at the end of your grace period (six months after leaving school or reducing your attendance to below half-time).
• Make interest only payments while you are in school. This will increase the overall cost of your student loan, but can help you as you work to manage your budget.
For undergraduate and graduate students who choose to defer both principal and interest while in school, there is usually a six-month grace period following graduation or the time the student ceases to be enrolled at least half-time before repayment of principal and interest begins. For undergraduate students who choose immediate repayment of interest only or immediate repayment of both principal and interest, repayment of interest or principal and interest generally begins 30-45 days after disbursement. Interest, however, continues to accrue during the grace period.
Once repayment begins, most lenders require a minimum monthly principal and interest payment, typically $50 per month. Interest-only payments will be determined by the loan amount.
You can reduce student loan interest rate costs by accelerating the repayment of your loan and reducing your loan principal and subsequent interest. One option is to increase your monthly payment. The additional amount you pay goes directly to reducing the principal. If you are faced with problems repaying your loan, it's your responsibility to contact the holder or “servicer” of your loan immediately. There are several options available, including deferment and forbearance.