Out-of-date contact information

If you have moved, changed your cell phone or your email address, make sure you notify your loan servicer.  They can only assist you if they can contact you.

Paying for student loan help

The U.S. Department of Education and their loan servicers do not charge any fees for any help or services that they provide.  Ads claiming to help you lower your payment or apply for loan forgiveness for a fee are typically scams and should be avoided.  Contact your loan servicer for free student loan help.

Choosing the wrong repayment plan

Your repayment plan will determine how long it will take to pay back your loans, as well as your monthly loan payment.  Before choosing a plan, decide whether your goal is to pay of the loan quickly or to have a low monthly payment.  You can compare options using a repayment calculator.  For those interested in seeking Public Service Loan Forgiveness, the income-driven repayment plan provides the most benefits. 



Pay Your Loans Off Quickly

Have a Low Monthly Payment

Plan you should choose

10-year standard repayment plan

An income-driven repayment plan

Monthly payments

Usually higher

Usually lower

Repayment period

10 years

20 or 25 years

Total amount paid

Usually less

Usually more

Not consolidating your loans when you should

If you received federal student loans before 2011, you should consider consolidating your loans in order to receive better repayment options.  Be sure you review the pros and cons of consolidation before taking action. 

Not setting up automatic payments

Don't miss a payment!  Sign up for an automatic payment through your loan servicer and monthly payments will be automatically deducted from your bank account. 

Paying extra (when you can)

Student loan interest accrues every day.  One way to reduce the amount of money paid towards interest is to pay a little extra whenever you can.  Be sure to tell your servicer that the extra payments should not be put towards any future payments and should be applied to the highest interest rate loan.  

Paying late or missing payments

Missed or late payments will hurt your credit score and will affect your ability to secure loans in the future.  Missing multiple payments will send your loan into default, resulting in garnished wages and witholding from your tax refund. If you are having trouble making payments, contact your loan servicer as soon as possible to discuss reducing your monthly payment or even postponing your payment.  The worst thing you can do is stop paying your loan. 

Postponing payments without considering other options first

You can temporarily stop (postpone) payments on a student loan by applying for deferment or forbearance.  These options are helpful if you are experiencing a temporary hardship, but are not a good long-term solution.  Interest will continue to accumulate even while you are not making payments.  Before choosing deferment or forbearance, consider other options