NASFAA Offers Repayment Advice As Six-Month Grace Period for Student Loan Borrowers Draws to a Close

Contact: Beth Maglione
(202) 785-6944

Make A Smooth Transition Into Student Loan Repayment With These Tips From Financial Aid Administrators

Nov. 7, 2013 -- November is not all football games and turkey dinners. This month also marks the end of the six-month, federal student loan “grace period” for Class of 2013 college graduates—and now those loan payments are about to come due for the first time.

“Determining the best repayment strategy for you and your family is absolutely vital—and thankfully there are a number of options that make repayment more manageable,” said Justin Draeger, president of NASFAA. “Sticking to a plan is just as important, because defaulting on your student loans is a ‘lose-lose’ proposition—students who default could suffer the negative effects of that credit damage for years to come, and taxpayers are on the hook for the defaulted loan.”

While any debt burden may seem daunting, there’s good news for borrowers at the end of their grace periods: Repayment options are built into the programs to help borrowers repay at a rate they can handle. The National Association of Student Financial Aid Administrators (NASFAA) has tips to help borrowers make the transition into repayment with ease.

First, borrowers should investigate their total outstanding debt burden. Interest accrues during grace periods, likely increasing the total borrowers think they owe. Locate all your loans online through the National Student Loan Data System, and contact your student loan servicer to ask any questions about your total debt balance and payment schedule.

Once you know how much you owe, investigate all repayment options available to federal student loan borrowers. The U.S. Department of Education recently launched a new initiative to inform struggling borrowers about loan repayment alternatives and keep the obligation affordable, regardless of current or temporary financial setbacks.  While the standard, 10-year repayment plan may be right for some graduates, others may benefit from a longer repayment term.

Federal student loan borrowers may also qualify for income-based repayment, which ties loan repayment amounts to monthly earnings to keep payments affordable. Borrowers who work in certain public-service jobs may also qualify for Public Service Loan Forgiveness, which eliminates remaining debt after qualified workers make payments for 10 years.

Don’t hesitate to reach back to your college’s financial aid office with questions about selecting the right repayment option for you. In addition, the U.S. Department of Education has a variety of online resources to help borrowers select a repayment plan and stay on track.

Above all, student loan borrowers should avoid delinquency and default. Once a payment is 270 days late, the borrower may face severe consequences, including lawsuits, additional charges, and garnished wages and tax refunds. Explore NASFAA’s additional tips for struggling borrowers, or contact the organization for more information. By kicking off on-time payments this November, borrowers will position themselves to get out of debt responsibly.

To schedule an interview with a NASFAA spokesperson, please contact or call (202) 785-6944.


The National Association of Student Financial Aid Administrators (NASFAA) is a nonprofit membership organization that represents nearly 20,000 financial aid professionals at more than 3,000 colleges, universities, and career schools across the country. NASFAA member institutions serve nine out of every ten undergraduates in the U.S. Based in Washington, DC, NASFAA is the only national association with a primary focus on student aid legislation, regulatory analysis, and training for financial aid administrators. For more information, visit