Loan Repayment


Repayment Plans

It is important to keep in contact with your loan servicer in order to stay current on loan repayment.

Federal Student Loan Repayment

Repayment on federal student loans begin six months after a student ceases to be enrolled at least half-time in a degree seeking program.

There are various repayment options available to students to help make their repayment manageable. It is important to discuss your options and eligibility for all loan repayment options with your loan servicer.

Repayment Options

There are several repayment options available to borrowers to help make monthly payments manageable. Contact your loan servicer to discuss your eligibility for a particular repayment option.

The U.S. Department of Education has a Repayment Estimator available online to help calculate your potential payment under a certain plan.

Standard Repayment Plans
Plan Eligible Loans Term Monthly Payment Other Info
Standard Repayment
  • Subsidized and Unsubsidized Stafford Loans
  • Parent and Graduate/Professional PLUS Loans
Up to 10 years Payments are fixed. Minimum payment of at least $50 per month. The borrower will pay less interest over time under this plan.
Graduate Repayment
  • Subsidized and Unsubsidized Stafford Loans
  • Parent and Graduate/Professional PLUS Loans
Up to 10 years Payments begin lower and gradually increase, usually every two years. The borrower will pay more in interest under this plan than under the standard 10 year plan. Monthly payments would be lower under this plan than under the standard 10 year plan.
Extended Fixed or Graduated Repayment
  • Subsidized and Unsubsidized Stafford Loans
  • Parent and Graduate/Professional PLUS Loans
Up to 25 years Payments may be fixed for up to 25 years or may be graduated for up to 25 years. Direct loan borrowers must have more than $30,000 in outstanding Direct Loans. Monthly payments would be lower under this plan than under the standard 10 year or graduated plans. The borrower will pay more interest under this plan than under the standard or graduated 10 year repayment plan(s).

Income Driven Repayment Plans
Plan Eligible Loans Term Monthly Payment Other Info
Income Based Repayment (IBR)
  • Subsidized and Unsubsidized Stafford Loans
  • All PLUS Loans made to students
  • Consolidated loans that do not include Direct or FFEL PLUS loans made to parents
Up to 25 years Maximum monthly payments will be 15% of discretionary income which is the difference between the borrower's adjusted gross income and 150% of the poverty guideline for the borrower's family size and state of residence. Monthly payments change as the borrower's income changes. If the borrower has not repaid the loan in full after making 25 years of qualifying monthly payments, any outstanding balance may be forgiven. The borrower may have to pay income tax on any forgiven amount.
Pay As You Earn (PAYE)
  • Subsidized and Unsubsidized Stafford Loans
  • Direct PLUS Loans made to students
  • Direct consolidated loans that do not include Direct or FFEL PLUS loans made to parents
Up to 20 years Maximum monthly payments will be 10% of the borrower's discretionary income which is the difference between the borrower's adjusted gross income and 150% of the poverty guideline for the borrower's family size and state of residence. Monthly payments will change as the borrower's income changes In order to be eligible the borrower must be a new borrower on or after October 1, 2007 and have received a disbursement of a Direct Loan on or after October 1, 2011. If the borrower has not repaid the loan in full after making 20 years of qualifying payments, any outstanding balance will be forgiven. The borrower may have to pay income tax on any forgiven amount.
Revised Pay As You Earn (REPAYE)
  • Any Direct Loan that is in good standing
Up to 25 years Maximum monthly payments will be 10% of the borrower's discretionary income which is the difference between the borrower's adjusted gross income and 150% of the poverty guideline for the borrower's family size and state of residence. Monthly payments will change as the borrower's income changes Your monthly payment can be more than the 10-year Standard Plan amount. You may have to pay income tax on any amount that is forgiven. Good option for those seeking Public ServiceLoan Forgiveness (PSLF).
Income-Contingent Repayment
  • Subsidized and Unsubsidized Stafford Loans
  • Direct PLUS Loans made to students
  • Direct consolidated loans
Up to 25 years Monthly payments are recalculated each year and are based on the borrower's adjusted gross income, family size and total amount of outstanding Direct Loans. Monthly payments will change as the borrower's income changes. If the borrower has not repaid the loan after making the equivalent of 25 years of qualifying monthly payments, the unpaid portion will be forgiven. The borrower may have to pay income tax on the forgiven amount.
Income-Sensitive Repayment
  • Subsidized and Unsubsidized Stafford Loans
  • FFEL PLUS Loans
  • FFEL Consolidated Loans
Up to 10 years Monthly payments are based on annual income. Monthly payments will change as the borrower's income changes. Each servicer's formula for determining the monthly payment amount under this plan may vary.

More information regarding repayment plans can be found at https://studentaid.ed.gov/repay-loans/understand/plans

Loan Servicers

All federal loan borrowers will be assigned a loan servicer. The loan servicer is responsible for helping the borrower manage loan repayment.

Once you borrow a federal loan, you should determine who your servicer is and create an account with that servicer online or get in contact with the servicer in order to track your loans.

Through the loan servicer, a borrower can:

  • Update personal and contact information
  • View outstanding interest
  • Make payments
  • Arrange payment plans
  • Apply for deferments or forbearances
  • View interest information for tax purposes

A borrower should notify their lender if:

  • A name, address or phone number changes
  • The borrower graduates, drops below half-time enrollment, returns to school after graduation or transfers to another school
  • The borrower needs help making monthly loan payment(s)
  • The borrower has questions about their loan(s)

You can determine your loan servicer by logging into your account with the National Student Loan Data System (NSLDS). There are several federal loan servicers; the Department of Education offers an up-to-date list of all servicers and contact information.

Loan Deferment

A deferment is a period in which repayment of federal student loans is temporarily postponed.

During a deferment, the borrower will not be required to make monthly payments. During a period of deferment, the federal government will pay the interest on the borrower’s Subsidized Stafford and Perkins Loans. The interest that accrues on an Unsubsidized Stafford or PLUS Loan during a period of deferment will be the responsibility of the borrower.

The following are situations in which a borrower may qualify for a deferment:

  • Period of at least half-time enrollment in college
  • Period of study in an approved graduate fellowship program or in an approved rehabilitation training program for the disabled
  • Period of unemployment or inability to find full-time employment (only for up to 3 years)
  • Period of economic hardship (including Peace Corp service: only for up to 3 years)
  • Period of service qualifying for Perkins Loan discharge/cancellation (Perkins loans only)
  • Period of active duty military service during war, military operation or national emergency
  • Period of 13 months following the conclusion of qualifying active duty military service, or until you return to enrollment on at least a half-time basis, whichever is earliest if
    • You are a member of the National Guard or other reserve component of the U.S. armed forces and
    • You were called or ordered to active duty military while enrolled at least half-time at an eligible school or within six months of having been enrolled at least half-time
    • If you are returning to school and will be enrolled at least half-time in a degree program, you may qualify for a loan deferment. The Office of the Registrar can certify your enrollment at Iowa State University. Submit all In School At Least Half-Time Deferment forms to:

      Office of the Registrar
      2433 Union Drive
      214 Enrollment Services Bldg
      Ames, IA 50011
      Phone: (515) 294-1840
      certifications@iastate.edu

Loan Forbearance

A forbearance may be used when you cannot make your schedule monthly payments but you do not qualify for a deferment.

During a forbearance, you may reduce your monthly payment or not make any payments for a period of up to a year at a time not to exceed three years. During a forbearance, all loans would continue to accrue interest that the borrower would be responsible to repay when the forbearance ends.

Discretionary Forbearance

A discretionary forbearance is determined by the loan servicer. A borrower may request a discretionary forbearance for either a financial hardship or illness.

Mandatory Forbearance

A mandatory forbearance would be required by the loan servicer if the borrower met eligibility criteria listed below:

  • The borrower is serving in a medical or dental internship or residency program and meets other specific requirements
  • The total amount owed each month for all student loans is 20% or more of your total monthly gross income (additional conditions may apply)
  • The borrower is serving in a national service position for which you received a national service award
  • The borrower is performing teaching service that would qualify for teacher loan forgiveness
  • The borrower qualifies for partial repayment of student loans under the U.S. Department of Defense Student Loan Repayment Program
  • The borrower is a member of the National Guard and have been activated by a governor but is not eligible for a military deferment