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It might’ve been at least a few months or even years since you last signed your student loan agreement. And if you’ve graduated or left school, you might be asking, “When I do get my first student loan payment bill?”
Your first student loan payment is typically due after the loan’s grace period. Some student loans don’t offer a grace period and your first payment is expected as soon as funds are fully disbursed.
Learning how soon after graduation student loans are due — and how to pay them — can help you better prepare for loan repayment. Here are three questions you’ll need to ask yourself
When do I get my first student loan payment?
Figuring out when your student finance first payment is due can help you plan ahead when repaying your student debt. If you’re still in school, you can get a head start on repayment, but since your loans are likely in deferment, you won’t receive a first student loan payment notification from your servicer.
If you’re not in school, when your first student loan payment is due depends on your grace period. You can find the terms of your grace period on your Master Promissory Note (MPN) that you signed when accepting the loan.
Generally, you’ll have a six-month grace period before you’re required to submit your first student loan payment. However, the length of your grace period — and whether your loan comes with it — differs between lenders and loan types. For example, some federal loans (e.g. Perkins loans) and private student loans (e.g. from Earnest) offer a nine-month grace period.
The clock on your grace period starts when:
- You graduate,
- Are enrolled less than half-time, or
- Withdraw from school.
Since your school determines your date of separation, reach out to your loan servicer to find out when your grace period started and when it ends. Knowing the dates of your grace period helps you anticipate when your first student loan payment is due so you avoid the mistake of missing a payment.
When your grace period expires, your loan status is “in repayment”. If you have federal student loans, you’re automatically put on the Standard 10-year Repayment Plan. But you have the option to switch your payment plan.
That said, it’s important to double-check that your contact information is up to date with your lender or loan servicer. Your servicer needs your current information to notify you when your loan enters repayment, and send your student finance first payment statement.
Track down your federal student loan servicer
Whether you have federal or private loans (or both), your payment might not necessarily be going to the lender. A limited number of student loan servicers handle Federal Direct and PLUS loans (though this list could change in future), including:
- FedLoan Servicing (PHEAA)
- Granite State Management & Resources (GSMR) Student Loan Servicing
- Great Lakes Educational Loan Services, Inc
- OSLA Servicing
The servicer should contact you as soon as the loan was disbursed. Notification will also be sent if the Department of Education transfers your loan from one servicer to another.
Even private lenders, like CommonBond, outsource its billing to Firstmark Services. This means your first student loan payment wouldn’t go directly to CommonBond even if it’s your lender.
It’s important to remember that the loan servicer essentially works for you, so if you aren’t sure how to make payments using its billing system, ask them. A customer service rep should be able to tell you about setting up text or email alerts to avoid missing a payment.
How do I make my first student loan payment?
Welcome to student finance and your first payment. Once your grace period ends, it’s time to start repayment (and plan how you’ll pay future student loan payments).
You can make your first student loan payment in these three ways:
1. Set up auto pay with your servicer
Perhaps the best way to avoid delinquency is to set up an automatic payment with your servicer. So long as you feel comfortable about always having enough in your account to cover the payment, it will save you a lot of hassle.
Add your bank account and routing numbers to the servicer’s payment management page. You can find these numbers on your checks or by asking your bank over the phone or searching online.
Benefit of this method: By setting up automatic payments, you could qualify for a 0.25% interest rate deduction on federal Direct Loans or a similarly reduced rate on private loans. If you’re not sure this method is for you, educate yourself on the other pros and cons of automating your student loan payments.
2. Set up auto pay with your bank
If you handle other monthly bills through your bank, it might be convenient to pay your first student loan payment this way. Avoid overdraft fees by keeping your bank account balance high enough to cover the monthly charge.
To set up auto pay via your bank, make the servicer your payee and include the date and value of your automatic payments. Many banks allow you to set up recurring payments for as long as a year. It could take several days for an online transfer to be reflected in your account, so set the bank’s payment date earlier than the actual due date of your student loan’s first payment.
Benefit of this method: Although it’s not advisable or even possible to pay student loans with a credit card, some banks offer rewards for setting up auto pay from a checking account. With Citibank, for example, you might be able to earn monthly points when paying from an account enrolled in Citi ThankYou Rewards. Ask your bank about potential bonuses.
3. Pay your servicer manually every month
If automatic student loan payments aren’t preferable, do it the old-fashioned way. Most servicers allow borrowers to make payments manually online, through a mobile app (if it has one), over the telephone or via postal mail.
You can use your bank account as a payment method online or over the phone. Save your bank information on the servicer’s website to avoid reentering it each time a payment is due. If you’re paying over the phone, have your routing and account numbers ready.
Online and phone payments are more convenient and less risky compared to traditional mail, especially because of USPS slowdowns, recently. These methods ensure that your payment is received by the servicer immediately and can be applied to your account on time.
Payments can also be manually submitted every month using a check or money order. Some servicers also ask you to follow specific directions when stamping and sending a payment by mail. For example, you might be asked to include a tear-off insert from your bill, write your loan account number on the check or money order, or put the lender’s name on the payment even though you’re sending it to the loan servicer.
Know that the servicer could cash your payment the same day it receives it in the mailbox. It also won’t return the check (or a copy of it). You should, however, see the payment applied online.
Benefit of this method: Even though paying manually takes more time, it also gives you more control. If your bank balance sometimes drops below your monthly loan payment amount — or you don’t want to connect the servicer with your bank at all — this could be the safest choice.
Does my first student loan payment fit my situation?
Knowing when your first student loan payment is due and making on-time payments thereafter will help you chip away at your debt and stay in good standing with your lender. If at any point your payment amount isn’t a good fit for your finances, you can explore ways to lower the monthly amount that’s due. (See this post for more on how to prepare for your first student loan payment.)
For example, you might be eligible for an income-driven repayment plan that adjusts your payments so they’re less than 10% of your discretionary income. If you have good credit, you can also consider refinancing your student loans to lock in a lower interest rate and potentially lower monthly payment.
Another smart option is prepaying your debt, if you’re in a financially stable situation. This helps you lower your principal balance and avoid more interest overall so you get out of debt faster. To see if this can help, use our loan prepayment calculator to see how much money you can save.
Andrew Pentis contributed to this report.
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