It’s important, as a borrower, that you not only are aware of your obligations, but also of your rights. You are entitled to an approximate loan repayment schedule that should include the amount, number, and exact date of all your loan payments. If your loan repayment schedule includes a grace period, you have a right to that entire length of time before your repayment commences. You should also be informed of available alternate payment options, such as loan consolidation, as well as the conditions under which the loan(s) can be deferred or canceled.
Prior to receiving your first loan disbursement, the college or university you attend and the organization that is carrying your loan must provide you the following information in the entrance interview:
- The total amount of the loan you are borrowing and the current interest rate charges
- Information on extra charges (that is, any origination fees and insurance), such as when and how they will be collected from you and how much they are
- The maximum amount of money that can be borrowed each year through the program
- Time allotted for repayment
- Current statement of loans already owed
- Example of a monthly repayment schedule and an estimate of the total amount that will be owed
- How borrowing will affect your eligibility to receive other forms of aid
- The date you must begin repayment of your loan
- Loan consolidation and prepayment options
- An explanation of what it means to default on a loan
Following graduation or the completion of your studies, you must be given an exit interview by your college or university and/or the company that is carrying your loan. In this interview, you should receive the following information:
- The total amount of money you owe
- The current interest rate and all accumulated interest charges owed
- Amount of approximate monthly payments
- Any extra charges or fees that may ap- pear on your monthly statement
- All the information needed about the organization that is carrying your loan
- Advice on managing your payments
- Deferment, default, and cancellation guidelines
- Consolidation, repayment, and refinancing options
Defaulting on Student Loans >>>
