Understanding Your Loan Status

Once you accept your federal student loan, it is important to understand your loan status and what action steps you can take.

In School

While you are enrolled at least half-time (six credit hours for undergraduate students and four credit hours for most graduate students) you are not required to make any payments on your Federal Direct loans. You may make early payments on your loans as well as interest payments on your unsubsidized loans.

Action Steps

  • Determine your federal loan servicer is by using the National Student Loan Data System (NSLDS)
  • Open an account with your loan servicer and keep contact information current
  • Make interest payments if possible and/or begin making payments early
  • If you are unable to make monthly interest payments consider making one small payment to understand how the process works

Grace Period

Most Federal Direct loans have a six month grace period after you are no longer enrolled at least half-time in school. Repayment of your loans begins after the grace period expires.

  • You receive one grace period for each loan, once you use the grace period it is gone
  • This may mean you could go into repayment immediately on some loans and still have a grace period on other loans


Jessica decides to work for one semester and does not enroll in the spring after being continuously enrolled at least half-time each fall and spring.

  • Enrolled year one; fall and spring semesters
  • Enrolled year two; fall semester only
  • Not enrolled year two; spring semester
  • Enrolled again year three; fall and spring semesters

Since Jessica was not enrolled at least half-time for over six months during her year two spring semester, she has lost her grace period on any loans up to this point. Jessica enrolls full-time in her third year beginning in the fall and stays enrolled each fall and spring semester until graduation. Jessica will have a grace period for any loans received after returning to school, but will have lost grace on the loans taken before year three.

Action Steps

  • Contact your loan servicer to let them know you are out of school
  • Give your loan servicer your current contact information (address, phone number and email)
  • Review your loan borrowing history at the National Student Loan Data System
  • Research the different repayment plans (see below)


Repayment begins once your grace period has expired and continues until the loan is paid in full. You will make payments to your loan servicer; each loan servicer may have a different process so check with your servicer if you aren’t sure how or when to make a payment.

Action Steps

  • Select your repayment plan
  • Sign up for automatic debit (you may qualify for an interest rate reduction)
  • If you have difficulty with your payments, contact your loan servicer immediately to discuss your options and avoid delinquency or default
  • If you haven’t finished your degree, consider enrolling half-time (at least 6 credit hours) to qualify for an in-school deferment

Federal Student Aid has an overview of the different types of available Repayment Plans available. Work with your federal loan servicer to choose your payment plan. Keep in mind that longer repayment plans may result in you paying more than under the 10-year Standard Repayment Plan.

Deferment and Forebearance

If you are unable to make full payments on your loan you may qualify for a deferment or forbearance for your federal student loans if you meet certain criteria. Deferments and/or forbearance are tools that may be available to you in order to avoid delinquency and default.

  • Deferment temporarily postpones payments on a loan.
  • Forbearance temporarily suspends or reduces payments on a loan

Learn More About Deferment and Forebearance

Delinquency and Default

Missing payments or not making payments on your student loans will result in delinquency and possibly default. Avoid default and delinquency by contacting your loan servicer immediately. Default has severe consequences including:

  • Demand of immediate payment for the entire unpaid balance of your loans
  • Loss of eligibility for deferment, forbearance and repayment plans
  • Loss of eligibility for additional federal student aid
  • Your loan(s) account is sent to collections
  • Your loan(s) will be reported to the credit bureaus
  • Your federal and state tax refunds may be confiscated
  • Your employer may withhold money from your paycheck (wage garnishment)

Learn More About Delinquency and Default