When the borrower of a Student Loan graduates, leaves school, or drops
to a less than half-time status this date is called the Separation Date.

The separation date is used to determine the loan’s grace period and
the date the first loan payment will be due.

The Direct Loan Program offers a range of repayment plans:

Standard Repayment plan -
fixed payment for up to 10 years to repay.

Extended Repayment plan -
fixed payment for 12 to 30 years to repay, depending on loan balance.

Graduated Repayment plan -
smaller payments at first and larger payments later for up to 30 years to repay,
depending on loan balance.
 
Income Contingent Repayment (ICR) plan -
payment amount is based on your loan balance and your income
(and your spouse’s income if you are married) and can vary year to year
for up to 25 years.

The Income Contingent Repayment plan is NOT available to
PLUS loan borrowers.

Individualized payment plans can also be arranged with the Direct Loan
Servicing Center. Changing repayment plans is a good way to manage
your loan debt when your financial circumstances change.

For example, you can usually lower your monthly payment by changing
to another repayment plan with a longer term to repay the loan.
There are no penalties for changing repayment plans.

This entry was posted on Wednesday, February 14th, 2007 at 12:18 am and is filed under Student Loan Debt Consolidation, Financial Aid, Scholarships, Grants. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.