Student Loan Repayment

Learn about repaying student loans and choosing the best plan for your needs

Whether you're looking ahead, or are now ready to begin repaying your student loans, it pays to learn about the requirements and what will be expected of you, as a borrower. Remember that by being mindful of your student loan repayment obligations and paying on-time, you're beginning to lay the foundations for your lifelong credit history. This will either make your financial life easier or harder, depending on your actions.

Generally around the time you graduate, you should receive information about repayment from your student loan provider. They will notify you of the date your college loan repayment begins. At this time, you can also decide which payment options you'd prefer, at least for federal loans. Keep in mind that private loans from banks typically have fewer options, which are usually chosen at the time you apply, so contact your lender for more information.

Types of student loan repayment plans

Repayment options typically differ by lender and there are usually one or more of the following repayment options available:

• Interest-only—Interest payments are required while the student is enrolled in school. Payments on principal are deferred while the student is enrolled in school.
• Immediate—Both principal and interest payments are required while the student is enrolled in school.
• Standard plan—you pay a fixed amount each month until the loan is retired, or paid off in full.
• Extended—allows you to pay less each month over a longer period, up to 25 years. Just remember that means you'll be paying more interest.
• Graduated—you begin paying a low amount each month, which is increased every two years. Ideal for those who expect their income to steadily rise.
• Income-based repayment (IBR)—a new repayment plan that permits you to cap monthly payments at a rate that's affordable. Check with your lender to see if you qualify.
• Income-contingent—available to borrowers with direct loans.
• Income-sensitive—available to borrowers with Federal Family Education Loans.

If you choose none of those college loan repayment options, you'll simply be assigned the standard plan. If your lender has an automatic debit option—which allows for loan repayment automatically from your personal checking account—you may want to look into it. It's a handy tool to make sure your loan is paid each month, on time and some lenders offer an interest rate reduction when you sign up for automatic payments.

If you have federally guaranteed loans, you can access your loan information online, through the Department of Education's National Student Loan Data System. There, you can check your student loan status and any outstanding balances.

Private Loan Repayment

For private loans typically repayment is chosen at the time you apply for the loan. There are usually one or more of the following repayment options available:

• Immediate—Both principal and interest payments are required while the student is enrolled in school.
• Interest-only—Interest payments are required while the student is enrolled in school. Payments on principal are deferred while the student is enrolled in school.
• Deferred—Payments are not required while the student is enrolled in school at least half-time. Interest does accrue and will be added to your loan.

Learn more about flexible student loan repayment options

Find helpful information about our affordable Citizens Bank TruFit Student Loan®. TruFit offers three repayment options and a 0.50% interest rate reduction on your TruFit Student Loan when you sign up for automatic payments from any eligible Citizens Bank account. For more information on our TruFit Student Loan call a student loan specialist at 1-800-708-6684.