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Exit Counseling for Student Loans

At the beginning of students’ educational journey, they are required to complete entrance counseling. However, as their journey ends, students must now undergo exit counseling. 

What is Exit Counseling?

Exit Counseling is for those who borrowed federal loans during their schooling. These loan borrowers should have already completed entrance counseling upon receiving their loans.  

Who Must Complete it? 

Students who have borrowed federal student loans and are: 

  • Leaving school, 
  • Graduating, or 
  • Dropping below half-time enrollment. 

Highway sign that says "Graduation just ahaead"

Understanding Exit Counseling 

The main purpose of exit counseling is to help guide students in managing their loans. During exit counseling, borrowers receive crucial information about their rights and responsibilities as borrowers, including repayment options, loan consolidation, deferment, forbearance, consequences of default, and loan forgiveness programs. 

The goal of exit counseling is to prepare borrowers for life after college and to assess what they can repay based on their employment and the amount of loans they have. The counseling is tailored to the student’s loan amount and the information they provide about their post-college life. 

Why is this important for schools to require? 

Considering the rising college costs, the U.S. Department of Education advocates for the gainful employment rule, which holds certain postsecondary programs accountable for ensuring graduates receive a worthwhile return on their investment. Students must carefully choose a school where they can afford an education and confidently anticipate repaying their student loans. They should target jobs that cover basic necessities while also accommodating monthly loan payments. 

By mandating exit counseling, schools ensure compliance with federal regulations and assist students in fulfilling their obligations as borrowers. Schools should provide education on financial literacy to their students and encourage them to create budgets that incorporate their federal loans. 

Students should be aware that some institutions may withhold their transcripts or diplomas if they fail to complete exit counseling. 

Student trying to figure out he is going to pay for his student loans while completing exit counseling

Where to Complete Exit Counseling?

Students must have their FSA ID ready to sign into their account. Students can complete exit counseling at the Federal Student Aid website: https://studentaid.gov/exit-counseling/

What’s Next?  

Once a student has chosen a repayment plan, it’s time to start making payments! 

Still have questions? 

Contact our compliance team to talk to someone about exit counseling!  

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