GET READY! Student Loan Interest Accrual and Payments Start

After three years, including a pandemic, student loan interest will begin to accrue, and payments will be due. It’s time for schools to remind and guide students toward making their first payments. On September 1st, federal student loans that are no longer in deferment or forbearance began accruing interest. The student loan payment pause is ending, and payments will be due October 1st. This means that for recent graduates or students who have completed their education, the grace period is ending, and they will be responsible for repaying their loans and interest. 

What Should Schools Educate their Students on: 

To learn all about loans and repayment options, visit Federal Student Aid

  1. Knowing their Loans: Understanding what type of loan they have, whether it is federal or private, and what its interest rate is.  
  2. Budgeting: Students should incorporate their student loan payments into their budgets as it will help keep their finances organized and help them understand where their money is going.  
  3. Researching Repayment Options: Encourage students to look for repayment plans that would best suit their financial situation, such as an Income Driven Repayment (IDR) plan. After choosing a plan, a great option is enrolling in autopay as many lenders provide a 0.25% deduction from loan’s interest rate, which means paying less interest. 
  4. Considering Extra Payments: If possible, make extra payments towards loans to reduce the overall interest that will be paid and pay off the debt faster. 
  5. Loan Servicer: Help guide students to find out who their loan servicer is by signing into Federal Student Aid. Students can also call the Federal Student Aid Information Center (FSAIC) at 800-433-3243. 
  6. Paying on Time: Missed payments can have serious consequences. After 270 days of not making payments, loans go into Default, which damages the students credit score and can potentially lead to legal action and fees. If a student is unable to make payments, they should reach out to their loan servicer for assistance.  

Schools Financial Aid departments should host information sessions to assist students in finding the best customized payment plan. Emphasizing the importance of on-time loan repayment is crucial, as missed payments can have consequences, impacting both students and the school. Colleges with Cohort Default Rates (CDR) above 30%, for three years in a row, could lose federal aid and face a drop in reputation from the public.   

Schools should strive to help their students explore job and career opportunities. Along with this, teaching students about financial literacy and incorporating it into the school’s program can help teach money management and skills students will actually use and benefit in the future. 

Student clenching a pencil with her teeth while looking stressed at her laptop

As time flies by, make sure your students always have a plan spanning months or even years ahead, including preparations for unexpected financial emergencies. Although students should try to reduce extra spending, this does not mean they should cut out things that make them happy! Keep doing those fun activities, but also look for budget friendly alternatives.  


This significant change can be stressful for many students, leading them to have questions for their school’s financial aid department (which is completely okay). FAS is here to help schools understand this change and guide them on how to best support their students. Do not hesitate to Call or Email FAS with any inquiring questions! 

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  1. Tara Foster

    October 9, 2023 at 11:59 pm

    I’m new to the financial aid office, and would like more information and how i can help to educate our students even more so


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