Loan Repayment

Graduation/Entering Repayment:

Who is my lender? How much do I owe?:

For recent graduates of New England Law, you can contact the Office of Financial Aid for a copy of your Loan History Sheet from your attendance at the law school. However, the best and most comprehensive source for information about your federal loan borrowing history (both undergraduate and graduate) is the National Student Loan Data System (NSLDS). You will need to register a PIN (or use your FAFSA PIN) in order to access your data. All federal loans (Stafford, Perkins, Graduate PLUS) will be displayed, along with the loan amounts, the lender and guarantor for the loan, and the school which you were attending when you borrowed the loan. Private loan information is not included on NSLDS - you must contact either the lender from whom you borrowed the loan, the school you were attending or you can pull your credit report.

Exit Interviews:

Once you have graduated or withdrawn from New England Law, you will be asked to complete an exit interview. We strongly urge you to complete an exit, as it provides you with important repayment information about your loans and will update your contact information with the Office of Financial Aid. The exit is kept on file at our office, in the event that your lender is unable to contact you. Exits should be completed for your Federal Stafford, Graduate PLUS and Perkins Loans and can be done online at http://mappingyourfuture.org. Additional exit materials are required to complete for your Perkins Loan and will be mailed to you prior to graduation.

Updating Your Information:

It is extremely important to update your lenders and the law school whenever you have changed your contact information. The burden is on the borrower to notify the lender of an address change. While the exit interview is a big part of this, for students who may move multiple times in the years following school, it will be necessary to continue updating everyone to make sure you don’t fall behind on payments. Failing to make on-time payments due will do damage to your credit rating, which could impact your ability to borrow in the future.

Entering Repayment:

Your loans will enter repayment at different times post-graduation (or less than half-time enrollment):

Federal Stafford Loans (subsidized & unsubsidized)	6 month grace period
Federal Graduate PLUS Loans	First payment due 60 days after final disbursement of loan; borrowers who are still enrolled at least half-time will be placed on in-school deferment until date of graduation*
Private Alternative Education Loans	Varies by lender
Federal Perkins Loans	9 month grace period

*For Grad PLUS loans borrowed prior to July 1, 2008, students can request a forbearance prior to graduation to align their Grad PLUS payments with their Stafford Loans (6 months). You must contact your lender directly to initiate this request. Grad PLUS loans borrowed on or after July 1, 2008 will automatically go into a 6 month deferment.

FFEL Loans vs. Direct Loans:

Schools decide how their students will borrow federal funding – either through the Direct Loan Program or the Family Federal Education Loan (FFEL) Program. New England Law is a FFELP school, meaning that your federal loans are borrowed through a FFELP lender. All federal loans, regardless of whether they were borrowed from a FFELP or Direct Loan school, can be consolidated in the Direct Loan Program (this may be required for participation in programs such as Public Service Loan Forgiveness).

Deferments:

A deferment is a period in which repayment of principal and interest is postponed temporarily. During the deferment of a subsidized Stafford loan, the government pays the interest that accrues. For unsubsidized loans (Stafford, Grad PLUS), you are responsible for the interest that accrues during the deferment period. If you have unsubsidized loans, any unpaid interest capitalizes when you enter repayment at the end of the deferment. If you are not eligible for a deferment you may still be eligible for a forbearance.

Common deferments include:

In-school at least half time
Graduate fellowship program
Rehabilitation training program
Military service
Unemployment
Economic hardship

Forbearances:

A forbearance is an arrangement to postpone or reduce your monthly payment amount for a limited and specific period during which you are charged interest. If you indicate a temporary inability, but willingness to pay the loan(s), you may ask for or be offered a forbearance. For all loans, interest that accrues during a forbearance is the responsibility of the borrower. When you re-enter repayment at the end of the forbearance period, any unpaid interest capitalizes. You must apply and qualify for a forbearance and your lender must approve the request in order for a forbearance to be in effect. If you are not eligible for a forbearance you may still be eligible for a deferment.

Your lender may grant forbearance if you:

are experiencing personal problems (for example, poor health or economic hardship);
are affected by circumstances such as a local or national emergency, military mobilization, or natural disaster;
have exhausted your eligibility for an internship deferment
are serving in a position that may qualify you for loan forgiveness, partial repayment of your loan, or a national service educational award.

Lenders may be required to grant forbearance for the following reasons:

You are in a dental or medical internship/residency program.
Combined monthly payment on your federal student loans equals or exceeds 20 percent of your gross monthly income
You are performing service for which you qualify for the following:
- A national service educational award from AmeriCorps
- The Federal Teacher Loan Forgiveness Program
- The Student Loan Repayment Programs administered by the U.S. Department of Defense
- The federal government authorizes postponement of repayment because you are subject to a military mobilization, affected by a local or national emergency or live in a federally-designated disaster area.

Interest Rates:

The interest rates your loans are carrying will be based on the type of loan you borrowed and when you borrowed the loan. Your interest rates may change if you are taking advantage of borrower benefits or if you consolidate your loans. Your lender will be the best source of information on what your interest rates are, however, the following is a basic chart for loans borrowed while at New England Law:

Federal Stafford Loans (subsidized & unsubsidized) *borrowed before July 1, 2006*	Variable rates (unless you consolidated these loans to a fixed rate)
Federal Stafford Loans (subsidized & unsubsidized) *borrowed on or after July 1, 2006*	Fixed rate: 6.8%
Federal Graduate PLUS Loans	Fixed rate: 8.5%
Private Alternative Education Loans	Credit-based/varies by lender
Federal Perkins Loans	Fixed rate: 5%

For more information:

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Repayment Plans:

There are several types of loan repayment plans available for borrowers. Should you enter repayment and not change your plan, the default plan is Standard Repayment. You are allowed to switch payment plans once per year. There are no early repayment penalties for federal loans.

Standard Repayment Plan:

10 year repayment period
Fixed monthly payments (minimum $50/month)
Will have the highest monthly payment due, but accrues the lowest amount of interest
Best if:
- You have a steady source of income
- You want to eliminate your debt as soon as possible, while paying the least amount of interest, with the lowest total cost

Graduated Repayment Plan:

10 year repayment period
Monthly payments will be lower to start; interest only payments the first 2-3 years
Payments will increase after 2-3 years (but no single payment will be more than three times greater than any other payment you've made)
Will cost more than a standard plan, due to interest accrual
Best if:
- You want to make lower monthly payments to start
- You expect your income to increase steadily over time

Extended Repayment Plan:

Must have $30,000 of FFELP loan debt (cannot include Federal Direct or Perkins loans, unless you've consolidated these loans into Direct Lending)
Up to 25 year repayment period
Within this plan, you can choose standard or graduated repayment terms
Useful for lowering payments without resorting to a deferment or forbearance
High amount of interest will accrue
Best if:
- You have a high amount of debt
- You need to make lower monthly payments

Income Sensitive Repayment Plan:

15 year repayment period
For FFEL Loans - this plan in the Direct Loan Program is called Income Contingent
Monthly payments are based upon a fixed percentage of your gross monthly income, between 4% and 25%. The percentage is determined by the borrower and the resulting payment must be greater than or equal to the interest that accrues. Some lenders may set a minimum threshold on the percentage of income, based on your debt-to-income ratio.
Accrues a larger amount of interest than a standard plan
Income information must be reported yearly to remain eligible
Best if:
- You need to make lower monthly payments based on your income

Income Based Repayment Plan:

Up to 25 year repayment period - any outstanding eligible balance remaining at the end can be forgiven. At time of publication, this outstanding amount will be taxable.
You must demonstrate a "partial financial hardship" to be eligible to enroll in this plan
Monthly payments are capped at 15% of your monthly discretionary income, where discretionary income is the difference between your prior year's adjusted gross income (AGI, plus your spouse's if you're married and filing taxes jointly) and 150% of the federal poverty line that corresponds to your household size and state in which you reside (subject to change)
May not result in the lowest monthly payment possible - other plans may be more beneficial
Income information must be reported yearly to remain eligible
High amount of interest will accrue
Parent PLUS loans cannot be included (nor can a Federal Consolidation Loan that included a Parent PLUS)
Best if:
- You need to make lower monthly payments based on your income
- You're pursuing a public service career and/or you're making payments for the Public Service Loan Forgiveness Program
- Your annual AGI is significantly less than your outstanding loan debt

For more information on these various plans:

Finaid.org Loan Repayment
Accessgroup.org Loan Repayment
Direct Loans Calculator for different repayment plans
Consult your lender

College Cost Reduction and Access Act of 2007 / Public Service Loan Forgiveness:

CCRAA was created to help public service attorneys in two ways:

Through Income Based Repayment (IBR) which lowers monthly student loan payments on federal student loans. Under IBR, annual loan payments may be no more than 15% of discretionary income.
Through Public Service Loan Forgiveness (PSLF) which forgives remaining debt for public servants after 10 years of public service employment. Under the Loan Forgiveness for Public Service, if a borrower makes 120 qualifying loan payments on a Federal Direct Loan (including Federal Direct Consolidation loans) while working full-time for 10 years in public service, the unpaid balance is forgiven by the federal government. (Borrowers may consolidate into Direct Lending in order to qualify for this loan forgiveness program starting July 1, 2008.)

Public service employment is defined as:
- employment in a 501(c)(3) organization
- employment in government (local, state, federal, and tribal; including military and employment in public schools and universities)
- service in a full-time AmeriCorps position
- employment in a "public service organization" (including legal services)

Public Service Loan Forgiveness is NOT a payment plan option - it must be bundled with either Standard, Income Contingent or Income Based Repayment Plans. Since it is only available for loans in the Direct Loan Program, students at New England Law who have borrowed FFEL Program loans can consolidate the loans they want to be included in Public Service Loan Forgiveness as a Direct Consolidation Loan with the U.S. Government in order to make them qualify.

Students who make payments through the IBR plan for Public Service Loan Forgiveness should keep in mind that if they do not complete the required 10 years of public service, you will have accrued a large amount of debt with this plan. Only students who are serious about completing the full 10 years should consider IBR for their PSLF repayment plan.

For more information on these new programs:

How Do I Get Them? from IBR Info - how to apply for IBR and/or qualify for PSLF.
Loan Forgiveness for Public Service Employees from U.S. Dept of Education (PDF)
Public Service Loan Forgiveness Q & A from U.S. Dept of Education (PDF)
IBR Q & A from U.S. Dept of Education (PDF)
Equal Justice Works CCRAA
Equal Justice Works Loan Forgiveness for Public Service Employment Checklist (PDF)
Prof. Philip G. Schrag - "Federal Student Loan Repayment Assistance for Public Interest Lawyers and Other Employees of Governments and Nonprofit Organizations" (PDF)
U.S. Department of Education – 34 CFR Parts 674, 682 and 685; Final Rule, October 23, 2008 (PDF)
Finaid.org Public Service Loan Forgiveness
Finaid.org IBR Calculator
Project on Student Debt

Consolidation:

Loan consolidation can result in lower monthly payments, fixed interest rates, only one payment for your federal loans per month, and new or renewed deferments. While you may pay more in total interest over the life of the loan, your monthly payments may be significantly lower.

There are a number of factors to consider before deciding to consolidate. In some cases, you may find that consolidation will be necessary – for example, it is required to consolidate with the Federal Government if you want to enter the Public Service Loan Forgiveness Program. On the other hand, if you have all of your federal loans at a fixed rate, you may benefit from not consolidating. Private education loans cannot be consolidated with federal loans. The following links provide more information about consolidation and how to determine if it’s the best choice for your repayment:

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Important Dates:

Upcoming Loan Repayment Sessions (for students graduating May ’10):

Date	Time	Location
Mon, March 29^th	4:30 – 5:30	Rm 304
Tues, March 30^th	4:30 – 5:30	Rm 305
Tues, April 13^th	4:30 – 5:30	Rm 305
Wed, April 14^th	2:30 – 4:00	Rm 304

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Additional Information:

American Student Assistance (ASA):

800-999-9080

Many students will be receiving correspondence from ASA, the guarantor for the majority of students at New England Law. They, as well as your lender, will be able to provide you with information about repayment and can assist you with any questions or concerns you may have.

Perkins Loans & Affiliated Computer Services (ACS):

800-826-4470

Students who borrowed a Perkins Loan while at New England Law will be receiving correspondence from ACS. ACS is New England Law’s servicer for these loans. If you have any questions about your repayment you may contact them or the Office of Financial Aid.

Loans Purchased by the Department of Education (PUT Program):

The U.S. Department of Education has recently begun purchasing FFEL Program loans from FFEL loan holders. It is possible that some of your federal loans may become owned and serviced by the Dept. of Education. Both your former lender and the Dept. of Education would contact you in such an event. You can also check your NSLDS records to determine which of your loans have been sold to the Dept. of Education as well as who the new servicer is. U.S. Dept. of Education will show up as the G.A. - Guarantee Agency - and the servicer will be provided as a code number:

Servicer Code	Servicer Name
700577	Dept of Ed / ACS
700578	Dept of Ed / Sallie Mae
700579	Dept of Ed / PHEAA
700580	Dept of Ed / Nelnet
700581	Dept of Ed / Great Lakes

For more information about this program and contact information for customer service:

Federal Student Aid webpage

Borrower FAQ Handout from American Student Assistance

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Loan Repayment

- Graduation/Entering Repayment

- Repayment Plans

- Important Dates

- Additional Information

Graduation/Entering Repayment:

Repayment Plans:

Important Dates:

Additional Information: