Understand the Basics of Student Debt Repayment


Flickr user Randen Pedersen

The reality most students face after they graduate, is how and when they are going to repay the student loans that they accrued of over the 4 years in college. Understanding the basics of repaying your student loans is important so you can plan accordingly. Here are a few things you absolutely must know about repaying your student loan debts.

Repayment Plans

If you do not choose a specific repayment plan, you will automatically be placed on a 10 year Standard Repayment program. This means you have to pay a fixed interest rate and 10 years to repay the amount. If you cannot afford the monthly payment on this plan you can consider moving to an income-driven repayment plan. With this plan you will pay more by way of interest but your monthly payments will be lower and the repayment time will be extended beyond 10 years.

Laurel road company logo.

Fixed cap on variable-rate loans

Variable rates from 1.64% - 5.65% APR with auto-debit

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Student Loan Forgiveness

It may be worth considering the forgiveness option.  Your student debt may be forgiven if your work involves some type of public services such as teaching or nursing or if you join the military or become a firefighter.


Consider enrolling in an auto debit plan. When you do this, your monthly payments are taken out of your bank automatically so you don’t have to worry about missing any payment. Even better, many banks will give you a .25% reduction in interest rate when you make your monthly payments through an auto debit plan.

Living with student debt can be stressful but you can stop it from becoming overwhelming by understanding the basics and exploring alternative schemes that help you reduce your debt.

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Lender Rates (APR) Eligibility
Earnest company logo.
Variable APR: 1.88% - 5.64%*
Fixed APR: 2.44% - 5.79%*
Undergraduate and Graduate
Lendkey company logo.
Variable APR: 1.90% - 5.25%*
Fixed APR: 2.49% - 7.75%*
Undergraduate, Graduate, Parent PLUS
Credible company logo.
Variable APR: 1.80% - 9.99%*
Fixed APR: 2.15% - 9.99%*
Undergraduate and Graduate
Laurel road company logo.
Variable APR: 1.64% - 5.65%*
Fixed APR: 2.25% - 5.75%*
Undergraduate and Graduate
Commonbond company logo.
Variable APR: 1.96% - 7.02%*
Fixed APR: 2.59% - 6.94%*
Undergraduate, Graduate, Parent PLUS
Fixed APR: 2.44% - 5.97%*
Undergraduate, Graduate, Parent PLUS
VISIT ISL Education Lending
Variable APR: 1.87% – 5.33%**
Fixed APR: 2.30% – 5.96%**
Undergraduate, Graduate, Parent PLUS
VISIT Nelnet
Variable APR: 2.94% - 4.84%*
Fixed APR: 2.99% - 4.94%*
Undergraduate and Graduate
VISIT College Ave
Variable APR: 1.86% - 6.01%*
Fixed APR: 2.47% - 5.99%*
Undergraduate and Graduate, Parent PLUS

*APR includes a 0.25% interest rate reduction for enrollment in automatic payments.

**Interest rate reduction of .25% for automatically withdrawn payments from any designated bank account (“auto debit discount”). Auto debit discount applies when full payments (including both principal and interest) are automatically drafted from a bank account. The auto debit discount will continue to apply during periods of approved forbearance or deferment if the auto debit discount was in effect at the time of receiving the forbearance or deferment. Auto debit discount will remain on the account unless (1) the automatic deduction of payments is canceled or (2) there are three consecutive automatic deductions returned for insufficient funds at any time during the term of the loan.

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