Student Loan Repayment

Congratulations on becoming an alum of Columbia University!

However, for many students, graduation doesn't mean you are done paying for school. Many students graduate with student loans and must enter monthly repayment, sometimes for many years after graduation depending on the terms of the loans.

It is fundamentally important for graduating students to know their loan details and to know their options for handling repayment. Review the accordions below to learn more.


 

Loan Repayment Steps

Students with federal loans are assigned a loan servicer after their loan amount is first disbursed and paid to the school. Your loan servicer will contact you to set up an online account from which you can access your loan information and repayment options.

If for some reason you do not have information from a loan servicer and want to know the servicer to which you have been assigned, your StudentAid.gov account will make your servicer available from the dashboard, or you can call the Federal Student Aid Information Center (FSAIC) at 1-800-433-3243. 


Learn more about student loan servicers from StudentAid.gov.


Students with Perkins Loans and Columbia Institutional Loans must use University Accounting Service (UAS) as their loan servicer.


You must contact UAS for more information about payment plan options as well as to update your name and contact information or to ask questions about your bills. If you have trouble using the UAS portal, email UAS at [email protected] or call (844) 870-8701.

Current Federal Repayment Plans

Your federal loan servicer can help you choose a payment plan to fit your financial situation. The following is a list of current payment plan options for federal student loans. Click each of the payment plans below to learn the details.


Learn more about federal payment plans from StudentAid.gov.


Repaying Perkins Loans and Columbia Institutional Loans

  • Federal Perkins Loans
    • The Federal Perkins Loan Program ended in September 2017, which means such loans are no longer issued to students. However, many students who were issued Perkins Loans prior to 2017 are still in repayment. Perkins Loans include a repayment period of 10 years.
  • Columbia University Institutional Loans
    • Institutional loan repayment begins six months after graduation or after enrollment status drops below half-time

You must contact UAS for more information about payment plan options. If you have trouble using the UAS portal, email UAS at [email protected] or call (844) 870-8701.

If You Forget to Pay Your Bill

If you don't pay your student loan bill in full by the due date, your account will be marked past due, or delinquent. The delinquency is removed when you pay the full amount owed. If you are delinquent for 90 days, your failure to pay will be reported to the three national credit bureaus (also known as consumer reporting agencies). Your credit score can be damaged by this reporting.

What to Do If You Cannot Afford Your Payment

If you cannot afford your payment, do not allow your account to fall into delinquency and eventual default. Contact your loan servicer as soon as you know you cannot pay the amount due and discuss your options. You may be able to defer your payments, enter forbearance, or change your payment plan so that your monthly bill is lower.


Delinquency is a warning. Learn more about delinquency from StudentAid.gov.

Too Many Missed Payments

Continuing to miss payments beyond 90 days can lead to something called defaulting on a loan, which has severe penalties if it is not addressed immediately.

  • You become ineligible for deferment or forbearance as well as the ability to choose a different repayment plan.

  • You become ineligible for additional federal student aid.

  • Your credit score is further damaged by the default reporting. Credit scores that are too low can affect your ability to acquire apartments, credit cards, car loans, home loans, and even some jobs.

  • Your loan holder may immediately accelerate the due date of your entire unpaid balance.

How to Get Out of Default

A borrower may repay the defaulted loan in full or make satisfactory repayment arrangements. For example, 12 consecutive, voluntary, on-time, and full monthly payments that are reasonable and affordable given the borrower’s financial situation.

After the student has made 12 such payments, the loan may be marked as rehabilitated—in other words, no longer in default anymore. The student will regain all the normal loan benefits, such as deferments, as well as access to additional federal financial aid. 


Defaulting is a consequence. Learn more about defaulting from StudentAid.gov.

Federal borrowers may qualify for a deferment, which is a form of temporarily pausing repayment, if the following situations apply to them:

  • Cancer treatment
  • Economic hardship
  • Graduate fellowship enrollment
  • Half-time enrollment in college or career school (which may be automatically applied)
  • Military service
  • Rehabilitation treatment program
  • Unemployment

Additional eligibility rules may also apply.

Drawbacks to Deferring

There are some disadvantages to deferment when it comes to specific loan types. Some loans include a pause to the interest accrual, but others do not.

The following loans accrue unpaid interest during deferment:

  • Direct Unsubsidized
  • Unsubsidized Federal Stafford Loans
  • Direct PLUS Loans
  • Unsubsidized portions of Direct Consolidation Loans
  • Subsidized portions of Direct Consolidation Loans
  • Unsubsidized portions of FFEL Consolidation Loans

Loans that accrue unpaid interest will capitalize that unpaid interest. This means if you do not pay the interest during deferment, then it will be added to the loan balance total. This is a snowball effect. The loan's interest rate is applied toward the balance, ultimately increasing how much you are expected to pay overall. Paying your interest during deferment keeps your overall balance lower.

Additionally, deferment does not typically help borrowers earn progress toward loan forgiveness. Loan forgiveness programs expect consecutive payments. Any breaks in payments may cause your progress to start over.   

For the above reasons, the Federal Student Aid website encourages borrowers to choose the Income-Based Repayment Plan in lieu of deferment when borrowers feel like they can't afford their payments for a period of time. It's better to make a much smaller payment consecutively than to allow large interest charges to capitalize during a pause.


Learn more about deferment from StudentAid.gov.

Federal borrowers may qualify for a forbearance, which is another form of temporarily pausing repayment, if the following situations apply to them:

General Forbearance

  • Financial difficulty
  • Medical expenses
  • Change in employment
  • Additional reasons accepted by a servicer to qualify

General forbearance lasts up to 12 months and must then be renewed. Cumulatively, general forbearances are limited to a total of three years (three 12-month forbearances).

Mandatory Forbearance

  • AmeriCorps
  • Department of Defense Student Loan Repayment Program
  • Medical or dental internships and residencies
  • National Guard duty
  • Severe student loan debt burden
  • Teaching service that qualifies for teacher loan forgiveness

Mandatory forbearance also lasts up to 12 months but does not have a cumulative limit. (This can be attractive to borrowers in medical/dental residencies.) If you continue to meet the eligibility for a mandatory forbearance, you may request a new 12-month forbearance from your servicer.

Drawbacks to Forbearance

There are some disadvantages to forbearance when it comes to specific loan types.

Some loans include a pause to the interest accrual, but others do not. The following loans accrue unpaid interest during forbearance:

  • Direct Loans (unsubsidized and subsidized)
  • FFELP loans (includes Grad PLUS loans)

Loans that accrue unpaid interest will capitalize that unpaid interest.This means if you do not pay the interest during forbearance, then it will be added to the loan balance total. This is a snowball effect. The loan's interest rate is applied toward the balance, ultimately increasing how much you are expected to pay overall. Paying your interest during forbearance keeps your overall balance lower.

Additionally, forbearance does not typically help borrowers earn progress toward loan forgiveness. Loan forgiveness programs expect consecutive payments. Any breaks in payments may cause your progress to start over.

For the above reasons, the Federal Student Aid website encourages borrowers to choose the Income-Based Repayment Plan in lieu of forbearance when borrowers feel like they can't afford their payments for a period of time. It's better to make a much smaller payment consecutively than to allow large interest charges to capitalize during a pause.


Learn more about forbearance relief from StudentAid.gov.

Some professions can lead to loan forgiveness, which is a type of debt erasure based on employment. Common fields that offer loan forgiveness include teaching, health professions, and other public services for non-profits and government entities.

Federal Forgiveness Programs

Review the following loan forgiveness programs to see if they apply to you:

  • Teacher Loan Forgiveness 
    • Teachers may be eligible for forgiveness of up to $17,500 on Direct Subsidized and Unsubsidized Loans and Subsidized and Unsubsidized Federal Stafford Loans if they teach full-time for five complete and consecutive academic years in a low-income school or educational service agency and meet other qualifications.
  • Public Service Loan Forgiveness (PSLF)
    • The PSLF Program forgives the remaining balance on your Direct Loans after you have made 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a qualifying employer.
      • Military service is considered a qualifying employer. 
  • Perkins Loan Cancellation
    • Federal Perkins Loan cancellation is based on eligible employment or eligible volunteer service and the length of time that you were in such a position. Discharge of your Perkins Loan may occur under certain circumstances.

Discharges and Cancellation

Review the following special circumstances under which loan discharges and cancellation may be applied:


Learn more about loan forgiveness, discharges, and cancellation options from StudentAid.gov.

Refinancing and loan consolidation are similar but different approaches to reducing your overall loan costs by reducing your interest rate. 

Refinancing

After students graduate and enter repayment, they may receive mailed notices from private companies offering them opportunities to refinance their student loans. Refinancing involves taking out a new loan with new terms that pays off your current loan. The primary reason people choose to refinance their student loans is to obtain a lower interest rate.

Refinancing only makes sense to a borrower if they have been offered a lowered interest rate and are in a financially secure position to commit to the terms of a new loan. For example, say you owe $30,000 on your current federal loan and the interest rate is 6%. You could refinance through a new lender and get a new interest rate of 4%. This would ultimately save you money over time.

However, there are disadvantages to consider. To refinance through a private lender means losing access to safety nets and repayment help provided by the U.S. government. For example, if you lose a job while in repayment, you could seek an Unemployment Deferment and then resume paying once you have a job again. If you have a private lender, they do not offer any kind of pauses or changes to your repayment plan. You are expected to make your payment every month without fail. Alternatively, suppose the government were to cancel federal student loan amounts or pause the interest rates such as they did during the COVID-19 crisis—private borrowers would not receive this benefit. 

Students with federal government loans should weigh all options before leaving a federal repayment program.

Loan Consolidation

Many students often graduate with multiple loans and a variety of interest rates that reflect the number of semesters or academic years when financial aid was needed. When you have multiple different loans with different interest rates, it may be possible to consolidate those loans into one single loan with one interest rate. When done through the U.S. Department of Education, there is no cost.

The primary reason people choose loan consolidation is to reduce the overall amount of interest they are expected to pay for their loans. Consolidation results in one fixed interest rate. Depending on the loan balances and their respective interest rates, a lower overall fixed rate for one loan total may result in a savings.

You can use the Loan Payments Calculator available from iGrad to calculate the costs of your loans and compare them to a potential fixed-rate consolidated loan to see if there is a savings. Borrowers can also visit the Federal Student Aid website and use the Loan Simulator tool to find the best loan repayment strategy for them.


Learn more about loan consolidation from StudentAid.gov.

Financial Advising Disclaimer

Student Financial Services staff are not licensed financial advisors nor financial planners and cannot offer individualized professional guidance nor consultations on how best to direct students' money toward financial goals. Columbia University does provide online resources to students for self-study. Students should take advantage of iGrad training to learn as much as possible about financial literacy and set themselves up for success before and after graduation.


We encourage students who require personalized financial assistance to seek out private or non-profit resources to help manage their debt, investments, housing, banking, and tax-related needs. Columbia University is not responsible for the individual financial choices of students and families.