Preparing to Enter Repayment on Your Loans

As you prepare for the transition from Rutgers into your career, you will be working with your loan servicer(s) in repayment. Be sure that your address and contact information is up to date and pay special attention to any correspondence from loan servicers.

What Happens When You Graduate

Grace Periods

When you graduate, your loan servicer(s) is notified that you are no longer in school and you automatically enter any grace or similar period(s) you have on your student loans.

Different loans may have different grace periods, so loans may enter repayment at different times

  • Stafford Loans have a 6 month grace period
  • Perkins Loans have a 9 month grace period

Some loans do not have grace periods and may come due immediately upon graduation. Inquire with your loan servicer for details.

Grace periods are “loan specific,” so if you used up a grace period on any loans you had before starting school, those grace periods are gone and those loans will come due when you graduate, six months earlier than some others.

Entering Repayment

Approximately 30-45 days prior to the expiration of your grace period, watch for a notice from your loan servicer that your loan is about to enter repayment. Be sure your loan servicer(s) has your current address and that you know what graduation date is reported for you at Rutgers.

Notice from loan servicer(s) should reference several options, such as choosing a repayment plan and actively repaying your student loans, or choosing to postpone your payments through deferment or forbearance.


Rutgers University has partnered with Inceptia to help simplify the loan repayment process. Borrowers can expect to hear from Inceptia regarding their situation throughout their enrollment time and also upon separation from enrollment at Rutgers.

Inceptia, a division of the National Student Loan Program (NSLP), is a nonprofit organization providing leadership and innovation in higher education access, verification, student loan repayment, default prevention, financial education, and more. Inceptia is working with schools to create a world where students are less burdened by the anxiety of student loan debt. Where financial aid offices are freed from time-consuming processes and tasks that pull them away from helping students. And where default rates continue to fall even as loan amounts increase.

At Inceptia, it is their mission to support schools as they arm students with the knowledge needed to become financially responsible citizens – without accumulating the burden of debt and default. Inceptia provides the confidence and proven solutions you and your school can count on – helping ensure a brighter financial future for your students.

Loan Repayment Options

The repayment options listed below are for Stafford, Grad PLUS, and Federal Consolidation Loans. While there are some restrictions, you may switch repayment plans if needed; contact your loan servicer(s) if you have questions about changing repayment plans.

  • 10 years for unconsolidated loans, same payment each month.
  • Your loan servicer will automatically place you in standard 10-year repayment plan should you not choose a repayment plan when given the opportunity.
  • Monthly payments higher than other plans, but total repayment costs are lower.
  • Standard repayment term for federal loan consolidation is up to 30 years (look carefully at correspondence from loan servicer).
  • May be appropriate for borrowers with steady income who can afford the higher monthly payment.
  • Payments start lower and increase by designated amounts at designated intervals.
  • 10-year repayment term.
  • Initial lower payments result in higher overall repayment costs when compared with standard, unless payments later accelerated.
  • May be appropriate for borrowers with steady income but who have some other financial commitments that can be met in a relatively short period of time.
Income-Driven (Income-Related) Plans
  • Monthly payments are tied, at least in part, to income.
  • Plans include Income Sensitive Repayment, Income Contingent Repayment, Income Based Repayment (IBR), Pay As You Earn (PAYE) and Revised Pay As You Earn (REPAYE).
    • Pay As You Earn and the new Revised Pay as you Earn plan usually offer the lowest monthly payment of the various income-driven plans and are available for eligible borrowers on direct loans only.
    • IBR is available for eligible borrowers on both FEEL and direct loans (FFEL are federal loans from private lenders and direct loans are federal loans taken out directly from the government)
  • Borrower must renew eligibility each year.
  • May be appropriate for borrowers with relatively low income who cannot afford payments under other available plans.
  • IMPORTANT NOTE: You may need to submit current income information. You may want to consider filing a tax return for the 2015 year as your loan servicer may use your prior year return when helping determine eligibility and subsequent payment amount under these programs
  • Initial to lower payments result in higher overall repayment costs when compared to Standard 10-year plan.

Direct Loan Consolidation (Optional)

Consolidation is a process whereby you pay off or refinance multiple loans with one new loan. There are both advantages and disadvantages to consolidation, and while it is an effective debt management tool for some graduates, it is not appropriate for everyone.

Quick facts about consolidation:

  • The interest rate on consolidation loans is a weighted average of all loans being consolidated, rounded up an eighth of a percent (.125%) then fixed for life of loan.
  • Consolidation pays off your outstanding loans with your current lenders.
  • The Federal Direct Consolidation Loan online application available at
  • More direct loan consolidation information is available on If you have questions about consolidating your federal education loans before you apply, you can also contact the Loan Consolidation Information Call Center at 1-800-557-7392.

Postponing Payments

There are two ways to postpone payments on federal loans: deferment and forbearance

Check promissory notes and disclosure statements for postponement options on non- federal loans including private and institutional loans.

Quick facts regarding deferment and forbearance:

  • Subsidized loans remain interest free during deferment
  • Interest accrues on all loans during forbearance
  • Borrowers remain in “good standing” during both deferment and forbearance
  • Borrowers must meet specific statutory requirements for deferment eligibility
  • There are multiple kinds of forbearance and loan servicers have some discretion granting forbearance
  • Borrowers must submit multiple requests if they have more than one loan servicer

Student Loan Debt Relief Plan

The Department of Education has a webpage dedicated to answering frequently asked questions regarding the Student Loan Debt Relief Plan. Since all parts of the plan are being administered by the Department of Education, we suggest you visit the page below for further information:

 If you would like to be notified by the U.S. Department of Education when there are any federal student loan updates, you may sign up at their subscription page linked below:

 The White House has also released a fact sheet containing data related to the debt relief and extension of the loan repayment pause which is available below: