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    Repaying Subsidized Stafford Loans

    In certain times, you don't pay the interest accruing on subsidized Stafford loans—the government handles it for you. However, by paying in these periods, you can put a big dent in what you repay overall.
    Updated: November 7, 2014

    What You'll Learn

    • Benefits of subsidized Stafford loans.
    • Limits to their availability.
    • How they're different from unsubsidized Stafford loans.

    The Highlights

    Are my payments due immediately?No
    Is it OK to make payments ahead of schedule?Yes
    Can I shrink my monthly payments?Yes
    Can I postpone repayment with a deferment?Yes
    Will the government pay the interest during the deferment?Sometimes
    Can I find these records online?Yes

    Dig Into The Details

    Who Do I Pay?

    Most likely, your servicer—a company hired by your lender to collect your payments. Contact them as well if you need to change your repayment schedule or postpone repayment.

    When Do My Payments Start?

    Six months after you graduate, withdraw, or drop below half-time enrollment. If you go back to school at least half time after using your grace period, your payments will restart as soon as you drop below half-time enrollment again.

    How Do I Know If I Have Subsidized Stafford Loans?

    Check the U.S. Department of Education's National Student Loan Data System (NSLDS®) for info on these federal student loans. NSLDS will tell you.

    • If you have unsubsidized Stafford loans.
    • How much you owe on them.
    • Who you should contact about repayment.

    What Payment Options Do I Have?

    Like other federal loans, subsidized Stafford loans may be eligible for a number of payment plans that could decrease the amount you owe each month. You also may be able to temporarily pause your payments with a deferment or forbearance.

    Be Money Smart

    Subsidized Stafford loans keep money in your pocket. Unlike with unsubsidizied Stafford Loans, the federal government usually pays the interest accumulating on them during:

    • Certain payment postponements.
    • When you attend school at least half of the time.    
    • Your 6-month grace period (if you borrowed these loans before July 1, 2012, or after June 30, 2014).

    Note: There are limits on the amount of time you can get subsidized Stafford loans and on when the government will cover your interest costs if you started borrowing these loans after July 1, 2013. Learn more.

    You can fatten your wallet even more by making payments even when interest isn't due. That way, the interest you're responsible for is based on a smaller balance. For instance:

    • If you borrowed $31,000 at 6.8%, you would owe more than $42,800 after 10 years.
    Amount Borrowed vs. Amount Paid
    • But, if you cut that starting principal to $29,000, your total repayment amount drops to about $40,000.
    Amount Borrowed vs. Amount Repaid

    • By paying $2,000 ahead of schedule, you save yourself $2,800 at the end of the loan.
    See What You've Saved!
    • And with that $700 you saved, you could buy a 50-inch flat-screen TV or a plane ticket to Mexico.

    Learn more about student loan repayment options with the SALT™ Repayment Navigator.

    Actualizado: 7 noviembre 2014
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