Repayment Options

• Most student loans automatically establish a repayment plan of 10 years, but other options are available. For example, some loans can use an income-based repayment program, in which payments are capped at 15 percent of the graduate's income, with all loans forgiven after 25 years.
  
  

Avoiding Delinquency and Default

• Student loans become due after nine months of failure to pay. When you default on your loans, your credit rating is destroyed, and the federal government has the right to garnishee your wages to pay the loan off.
  
  

Debt Consolidation

• Debt consolidation loans are available to combine multiple student loans into one loan with one monthly payment and one interest rate. The Department of Education makes debt consolidation loans for student loans even if banks won't do so.
  
  

Grace Periods

• Different types of student loans have different grace periods after graduation, the length of time during which you don't have to make payments. Make sure you know the specifics of your loans.
  
  

Deferments and Forbearance

• If a graduate can't make his loan payments because of health problems, unemployment or a return to school, some loans are eligible for deferments and forbearance, which postpone payment. However, interest continues to accrue during a deferment or forbearance.