When you graduate, withdraw from school, or drop below half-time enrollment status you will have six months before your first payment is due on your subsidized and unsubsidized loans. This is called a grace period. (PLUS Loans don’t have a grace period). This time can allow you to get financially settled, select your repayment plan and determine the amount of income you need to put toward your student loan each month.
If you have subsidized loans, you will not be charged interest during your grace period. If you have unsubsidized loans, you will be responsible for the interest that accrues during the grace period. You may pay this interest as it accrues during the grace period, or you may allow it to accrue and be capitalized (added to the principal balance of your loan) when your loan enters repayment. Your repayment period begins the day after your grace period ends. Your first payment will be due within 45 days after your repayment period begins.
PLUS loans do not have a grace period. The repayment period for a PLUS loan begins on the day after the final loan disbursement is made. However, you may defer repayment of a PLUS loan while you are enrolled in school on at least at halftime basis and, for PLUS loans with a first disbursement date on or after July 1, 2008, for an additional six months after you graduate, withdraw, or drop below half-time enrollment status. Your first payment will be due within 45 days after your deferment ends.
For interest rates please see below:
| Loan Type | Fixed Interest Rate with a First Disbursement Date on or After July 1, 2006 |
| Subsidized loans for undergraduate students | 6.80% for loans first disbursed 07/01/2006 to 06/30/2008 |
| 6.00% for loans first disbursed 07/01/2008 to 06/30/2009 | |
| 5.60% for loans first disbursed 07/01/2009 to 06/30/2010 | |
| 4.50% for loans first disbursed 07/01/2010 to 06/30/2011 | |
3.40% for loans first disbursed 07/01/2011 to 06/30/2012 3.40% for loans first disbursed 07/01/2012 to 06/30/2013 |
|
| Subsidized loans for graduate/professional students and unsubsidized loans for all students | 6.80% |
| Plus loans | 7.90% for Direct PLUS Loans |
| 8.50% for Federal PLUS Loans |
Sample repayment plan:
Non-consolidation borrowers*:
| Debt When Loan Enters Repayment | Standard Repayment Plan | Income Contingent Repayment Plan **for Income $25,000 | ||||
| Single | Married/HOH*** | |||||
| Per month | Total | Per Month | Total | Per Month | Total | |
| $5,000 | $58 | $6,904 | $37 | $8,347 | $36 | $11,088 |
| $10,000 | $115 | $13,809 | $75 | $16,699 | $71 | $22,158 |
*Payments are calculated using a fixed interest rate of 6.8% for Direct Subsidized and Unsubsidized Loans disbursed on or after July 1, 2006
** Assumes a 5 percent annual income growth (Census Bureau).
*** HOH is Head of Household. Assumes a family size of two.
