Use these FAQs if you previously visited Edfinancial.com for your online account access, know that you borrowed from a private lender, or have always received your correspondence from Edfinancial Services. Here you can find answers to many common questions, learn about student loans, and get some good advice on managing your student loan debt after college. Use the categories to the right to find what you need, or contact us if you need assistance.
- What is an Economic Hardship Deferment?
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This deferment postpones payments during times of financial difficulty for a period of up to one year at a time, and the maximum total deferment time is three years. There are numerous ways to qualify, such as if you are currently on a deferment with Direct or Perkins, receiving federal or state public assistance, serving in the Peace Corps or if you meet specific income criteria. To qualify, complete and return the form, and provide supporting documentation dated within 90 days of your requested start date.
Download the Economic Hardship Deferment form as a fillable PDF.
*NOTE: Use this form only if all of your outstanding Federal Family Education Loan (FFEL) Program loans were made on or after 7/1/93 and when your first FFEL Program loan was made on or after 7/1/93, you had no outstanding FFEL Program loans that were made before 7/1/93.
Deferment Types
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- What is an In School Deferment?
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This deferment postpones repayment while you are attending a Title IV school on at least a half-time basis. A Title IV school is one that grants federal funding (i.e. Pell grants, Stafford Loans, etc.). You can check here to verify that your school is a Title IV program. Full-time, half-time, or less than half-time enrollment is determined by your institution and must be clearly marked on the form. You must be attending at least half-time to receive this deferment.
Download the In School Deferment form as a fillable PDF.
Deferment Types
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- What is an Unemployment Deferment?
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This deferment postpones repayment while you are unemployed or working less than 30 hours per week. To receive this deferment, you must certify that you are diligently seeking full-time employment at this time and registered with a public employment agency, or you are receiving unemployment benefits and provide documentation of these benefits.
Download Unemployment Deferment the form as a fillable PDF.
Deferment Types
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- What is a PLUS Borrower with Dependent Student Deferment?
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This deferment postpones payments for parent loans while the student for whom they borrowed a PLUS loan is still a dependent and is either enrolled full-time at an eligible school, enrolled at least half-time at an eligible school or is engaged full-time in a rehabilitation training program.
Download the PLUS Borrower with Dependent Student Deferment form as a fillable PDF.
*NOTE: Use this form only if you have an outstanding balance on a Federal Family Education Loan Program Loan that was made before 7/1/93, or had a balance on a loan that was made before 7/1/93 at the time you obtained a loan disbursed on or after 7/1/93.
Deferment Types
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- What is a Military Deferment?
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This deferment postpones payments during times the borrower is called to active duty, mobilized or deployed in support of an operation or national emergency. To qualify, you must provide either a deferment form completed by your commanding officer or supporting documentation showing your active duty, mobilized, or deployed status and the effective beginning and ending dates of service.
Download the Military Deferment form as a fillable PDF.
Deferment Types
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- What is a Temporary Total Disability Deferment?
- This deferment postpones payments for a borrower while they are temporarily totally disabled or while they are unable to secure employment because they are caring for a spouse or dependent who is temporarily totally disabled.
Download the Temporary Total Disability Deferment form as a fillable PDF.
*NOTE: Use this form only if you have an outstanding balance on a Federal Family Education Loan Program Loan that was made before 7/1/93, or had a balance on a loan that was made before 7/1/93 at the time you obtained a loan disbursed on or after 7/1/93.
Deferment Types
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- What is a Parental Leave / Working Mother Deferment?
- This deferment postpones payments for a borrower who qualifies for Parental Leave or Working Mother eligibility criteria.
Parental Leave is defined as a borrower who:
Is pregnant, caring for a newborn child (a child less than six months of age), or caring for a newly adopted child Is not working full-time or attending school during the deferment period; and Has been enrolled in school at least half-time within the six-month period preceding this deferment. A Working Mother is defined as a borrower who:
Has entered or reentered the workforce within one year preceding this deferment; Is working full-time in a position earning not more than $1 per hour above the federal minimum wage; and Is the mother of a preschool-age child who has not yet enrolled in the first grade or a higher grade in elementary school.
Download the Parental Leave/Working Mother Deferment form as a fillable PDF.
*NOTE: When applying for the Parental Leave deferment, use this form only if all of your outstanding Federal Family Education Loan (FFEL) Program loans were made on or before 7/1/93 or if a FFEL Program loan was made on or after 7/1/93, you had outstanding FFEL Program loans that were made before 7/1/93. If you are a Federal PLUS or Federal Consolidation Loan borrower, you are not eligible for the Parental Leave Deferment.
*NOTE: When applying for the Working Mother deferment, use this form only if you are a Federal Stafford or SLS borrower whose first FFEL Program loan was made on or after 7/1/87, and before 7/1/93. If you are a Federal PLUS or Federal Consolidation Loan borrower, you are not eligible for the Working Mother Deferment.
Deferment Types
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- What is a Public Service Deferment?
- This deferment postpones repayment for borrowers who are:
On active duty in the Armed Forces Serving full-time in the Commissioned Corps of the Public Health Service Serving in the Peace Corps A full-time paid volunteer in the Action Programs A full-time paid volunteer for a tax-exempt organization On active duty in the National Oceanic and Atmospheric Administration (NOAA)
Download the Public Service Deferment form as a fillable PDF.
*NOTE:
You must have a loan that was disbursed prior to 7/1/93 to be eligible for this deferment.
Deferment Types
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- What is an Education Related Deferment?
- This deferment postpones payments for borrowers who are engaged in a full-time course of study in a Graduate Fellowship program, engaged in a full-time Rehabilitation Training program, engaged in an Internship/Residency program or teaching in a designated Teacher Shortage Area.
Download the Education Related Deferment form as a fillable PDF.
*NOTE: When applying for the Internship/Residency deferment, use this form only if all of your outstanding Federal Family Education Loan (FFEL) Program loans were made on or before 7/1/93 or if a FFEL Program loan was made on or after 7/1/93, you had outstanding FFEL Program loans that were made before 7/1/93. If you are a Federal PLUS Loan borrower, use this form only for PLUS loans that were made before 8/15/83.
*NOTE: When applying for the Teacher Shortage Area deferment, use this form only if you are a Federal Stafford or SLS borrower whose first FFEL Program loan was made on or after 7/1/87, and before 7/1/93, or if you had an outstanding balance on a loan obtained on or after 7/1/87, and before 7/1/93, when you obtained a loan on or after 7/1/93. If you are a Federal PLUS Loan borrower you are not eligible for the Teacher Shortage Area deferment.
Deferment Types
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- How can I make a payment?
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Edfinancial Services gives you several ways to make your student loan payments:
- Use our Auto Debit payment plan to have payments automatically drafted from your checking or savings account each month. Download the Auto Debit payment plan application here (PDF).
- Call us at 1-866-709-0202 to make a payment using our automated phone payment system.
- Effective 4/15/2011, payments made through the interactive voice response system (pay-by-phone) will be subject to a $6.00 convenience fee.
- Mail us your payment along with the payment coupon from your monthly statement.
- Go to Make a Payment. Click the link on the left to "Create an Account." The website will guide you through the steps to create a new account, including setting your username and password, selecting a site image, and choosing security questions.
After logging into your account, choose the option “Make a Payment” to access our online payment system.
Student Loan Repayment Info
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- If I change my repayment plan, will the total amount I have to repay stay the same?
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Depending on the repayment plan you select, the total amount to be repaid over the life of the loan may increase.
With Extended Repayment, your payments are spread out over a longer period of time. Your monthly payment will be less, but you will pay more in interest over the life of the loan because it will take longer to pay your loan in full.
With Graduated Repayment, you pay mostly interest in the first few years of repayment, and then begin paying on the principal balance later. Your monthly payment will be less in the beginning, but will increase over time. Delaying repayment of the principal balance may increase the amount of interest you pay over the life of the loan.
Income-Based Repayment (IBR) is a new repayment option that caps your monthly payment at 15% of your discretionary income. Discretionary income is the difference between adjusted gross income (AGI) and 150% of the federal poverty line that corresponds to your family size and state of residence. The monthly payment amount is adjusted annually based on changes in annual income, state of residence, and family size. IBR is available for Stafford, GradPLUS, and Consolidation loans (consolidation loans must not include any Parent PLUS loans). Any balance outstanding at the end of 25 years will be forgiven with 25 years of eligible payments.
Another option, Income Sensitive Repayment, lowers your monthly payment amount by basing your payments on a percentage of your income (from 4% to 25%), allowing you to extend your repayment period up to fifteen years. Individual repayment schedules will vary based on the borrower's income and loan balance. Your monthly payment will be less, but you will pay more in interest over the life of the loan because it will take longer to pay your loan in full.
Student Loan Repayment Info
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- If I requested a change to my repayment plan, how will I know my request was approved?
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If your account is placed on new repayment options, you will receive a notice in the mail regarding the details of your new repayment schedule.
Student Loan Repayment Info
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- How do I change my repayment plan?
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Please contact us to discuss the repayment options that work best for you.
Student Loan Repayment Info
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- What do I do if my payments are delinquent, or I can’t make my payments?
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Please contact us as soon as you think you will be unable to pay. You may have differentrepayment options available to you, such as a different repayment plan, deferment or forbearance.
Student Loan Repayment Info
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- What are my student loan repayment options?
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If you need some help making your student loan payments each month, read about various student loan repayment options to help you manage your student loan debt.
Student Loan Repayment Info
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- I received my monthly bill, but the amount due is zero. What's going on?
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If you paid more than the amount due on your student loans, it's possible that you are paid ahead on your account. Payments you make are credited first to any outstanding payment due. If you send more than the amount due for your loans, any additional amount will be applied to a future payment. If the amount you paid in excess of the amount due is enough to satisfy the next month's payment, your next month's payment due will be zero.
If you are in paid ahead status with no payment due, you can continue to make payments as you would normally. Interest will continue to accrue on your outstanding balance even though you are paid ahead.
A benefit of being paid ahead is it can give you a financial cushion. Not having to pay your student loan bill one month might be helpful if you have some additional or unexpected expenses that month.
If you would prefer to have your monthly bill reflect the full monthly installment due each month, you can submit, in writing, a request for the paid ahead status to be removed from your account. You can find our mailing address on the Contact Us page.
Whether you are in paid ahead status or not, your payment will be applied in the same manner using a simple interest payment application. The only difference is how your monthly bill displays the amount due. Payments are applied to late fees (if any) and then to outstanding interest first. Any remaining amount is applied to the principal balance.
Student Loan Repayment Info
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- How can I find out if my loan is in deferment or forbearance?
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If you have an online account, you can quickly see your loan status by taking the following steps. (If you don't have an online account, create one at Make a Payment.)
- Go to Make a Payment to log into your online account.
- On the first page, look for a list of your loans on the right side of the screen. You may see several loans listed, and each loan will probably correspond to one academic period of school.
- Click the linked "first disbursement date" next to each loan to see that loan's detail.
- In the Loan Servicing Details section, look for loan status in the first column. If your loan is in deferment or forbearance, it will be listed here. Other possible statuses are repayment, grace, claim submitted and paid in full, to name a few. You can look at each loan individually to see its status.
If you are unable to determine your loan status, or you have questions about your status, you may contact us by phone or email to discuss your account. Please note that if a deferment or forbearance was recently applied to your account, you will receive written confirmation of your deferment or forbearance status by mail.
Student Loan Repayment Info
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- I'd like to make a payment on only the interest that's accruing on my loans. How can I do that?
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If your payments are currently suspended due to deferment or forbearance, you may want to continue making payments on the interest that accrues to avoid capitalization of that interest. (For more information, view the help topic on student loan interest.) If you have an online account, you can quickly determine your amount of unpaid interest using the following steps. (Don't have an online account? Go to Make a Payment to create one.)
- Go to Make a Payment to log into your online account.
- On the first page, look for a list of your loans on the right side of the screen. You may see several loans listed, and each loan will probably correspond to one academic period of school.
- Click the linked "first disbursement date" next to each loan to see that loan's detail.
- In the Loan Servicing Details section, look for the Unpaid Interest amount at the bottom of the first column.
- Sum this amount for each loan listed and this is your total unpaid interest.
- Any payment you make will be applied first to outstanding interest, unless late fees are assessed. Interest accrues daily; therefore, the amount of unpaid accrued interest changes daily. Any amount paid above interest accrued will be applied to the principal balance. You can make payments online, over the phone or by mail. Read the help topic about "How do I make a payment?" for more information. If you are unable to determine your interest amount, or you have questions about interest payments, you may contact us by phone or email to discuss your account.
Student Loan Repayment Info
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- What if I can't afford my minimum monthly payment?
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Please contact us as soon as you think you will be unable to pay. You may have several repayment options available to you, such as a different repayment plan, deferment or forbearance.
Managing Student Loan Debt
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- What if my loans are delinquent, but I want to apply for a different repayment plan, deferment or forbearance?
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You may still apply for different repayment options, deferment or forbearance, regardless of whether your account is delinquent. Certain types of deferments or forbearances may not be available depending upon the extent of your delinquency, but you may still have several options available to you. Please contact us as soon as possible to resolve the delinquency.
Managing Student Loan Debt
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- How do I know if I am eligible to reduce or postpone my payments?
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There are various repayment options available to help you manage your student loan debt. You may be eligible for a different payment plan with a lower monthly payment amount.
You can use our form selector under Online Forms to see if you qualify for a deferment or forbearance. You can select different scenarios that apply to your situation, and the Form Selector will tell you, based on your answers, which programs you may qualify for. You will also have the option to download and print the applicable forms from the Form Selector.
Managing Student Loan Debt
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- What fees could potentially be added to my account?
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Once in repayment, there are two types of fees that could potentially be added to your student loan account: late fees and returned payment fees.
Most lenders charge a late fee if you do not make your payment on time. Usually, these fees are charged as a percentage of your monthly payment. Many lenders provide for a grace period before they charge a late fee. For example, if the lender’s grace period is five days, a late fee would be charged six days after the payment is due, if a payment has not been received.
Most lenders also charge a fee if your bank returns your payment for any reason and does not honor it. Some of the reasons a payment may be returned are insufficient funds in the specified account, the bank is unable to locate the account, or a stop payment order has been placed upon a check or payment.
Managing Student Loan Debt
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- How can I find out if my loan is in deferment or forbearance?
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If you have an online account, you can quickly see your loan status by taking the following steps. (If you don't have an online account, go to Make a Payment to create one.)
- Go to Make a Payment to login to your online account.
- On the first page, look for a list of your loans on the right side of the screen. You may see several loans listed, and each loan will probably correspond to one academic period of school.
- Click the linked "first disbursement date" next to each loan to see that loan's detail.
- In the Loan Servicing Details section, look for loan status in the first column. If your loan is in deferment or forbearance, it will be listed here. Other possible statuses are repayment, grace, claim submitted and paid in full, to name a few. You can look at each loan individually to see its status.
If you are unable to determine your loan status, or you have questions about your status, you may contact us by phone or email to discuss your account. Please note that if a deferment or forbearance was recently applied to your account, you will receive written confirmation of your deferment or forbearance status by mail.
Managing Student Loan Debt
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- How does interest accrue if I am late on a payment?
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Interest accrues on the unpaid principal balance during the periods between the dates we have received payments. If the accrued interest is not paid, the excess interest remains due on your loan(s).
Interest accrues using the simple daily interest formula:
(Unpaid Principal x Interest Rate) ÷365.25 = Daily Interest
And then,
Daily Interest x Number of Days = Interest Due
Managing Student Loan Debt
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- If I did not receive my statement, am I still responsible for making my monthly payment?;
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Yes. You are always responsible for making timely payments on your loans, regardless of whether you receive your statement in the mail. If you fail to make your monthly payments, you may incur late fees and negative credit reporting.
If you are having trouble making your payments, consider your repayment options. You may have different repayment plans, deferment or forbearance available to help you manage your student loan debt.
General Information on Student Loans
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- If I am in school, grace, deferment, or forbearance and I receive a statement, do I need to make a payment?
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If your federal student loans are in one of these statuses, you are not required to make payments. You can, however, make payments on your loans at any time to apply towards any outstanding interest and to reduce your principal balance. Some private loans will require payments while the student is in school. If you have a private loan and are not sure if payments are required while in school, check the terms of the promissory note or call us at 1-800-337-6884 to speak with a representative.
General Information on Student Loans
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- Will I receive a monthly statement?
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Yes, Edfinancial Services mails monthly statements approximately 20 days before your due date. You also have the option to choose electronic billing or automatic debit payments to cease receiving paper statements.
If you are in school, grace, deferment, or forbearance, you may not receive a monthly statement. You can still check your account status through our online account access system.
General Information on Student Loans
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- How do I make a payment?
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Edfinancial Services gives you several ways to make your student loan payments:
- Use our Auto Debit payment plan to have payments automatically drafted from your checking or savings account each month. Download the Auto Debit payment plan application here (PDF).
- Call us at 1-866-709-0202 to make a payment using our automated phone payment system.
- Effective 4/15/2011, payments made through the interactive voice response system (pay-by-phone) will be subject to a $6.00 convenience fee.
- Mail us your payment along with the payment coupon from your monthly statement.
- Go to Make a Payment. Click the link on the left to "Create an Account." The website will guide you through the steps to create a new account, including setting your username and password, selecting a site image, and choosing security questions.
After logging into your account, choose the option “Make a Payment” to access our online payment system.
General Information on Student Loans
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- Can I update my contact information through your website?
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Yes! Just hover over the Contact tab in the top navigation of edfinancial.com. You will see a menu roll down with links to various contact information pages. The first one is "update my information.” Click the link and complete the online form. You will need to complete the top section with your name, Social Security Number and date of birth, and any other sections that relate to information you'd like to update. With this form, you can change your email address, mailing address or phone number. You can leave blank any section that you do not wish to update.
General Information on Student Loans
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- I'm looking for a deferment, forbearance or other form to make changes to my account. How can I find these forms?
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Hover over the Manage My Account tab in the top navigation of edfinancial.com. You'll see a menu roll down with links to Online Forms. If you already know which form you are looking for, or you are looking for forgiveness/discharge applications, automatic debit sign up, income sensitive repayment worksheet, forms in Spanish or other miscellaneous forms, select the complete list of forms. This is a comprehensive list of all student loan-related forms on our website, and you can quickly download and print the form you need.
If you need a deferment or forbearance form but aren't sure which form you need, select the link for find the right form. This link leads to our form selector tool that will guide you through the process of selecting the correct deferment or forbearance form for your situation.
General Information on Student Loans
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- I'd like an amortization schedule for my loans. Where can I find one?
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There are many amortization calculators available on the internet. You can search for "amortization schedule calculator" in any search engine and get many free options.
General Information on Student Loans
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- My last name changed. How can I update this?
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Please send us a copy of your name change documentation along with your account number and a written request to change the name on your account. Acceptable documentation is either a copy of a court order, marriage certificate, or Certificate of U.S. Naturalization. You may mail or fax it to us at the following address:
Edfinancial Services
P.O. Box 36014
Knoxville, TN 37930-6014
Fax: 865-692-6386
- I am applying for a mortgage and need a letter with my account details to give the mortgage company. How can I request this letter?
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Please call us at 1-800-337-6884 with your request. One of our representatives can send you the letter by e-mail, fax, or regular mail. Allow 1-2 business days for this request to be processed.
General Information on Student Loans
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- Do I have to pay back my student loans?
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Yes. You are obligated to repay the loan according to the terms of the promissory note you signed when you first applied for the loan. You need to repay the principal amount of the loan, as well as any interest and fees associated with the loan. If you choose not to repay your loan, your account will be delinquent, which will affect your credit history and future eligibility for financial aid.
If you have trouble making your payments, contact us immediately to see what other options may be available to you. We may be able to reduce or postpone your student loan payments through different repayment options, deferment or forbearance.
General Information on Student Loans
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- What’s the difference between federal student loans and private student loans?
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Federal student loans are guaranteed by the federal government through the Direct loan program. Federal loans include Stafford, Parent PLUS, and GradPLUS. Federal student loans have low interest rates and flexible repayment terms to help students of various economic backgrounds gain access to higher education. Private loans are not guaranteed by the federal government. They are similar to bank loans and their interest rates may be based on an index, such as Prime or LIBOR. The interest rate for private loans will depend on the borrower’s, and sometimes the co-borrower’s, credit history. Private loans are intended to close the gap between the amount students can borrow under the federal student loan programs and the cost of higher education.
General Information on Student Loans
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- Will I receive monthly statements if I return to school?
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If you return to school and your FFELP loans are placed in a deferment status, you will no longer receive monthly statements.
General Information on Student Loans
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- Can I apply for more loans through Edfinancial Services?
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No. Due to the enactment of the Health Care and Education Reconciliation Act of 2010, you will not be able to use a FFELP lender for your Federal Stafford, PLUS and/or GradPLUS Loans effective July 1, 2010.
Your college or university will process your 2011-2012 loans through the U.S. Department of Education's Federal Direct Loan Program. Information and directions should be available from your school on how to apply.
Please note that Edfinancial Services will continue to service your prior loans unless otherwise notified.
General Information on Student Loans
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- Does Edfinancial own my student loans?
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No. We service loans for many different lenders, so your loan is owned by one of our servicing clients. You can find out who owns your loans by logging in to our online account access system. Under the “Your Loans” section, select one of your loans to view its details. In the “Loan Servicing Details” section, the owner of your loan will be listed in the top row of information under the heading “Owner.”
General Information on Student Loans
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- Why do I receive more than one monthly statement?
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If your loans are not consolidated, you may receive a statement for each loan or group of loans in your name. If you would like to receive fewer statements, you can either contact us to request combined billing, which will align all your payment due dates and allow you to receive one statement for all your loans, or you can go toMake a Payment to sign up for eBilling through our online payment system and receive your bills electronically.
General Information on Student Loans
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- Is your web site secure?
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The security of your personal information is important to us. When you enter sensitive information (such as your social security number) into our registration or online forms, we encrypt that information using secure socket layer technology (SSL). To learn more about SSL, visit http://info.ssl.com/article.aspx?id=10068.
You can see SSL in action when you visit a page on our site that allows you to enter your personal information. Notice the address of the page you visit. If it is a secured page, you will see HTTPS, rather than HTTP, at the beginning of the URL:
You can also look for an icon in the browser window that indicates the page is secure. Often, this icon resembles a padlock and can be found near the address bar, as shown above.
In addition to the use of SSL technology, we follow industry accepted best practices for protecting personal information during transmission. While no method of communication over the Internet or electronic storage is ever 100% secure, we have gone to great lengths to protect your personal information through the use of layered firewalls and intrusion detection/protection systems. All of our systems provide extensive logging and automated reporting of issues enabling timely response, interdiction and corrective actions if necessary.
General Information on Student Loans
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- How can I authorize Edfinancial Services to release information about my account to a third party?
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You can complete and submit the Information Release form (PDF) found on our website. Return the form to Edfinancial Services according to the instructions found on the form. Please note this form only authorizes the release of information; it does not give authorization to make changes on the account such as deferments, forbearances or due date changes. Only the borrower or an agent authorized by Power of Attorney can request these changes to an account.
General Information on Student Loans
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- What is income-based repayment?
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Income-Based Repayment is a repayment plan that can help you manage your student loan debt by lowering your monthly payments. IBR will help make loan payments more manageable by calculating your payment amount based on your adjusted gross income (AGI) and family size. Read more about Income Based Repayment.
In order to qualify, you must demonstrate a partial financial hardship (PFH), and if you do, your payments will be capped at 15% of your discretionary income. While under this plan, your situation will be evaluated annually to determine if your PFH has continued. There are additional benefits such as restricted capitalization, loan forgiveness, and interest subsidies that may also be available while on this repayment plan.
If you think IBR may be right for you, use our IBR calculator to see if you qualify. You may also contact us by email or call us at 1-800-337-6884 if you have questions.
Income-Based Repayment
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- Which borrowers and loans are eligible for IBR?
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All borrowers are eligible for this plan as of July 1, 2009, for repayment on Stafford, GradPLUS, and consolidation loans. Parent PLUS loans and consolidation loans that include Parent PLUS loans are not eligible for IBR.
Use our IBR calculator to see if you qualify.
Income-Based Repayment
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- How are payments calculated under IBR?
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Monthly payments are calculated as 1/12th of the following:
15% x [AGI - (150% poverty line applicable to family size)]
Income-Based Repayment
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- Are defaulted loans held by the guarantor eligible for IBR?
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No, defaulted loans held by guarantors are not eligible for IBR. If a defaulted loan is rehabilitated and repurchased by a Title IV lender, however, that loan then becomes eligible for IBR.
Income-Based Repayment
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- What is adjusted gross income (AGI)?
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AGI is the borrower’s adjusted gross income as reported to the Internal Revenue Service (IRS). For a married borrower filing jointly, AGI includes both the borrower’s and spouse’s income, and for a married borrower filing separately, only the borrower’s income.
Income-Based Repayment
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- What is family size?
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Family size is determined by counting the borrower, the borrower’s spouse, and the borrower’s children, including unborn children who will be born during the year the borrower certifies family size, if the children receive more than half of their support from the borrower.
A borrower’s family size also includes other individuals if, at the time the borrower certifies family size, the other individuals live with the borrower and receive more than half their support from the borrower and will continue to receive support from the borrower for the year the family size is certified.
Support includes money, gifts, loans, housing, food, clothes, car, medical and dental care, and payment of college costs.
Income-Based Repayment
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- What is Partial Financial Hardship (PFH)?
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PFH is a circumstance in which the annual aggregate amount due on all of a borrower’s eligible FFEL and Direct loans, as calculated under a standard repayment plan based on a 10-year repayment period at the time the borrower initially entered repayment, exceeds 15% of the difference between the borrower’s adjusted gross income and 150% of the poverty line for the borrower’s family size.
Income-Based Repayment
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- What is Poverty Line Income?
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Poverty line income is the income categorized by state and family size in the Poverty Guidelines published annually by the United States Department of Health and Human Services (HHS) pursuant to 42 U.S.C. 9902(2). If a borrower is not a resident of a state identified in the Poverty Guidelines, the borrower’s family line income is the income used for the 48 contiguous states.
Income-Based Repayment
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- What does it mean when interest is capitalized? When does it occur?
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Interest accrues on the principal balance of your loan during times when a payment is not required to be made on a loan. For FFELP loans, deferment, forbearance, grace, and in-school statuses are all examples of times when a payment is not required. If it is unpaid, accrued interest is usually capitalized when the loan goes into repayment; the accrued interest is added to the principal balance of your loan, which increases the total outstanding balance due.
Because interest continues to accrue on the principal balance if a payment is not made, any future interest that accrues after capitalization will be based on the new outstanding principal amount (previous principal balance plus capitalized interest). Therefore, capitalization increases the total cost of your loan.
You can avoid the cost of capitalization by making payments during any period when they are not due. For certain federal student loans, including unsubsidized Stafford, Parent PLUS and GradPLUS, federal law permits unpaid interest to be added (capitalized) to your principal balance at certain times during your loan term. These times where unpaid interest may be capitalized can include after your grace period, at the end of deferment, and at the end of forbearance.
For private loans, consumer law permits unpaid interest to be capitalized at the frequency stated in the terms of the promissory note that you sign.
Student Loan Interest
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- How is student loan interest calculated?
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Most student loans (including all federally guaranteed loans) use a method of interest accrual known as simple interest. The difference between simple interest and compound interest (the type of interest that accrues on most major credit cards) is that simple interest is only calculated on the principal balance, not on the previously accrued interest.
To calculate your daily interest accrual, use the following formula: (Current Principal Balance x Interest Rate) ÷ 365.25
This formula says to multiply your current principal balance by the interest rate and then divide the result by 365.25 (the number of days in one year). The result is your daily interest accrual, or how much interest you would pay for one day. You can multiply this number by a specific number of days to calculate your interest accrual over a certain amount of time.
Example:
- Current principal balance: $20,000.00
- Interest rate: 4.50%
- Days of interest needed: 30
Just plug in the numbers to calculate the approximate 30 day interest accrual: [(20,000 x .045) ÷ 365.25] x 30 = $73.92
Student Loan Interest
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- Will switching repayment plans or using a deferment or forbearance hurt my credit history?
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No. The type of repayment plan you use to repay your student loan is not reported to the credit bureaus. Using a deferment or forbearance for your student loans will not adversely affect your credit history. Making a late payment or not making a payment at all will hurt your credit history. Requesting a deferment or forbearance to clear delinquency on your account will not remove any negative credit history that has already been reported.
Student Loans and Your Credit
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- I have paid off my loan, but it is still showing on my credit report. Why?
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Education loans will typically remain on your credit history for seven years from the last reported date. The status or reason for loans paid in full include: paid in full by the borrower, claim paid, paid due to consolidation, and paid due to transfer. Example: If your loan was paid in full in March 2005, the final report of paid in full will most likely remain on your credit history until February 2012.
Student Loans and Your Credit
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- My address changed, and I didn’t receive a bill for several months. I brought the account current when I realized what happened. Can you clear the delinquency that was reported?
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No, we are unable to remove anything that was reported accurately on your credit. In this case, you are still responsible for any monthly payments on your student loan even if you do not receive a bill. Sometimes, deferment or forbearance can clear delinquency from credit, but those situations require you to meet specific qualifying criteria. If your address changes, please notify Edfinancial Services as soon as possible to ensure you continue to receive your monthly statements. To notify Edfinancial Services of an address update, use the link to update your information on the Contact us page, or contact one of our customer service specialists by phone or email.
Student Loans and Your Credit
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- I had a deferment/forbearance placed on my loan, and I am still showing as delinquent for those months that it covered. Why?
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Deferments and forbearances can allow you to bring your account current without making a payment to do so, but they do not always clear up negative credit reporting that already occurred. Certain eligible deferment periods, such as an in-school deferment, will clear any previous negative reporting if the qualifying deferment period occurred at the same time as the negative reporting period. Forbearances, even if applied retroactively, rarely clear prior negative reporting.
Student Loans and Your Credit
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- My spouse and I are divorced, and I am no longer required to make payments toward the student loan even though it still includes my name. Will this loan affect my credit if my former spouse doesn’t make his/her payments?
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Both parties are liable for the loan even if the court declares one party to be solely liable. If your former spouse doesn’t make payments, the delinquency will be reported on your credit history as well as your former spouse’s credit history. Also, any person who is an endorser on a loan is liable and could have negative reporting due to delinquency on an account.
Student Loans and Your Credit
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- I only have one account with Edfinancial Services, but there are multiple loans showing on my credit report. Why?
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Although you only have one account with us, each loan that you take out has its own tradeline that is reported to the credit bureaus. (Each loan is called a tradeline in credit reporting.) Also, Stafford Loans may be split depending on subsidy and will report as two separate loans if you have both subsidized and unsubsidized Stafford Loans. Depending on the number of years that you were in school, you may see several loans that will each display separately on your credit report.
Student Loans and Your Credit
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- What if this information really does not belong on my credit report?
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If you have researched and discovered that this information truly does not belong on your credit report, you can contact the three credit bureaus either online or by calling their toll-free numbers to dispute the information. The process can take up to two months to be completed, but the incorrect items should be removed from your credit history. Click the name of a credit bureau for more information about credit disputes:
Transunion
Experian
Equifax
Student Loans and Your Credit
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- My loan defaulted, but I made payment arrangements with the guarantor to get it out of default. Now it is showing up three times on my credit report. Why?
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Each loan is considered a tradeline to the credit reporting agencies when it is originated. After the loan defaults, it is transferred to the guarantor for reporting, which creates a new tradeline. Once the loan is rehabilitated and taken out of default, the loan returns to Edfinancial Services and establishes a third tradeline for current reporting. You now have three separate tradelines for one loan: the original loan reporting, the guarantor reporting, and the new reporting after rehabilitation.
Student Loans and Your Credit
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- I have heard that if I continue to dispute the information on my credit that the items will eventually be removed. Is this true?
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No, this is not true. If the information reported on your credit history is inaccurate, it will be updated with the first dispute that you file. Data furnishers are required to report the account information accurately and in an unbiased manner.
Student Loans and Your Credit
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- What is the PUT Program?
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On May 7, 2008, the Ensuring Continued Access to Student Loans Act (ECASLA) was signed into law, thus creating the PUT Program. This legislation authorizes the U.S. Department of Education to purchase federal student loans from lenders to ensure on-going liquidity and availability of funds for student loans. The purpose of the program is to provide lenders with the means to continue offering student loans to students.
PUT Program
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- If I want my loans with one lender, can I consolidate? Doesn't Direct Lending offer consolidation?
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Yes, you can consolidate your loans through Direct Lending, but the only real benefit is combined billing. Depending on your repayment terms, you will likely pay more interest over the term of your loan, so it could cost you more money in the long run. Since Edfinancial Services offers electronic funds transfer (EFT), we can automatically debit your checking or savings account for our serviced loans so you won't have to write two checks.
PUT Program
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- I was offered/saw on the website that I would have “life of the loan servicing” by Edfinancial Services for Edamerica. Is that not true?
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Edfinancial Services provides student loan servicing for more than a dozen of the nation’s top 100 lenders. Due to recent legislation and an unprecedented liquidity crisis, many lenders, including Edamerica, have been forced to change their business models. In order to continue to make new loans to students and parents, lenders are relying on the Department of Education and the U.S. Treasury for funding, rather than on the student loan secondary markets that traditionally purchased and held student loans. Right now, the Department of Education has its own service provider, and it’s not Edfinancial Services.
PUT Program
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- If my loan(s) is transferred to the Department of Education, does that mean that it is now considered to be a Direct Loan?
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No. The loan is still a FFEL program loan and is not considered to be a Direct Loan.
PUT Program
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- Will my deferment/forbearance automatically be applied on my loan(s) that was transferred to the Department of Education?
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You will need to send a copy of the deferment/forbearance request to the Department of Education Servicing Center to request a deferment/forbearance for any loan(s) transferred to them. You may have other loans that are not included in this loan transfer, and we will process your deferment/forbearance for any loan(s) that continues to be serviced by Edfinancial Services.
PUT Program
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- What if I need to take out an additional loan next year?
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Due to the enactment of the Health Care and Education Reconciliation Act of 2010, you will not be able to use a FFELP lender for your Federal Stafford, PLUS and/or GradPLUS Loans effective July 1, 2010.
Your college or university will process your new 2011-2012 loans through the U.S. Department of Education’s Federal Direct Loan Program. Information and directions should be forthcoming from your school.
Please note that Edfinancial Services will continue to service your prior loans unless otherwise notified.
PUT Program
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- Are all my current student loans affected by the PUT Program?
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You may have other loans with Edfinancial Services that are not impacted by this loan transfer and can be viewed at www.edfinancial.com. The ECASLA only authorizes lenders to sell loans disbursed for the 2007/2008, 2008/2009 and 2009/2010 academic years. If you have loans for prior academic years, these loans will remain with your lender and current servicer. Please refer to the loan transfer notification sent by Edfinancial Services to view the details of what loan(s) will be transferred to the Department of Education. It is important that you keep careful records of your student loans, who holds them and who services them.
PUT Program
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- What if I do not want to participate in the PUT Program?
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Unfortunately, the decision to participate in the PUT program is determined by your lender. The lender of your student loan(s) is authorized to sell your loan to the U.S. Department of Education under ECASLA.
PUT Program
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- How will this transfer of ownership under the PUT Program change my loan?
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The terms and conditions of your loan will not be impacted by the transfer of ownership. All future payments and correspondence regarding your loan(s) that has been sold should now be directed to the Department of Education Student Loan Servicing Center. If you have any questions regarding the loan(s) that has been transferred, please contact the Department of Education Student Loan Servicing Center at 1-800-508-1378, Monday through Friday 8:00 a.m. to 11:00 p.m., ET. Please be advised that you may have other loans through this lender that are not impacted by the PUT Program. If you have other loans serviced by Edfinancial Services, please continue to communicate with Edfinancial Services regarding those loans.
PUT Program
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- How will payments be applied under the PUT Program?
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If you have recently sent any payments intended to be applied toward a loan(s) that is being transferred, we will work with the Department of Education Servicing Center to ensure that any applicable payments are transferred to them in a timely manner. You may have other loans that are not included in this loan transfer that will continue to be serviced by Edfinancial Services, and your payment will be applied to your account. Payments received are first applied to outstanding interest, and the remainder is applied to the principal balance, unless late fees have been assessed. Since this is a federal loan, you do not prepay interest, and there is no prepayment penalty.
PUT Program
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- Do I still have to make payments if my loan is transferred under the PUT Program?
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Yes. The sale of your student loan(s) does not affect the terms and conditions governing the loan(s). Your loans will still be subject to all the terms and conditions stated in the Master Promissory Note (MPN) that you signed to take out the loan. You may have other loans that are not included in the loan transfer that will continue to be serviced by Edfinancial Services. You will receive repayment information from the Department of Education Servicing Center for any loan(s) transferred to them.
PUT Program
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- What is e-correspondence?
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E-correspondence allows you to receive communications regarding your account via email which will reduce the amount of paper correspondence you receive by conventional postal delivery services and save trees at the same time!
E-correspondence Info
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- How do I sign up for e-correspondence?
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In order to sign up for e-correspondence, visit www.Edfinancial.com/BePaperFree for a quick registration process. You will receive an email from Edfinancial Services confirming your registration. If you have never registered for online account access via our borrower portal at Make a Payment, you will receive an email instructing you that you must register for online account access in order to participate in e-correspondence. Once you have created your account, your e-correspondence registration will be complete and you may receive electronic communications from Edfinancial Services.
E-correspondence Info
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- I already have an online account. How is e-correspondence different?
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Online account access provides you with useful tools and information such as:
- loan details including interest rate and repayment terms
- online payment access
- calculators and helpful articles about student loans
- loan balance and payment history
- information on repayment plans, deferment and forbearance
E-correspondence is an additional process that allows Edfinancial Services to send you communications that may include payment confirmations, information about your repayment options, and required annual privacy policy notices. If you have not already registered for e-billing, you may also do so via the e-correspondence registration (www.Edfinancial.com/BePaperFree).
E-correspondence Info
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- What are the benefits of e-correspondence?
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When you receive communications electronically from Edfinancial Services you are reducing paper waste, saving trees, and helping yourself stay clutter free.
E-correspondence Info
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- How do I opt-out of e-correspondence?
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You may opt out of e-correspondence at any time by contacting one of our Customer Service Representatives at 1-800-337-6884 or by web here. You will not be charged a fee for withdrawing your consent. Your withdrawal of consent is effective after you have contacted us and allowed us five business days to act upon your request. Your consent will remain effective until withdrawn in the manner indicated above.
E-correspondence Info
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- How can I obtain paper copies of e-correspondence?
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You may request a paper copy by contacting one of our Customer Service Representatives by phone at 1-800-337-6884.
E-correspondence Info
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- What are the hardware and software requirements for e-correspondence?
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While you may be able to access and save the e-correspondence using other hardware or software, your personal computer needs to support the following requirements:
- An operating system, such as:
- Windows 98, 2000, ME, XP, Vista or Win 7; or
- Macintosh OS 10.x
- Access to the Internet and an Internet browser which supports HTML 4.0 and 128bit SSL encryption and JavaScript, such as:
- For PC using Windows 98, 2000, ME, XP, Vista, or Win7
- Microsoft Internet Explorer 7.0 and higher
- Firefox 3 and higher
- Chrome 3.0 and higher
- For Macintosh using OS 10.x
- Safari 3.0 and higher
- Firefox 3 and higher
- Chrome 4.0 and higher
Most correspondence will be provided in either HTML and/or PDF format. For information provided in PDF format, Adobe Acrobat Reader 6.0 (or later versions) is required. You may obtain a free copy of Adobe Acrobat Reader from the Adobe website athttp://get.adobe.com/reader.
You may print correspondence if you have a printer connected to your computer and/or you may download and save a copy of the correspondence if you have sufficient hard-drive space.
E-correspondence Info
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- What are my legal rights concerning e-correspondence?
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We are required by law to provide certain information to you in writing; this means you have a right to receive that information on paper. We may provide this information to you electronically after you have reviewed the Disclosure and given consent to receive this information electronically. You may opt out of e-correspondence at any time by contacting us to withdraw your consent.
E-correspondence Info
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