MASSACHUSETTS EDUCATIONAL FINANCING AUTHORITY1

BEGINNING LOAN REPAYMENTWhat to expect

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First step: learn about your loans

•You may have both federal and private loans

•You may have loans from more than one lender

•Your college financial aid office can provide details on your loans

•Find out your loan servicer(s) (who you’ll pay) from your lender

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Federal vs. Private Loans

•Federal student loans–Student is solely responsible–Rates are always fixed –Offer various need-based repayment plans– Provide grad school deferment and economic hardship options

•Private loans–Most often the student needs a co-applicant–Applicants and co-applicants are equally responsible–Not federally insured: must be repaid per signed agreements– Limited ability for temporary relief assistance–MEFA is one example

Federal Student Loan Repayment

• StudentLoans.gov can provide details• Choice of Repayment Plans– Standard: Most cost effective: 10 years– Graduated: Useful if you expect a rise in income: pay less to begin– Extended: Lower monthly payment, longer to repay– Pay As You Earn Plan: Pay 10% of monthly income

• Other Options– Deferment: Postponement of loan payment– Forbearance: Temporary reduction or suspension of loan payment– Forgiveness– Consolidation: Combining loans into a single federal loan– Refinancing: Combining loans into a single private lender loan

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ACS

•MEFA’s loan servicer

•MEFA is still the holder of the loan

•Regular communication from ACS may include –Notification of grace period ending and first due date–Monthly bills or emails to the primary borrower–Missed payment notices– Phone calls to all parties on the loan–End-of-year tax information

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How To Pay Your MEFA Loans

•Check– Include payment stub or write account number(s) on check

•Phone payment at 800-397-8386•CheckMate II™ Automatic Debit •ExpressPay

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MEFA Loan Payments

•Applied first toward accrued interest, then principal•Due on the 28th of each month•No prepayment penalties•Anything extra goes toward principal, not next month’s payment•All payment notices and tax info are sent to the primary borrower – If a co-borrower would like to become the primary borrower, he/she

should contact ACS to request a primary borrower switch form

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The Importance of Credit

• If you miss payments it can affect your credit•Your credit can determine interest rates for future purchases•Employers can check your credit before hiring you•Landlords and rental companies may check your credit•All borrowers will be affected by missing a payment

How To Maintain Good Credit

• Avoid default!• Review your credit report annually• Keep good records• Pay your bills on time• Ask for help if you need it• Understand your credit score

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Strategies for Repayment

• Identify your goals – write them down• Identify all sources of income• Identify all bills – fixed, discretionary, and flexible•Look into refinance options•Contact your loan servicer if you cannot repay•Use CFPB’s Repay student debt guide to optimize repayment

Helpful Websites

mefa.org asa.org saltmoney.org studentaid.ed.gov consumerfinance.govirs.govconsumerfinance.govannualcreditreport.com creditkarma.com mint.com

Questions?

• Contact your loan servicer with questions on loan repayment

• MEFA loan borrowers can contact ACS:

ACS Loan Servicing501 Bleecker Street

Utica, NY 13501acs-education.com

(800) 397-8386