Loan Repayment

May Graduates

If you borrowed federal student loans, you are required to complete an exit interview prior to graduation.  It is a federal financial aid requirement that you do so before you graduate. You will learn about the loan repayment process, schedules, federal loan consolidation options, deferments, grace periods and more.

You have a choice of 2 exit counseling options:

  1. To exit on-line, please see  Click on Complete Counseling and then choose Exit Counseling.
  2. Or, if you prefer to watch a video (to be viewed in our law library), you may do so during regular office hours (Monday & Thursday 9:00-6:00; Tuesday, Wednesday & Friday 9:00 - 4:30.  Please note that office hours are 9:00-4:30 Monday - Friday when classes are not in session).

Note: If you choose #2, it is still recommended that you complete the online option (#1) in order to see your individual federal loan data.

You are welcome to meet with us if you have any questions.  If so, please note that this will not count as exit counseling.  We request you complete exit counseling prior to making an appointment on this topic.

Bar Loans: The bar loan application (credit check required) suggested deadline is May 9. Bar loans are available to help cover bar exam costs, prep course fees and some living expenses while studying for the bar.  You may borrow from any private lender you wish that may offer a bar loan, but please review the terms and conditions of the loan carefully. Deadlines vary according to lender (credit check required). Although you may borrow from any lender you wish, this is a list of lenders our law students have used in the past who offer bar loans (availability of private loans by these lenders is subject to change):

Repayment Information

You will learn about the various loan repayment options during exit counseling. You are welcome to meet with us with any questions. These are the basic repayment plans (please see  for more detailed information on repayment):


  • 10 year fixed payment.

  • Higher payments than other plans but pay lower interest over life of loan.

  • Automatically enrolled in this plan at repayment, unless you cosse different plan.


  • Up to 25 years repayment.

  • Lower payments to start then increase every 2 years.

  • Total interest paid may be greater than plans with similar terms and fixed payments.


  • Up to 25 years fixed payment depending on loan debt volume.

  • Must have more than $30,000 loan debt.

Revised Pay As You Earn (REPAYE)

  • Payments based on 10% of discretionary income.

  • Payments calculated every year based on income (including spouse) and family size.

  • Must reapply every year to remain eligible.

  • Any remaining balance forgiven after 20 years for undergrad loans (25 years for loans taken during graduate/professional study) but is taxable.

  • Eligible plan for public service loan forgiveness.

Pay As You Earn (PAYE)

  • Payments based on 10% of discretionary income.

  • Payments calculated every year based on income (including spouse if filing jointly) and family size.

  • must reapply every year to remain eligible.

  • Any remaining blance forgiven after 20 years but is taxable.

  • Must have partial financial hardship.

  • Eligible plan for public service loan forgiveness.

Income Based (IBR)

  • Offer lower payments based on loan debt, adjusted gross income and family size.

  • Must reapply every year to remain eligible.

  • After 20-25 years (depending on repayment plan), remaining debt forgiven but is taxable.

  • See individual repayment plans for more details and requirements.

  • Eligible for public service loan forgiveness.

Income Contingent (ICR)

  • Offer lower payments based on loan debt, adjusted gross income and family size.

  • Must reapply every year to remain eligible.

  • After 25 years, remaining debt forgiven but is taxable.

  • Eligible for public service loan forgiveness.

Consolidation Information

There are some complex issues to think about regarding federal student loan consolidation.

Consolidation Interest Rate

Weighted average of all the federal loans you wish to consolidate rounded up to the nearest eighth of a percent.

May be a variable rate or fixed rate depending on when they were first disbursed:

  • Prior to 7/1/2006: variable rate, adjusted annually every July 1 (unless consolidated prior to 7/1/2007). 1

  • After 7/1/2006 and prior to 7/1/2013: fixed rate at 6.8% for the life of the loan

  • After 7/1/2013 is an annual fixed rate for life of loan. 2,3

Which Loans Can Be Included


Consolidate any variable rate loans separately?


Consolidate with other fixed rate loans based on the weighted average interest rate calculation?

  • It may be more advantageous to keep the low variable rate loan consolidated separately, but you may prefer to have only one consolidation loan with all your loans together.

Other Considerations

  • Wait until about 1-2 months before six month grace period ends before consolidating to lose the remainder of grace period (consolidation loans become due within 60 days after they are booked).

  • Most lenders, including Direct Loans, offer a .25% interest rate reduction for automatic electronic payment. This perk to lower your interest rate is strongly encouraged.

  • Remember, variable interest rate loans rates will change on July 1 every year unless you consolidate. There will be an additional .6% added to the rate after the 6 month grace period ends; the repayment rate will be based on that higher rate if you do not consolidate.

  • As of July 1, 2013 there is no cap on the consolidation rate and is then fixed for the life of the loan (10 - 30 years depending upon your debt load).

1. Based on the 91 Day Treasury Bill (as of the last auction prior to June 1) plus 1.7% during in school and grace period, or plus 2.3% in repayment, not to exceed 8.25%.

2. The rate is determined by adding the 10-year Treasury bill + federally set spread percent.

3. For graduate/professional students, the spread is 3.60% for Unsubsidized loans and 4.60% for Graduate PLUS loans.

Direct Loan Consolidation Considerations

  • Direct Loans are eligible for public interest loan forgiveness after 120 on-time payments in eligible public interest work.
  • Direct Loans are eligible for REPAYE loan forgiveness after 25 years for graduate/professional loans (20 years for undergraduate loans), Pay As You Earn (PAYE) loan forgiveness after 20 years, Income Based Repayment (IBR), or Income Contingent (ICR) loan forgiveness after 25 years.  At this time any balance forgiven is taxable except under Federal Public Interest Loan Forgiveness.
  • If you consolidate with Direct Loans and need a deferment, any subsidized portion of your loan will not accrue interest.
  • You will retain the repayment incentive you received at disbursement after 12 on-time payments for loans disbursed prior to July 1, 2012.
  • All your law school federal Stafford loans are through Direct Lending so the application process is simple.

For more information and to apply for a Direct Loan consolidation, please see or call 800.557.7392.

Other Consolidation Lenders

  • Some private lenders offer repayment incentives in addition to the .25% automatic debit reduction that are attractive, such as a 1% interest rate discount after 20 to 48 month on-time payments or a 5% principle reduction, depending on the lender. These incentives are lost if payments are late and the benefit may be revoked under certain deferment situations.  These days most of these lenders have eliminated these incentives and many lenders who used to offer consolidation no longer do so.
  • If you consolidate with a private lender, the Direct Loan origination fee rebate you received at disbursement (prior to July 1, 2012) will be added back in to your loan balance.

August and December Graduates

The basic information for May graduates applies to your situation as well. You will receive exit counseling information at the time of your graduation. Please let us know if you have any questions regarding your situation.

Recent College Graduates

  • If you are no longer enrolled in school, you may consolidate through Direct Lending or through another lender in the FFEL program.
  • If you did not consolidate previously, you may consolidate during your grace period or during repayment. Your loan will come due within 60 days after it is booked.
  • Student loans may be deferred while enrolled at least half-time.
  • If interested in the public interest forgiveness programs, you should consolidate with Direct Loans and may do so for the purposes of loan forgiveness.

In General

Eligible Loans

  • Federal student loans include Stafford, Perkins, Grad PLUS, PLUS and SLS.
  • You may consolidate undergraduate federal loans with your law school federal loans.
  • If interested in the public interest or PAYE, REPAYE, or IBR forgiveness plans, do not include a parent PLUS in the consolidation (Grad PLUS is fine) or the loan will not be eligible.

Perkins Loans

  • You may wish to consolidate for the convenience factor but consider carefully whether or not it outweighs the fixed 5% interest rate. Depending upon the weighted average, it may or may not alter the consolidated fixed interest rate.
  • There are some cancellation options related to the Perkins loan that may benefit you if you qualify (see ). If you consolidate you will lose these cancellation benefits.
  • You will pay more interest over the life of the loan if you consolidate the Perkins loan because the repayment period is 10 years and consolidation will extend this timeframe.
  • If you consolidate through lenders other than Direct Loans, the subsidized interest benefit for periods of deferment will no longer exist.
  • Depending upon when you consolidate, you may lose most of the 9 month grace period. You have 180 days in which to add another loan to your consolidation loan.


  • May be consolidated with your Stafford loans and eligible for public interest loan forgiveness (private loans are not).
  • The interest rate is higher than the Stafford Loans. Consolidation will most likely reduce the Grad PLUS rate somewhat but raise the overall Stafford rate. Amount dependent upon the weighted average – see Calculators below.
  • Note: A parent PLUS loan that is consolidated or paid off by consolidation would make all loans within that consolidation ineligible for the PAYE, IBR plan, and federal loan forgiveness. If interested in PAYE, REPAYE, or IBR loan forgiveness, do not consolidate a parent PLUS loan. A Grad PLUS is eligible.

Private Loans

  • If you have private (credit based) student loans, you cannot consolidate your private loans with your federal loans, but you may list them for total student loan indebtedness purposes – it will extend your repayment period.
  • Although you cannot consolidate private loans (Sallie Mae, Chase, Citibank, Discover, etc.) with your federal loans, there are some organizations out there encouraging you to do so. We strongly advise against this because it will convert your federal loans into a commercial loan and you will lose the federal deferment and forbearance options and federal tax benefits.
  • If you want to consolidate your private loans from different lenders together after graduation, you may do so.  Consolidating your private loans together may not fix the interest rate (if a fixed rate is offered, it is typically fairly high); it simply provides a consolidation of two or more separate lender bills into a single lender statement.
  • Along with a credit check, you may end up paying origination fees and more interest or lose some deferment options that may be offered by specific private lenders. But you may be able to find a better variable interest rate and improved repayment options.


For repayment calculators:

Loan Repayment Assistance

More Info on Pay As You Earn (PAYE), REPAYE, Income Based Repayment (IBR) and the Federal Public Interest Loan Forgiveness Programs

  • This site by Heather Jarvis, Student Loan Expert (formerly of Equal Justice Works), is a great resource on these topics. 

Federal Public Interest Loan Forgiveness documents are now available!

Alumni working in this area should note it's important to keep track of your on-time and eligible payments (in the right repayment plan) and eligible employment for 120 payments. The forms may be found at  or


Please contact Student Financial Services at 206.398.4250 or should you have any questions.