Borrower Rights and Responsibilities

When you borrow a Federal student loan you have many rights as well as some responsibilities. Here's what you need to know:

Your Rights

• You must be provided with a copy of your Master Promissory Note (MPN), which explains the terms and conditions of your loan.


• You must be provided with the following information: the amount of your loan and its interest rate, the date you must begin repaying your loan, any fees you must pay and how these fees are charged, the annual and aggregate maximum loan amounts you can borrow, your minimum monthly payment amount and maximum years you can take to repay your loan.


• Before you begin repaying your loan, you must be provided with a payment schedule, a description of all repayment plans and how to avoid default, any loan repayment benefits offered by lender and a projection of interest to be paid.


• You have the right to defer your loan payments or request payment forbearance when you qualify.


• You have the right to pay your loan off early without penalty.


• New! Beginning July 1, 2009, you must be provided a bill or statement for each payment installment period which includes detailed loan updates regarding your balance, interest, fees assessed and option to change repayment plans
  

Note: Servicers will provide these statements and disclosures on behalf of the lender. If you are not receiving these statements and disclosures, you should contact your lender.

Your Responsibilities

• You are responsible to repay your loan on time in accordance with the terms on your promissory note. Otherwise, you might go into default, which has serious consequences and could negatively impact your credit rating.


• You must make monthly payments in full - even if you don't receive a bill. Partial payments do not fulfill your repayment obligation.


• If you apply for a deferment or forbearance, you must continue to make payments until you receive confirmation that you have been granted a deferment or forbearance.


• You must notify your loan servicer when you: graduate, leave school or transfer to another school; drop below half-time status; change your name, address, or Social Security Number.


• If you are borrowing a Stafford loan for the first time you must complete student loan entrance counseling.


• You must complete student loan exit counseling before you leave school.

Note: Even if students don't finish their education, aren't satisfied with the education they received or don't get a job, student loans must be repaid. Keep in mind, Student Lending Works can help you with flexible repayment options.