Thursday, September 13, 2012



Beautiful leaves falling, crisp cooler days, and thoughts of school….. Fall is the season that inspires many of us to return to school to continue our education.

Whether you are finishing your first degree or returning to pursue an advanced degree, please make sure your current student loans are placed back into an in-school deferment.

Although the actual forms must be submitted by the school you are attending, as the borrower, it is your responsibility to make sure the forms have been submitted by the school and processed by your current servicer. Too often the forms are either not submitted or not processed by the servicer.

As a result the loans become delinquent and the march toward default begins. I see this all of the time – borrowers who have been attending classes, signing new financial aid forms, thinking they are doing the correct things; however, they ignore those pesky late notes and e-mails from their servicer - assuming  that they keep getting them " in error” and then one day, BAM! Their accounts are in default, financial aid funds and pell grants are cut off!

Don’t let this happen to you.

If you have recently returned to school take a moment and a few simple steps to ensure your student loan accounts are in their correct status:

1. Call your servicer or sign in to your on-line account to verify the current status of all of your student loans. (Don't know who your servicer is?  Visit to locate your student loans)

2. Make sure all previous student loans are in a deferment, as opposed to forbearance. What’s the big deal? If your loans are in forbearance, all of the loans will accrue interest.  In a deferment, the interest will only accrue on your unsubsidized loans; it will not accrue on your subsidized loans. Believe me, this can really add up over the life of a loan.

3. If the loans are not in a deferment, immediately contact or visit your school’s financial aid office.  Have the in-school deferment completed while you are there – you should sign the form. Ask for a copy of the completed form for your records.

4. In order to verify the situation has been corrected, repeat steps 1, 2 and, if necessary, step 3.

5. Stay enrolled ½ time or greater until you complete your next education step!  You will not have to worry about this process again!

OK – with that off of your mind, it is time to hit the books!