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Student Banking

FAQs: Questions About Student Loan Repayment

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  • Hide Can I get a refund on my student loan if I don't complete the school term?

    Whether or not you complete your term, your student loan is still due. However, the federal government requires every school to have a refund policy. Before you enroll, you should know your school’s criteria for a refund and what the refund covers, for example tuition, fees and room and board. If you’re eligible for a refund, your school will send your refund to the holder of your loan, who applies it to reduce your outstanding loan balance.

  • Show What can I do if my family cannot pay its expected family contribution (EFC)?

    Your family may want to consider using other financing to make up the difference. This might include a PLUS loan for parents, an unsubsidized Stafford loan or a home equity loan or line of credit. For additional information about loan options, visit the student loans resources area of our website.

  • Show What can I do if I encounter an economic hardship that interferes with my ability to repay my loan?

    If you encounter problems repaying your loan, it's your responsibility to contact the holder or servicer of your loan immediately. There are several options available that may help. The most popular options are deferment and forbearance.

    A deferment is your legal right to suspend loan payments without cost or penalty, if you meet certain criteria. Interest on an unsubsidized loan will accrue unless you pay it when you are billed.

    A forbearance may let you postpone or reduce your payments for a specific length of time if you are willing, but temporarily unable, to meet your repayment obligation. You are still responsible for any unpaid interest that accrues during the forbearance period.

  • Show What can happen if I don't repay my federal student loan?

    If you default on your loan, the holder of your loan files a claim with the federal government to collect funds. After that, the Department of Education and the guaranty agency take charge. The government will notify all national credit reporting agencies and the loan default becomes part of your permanent credit history. The government will assign your loan to a collection agency.

    You still owe the entire unpaid amount of your loan, including interest, and it becomes due and payable immediately. The IRS may seize your property, garnish your wages, sue you and make you pay for court costs or deduct the loan amount from federal and state tax refunds—even state lottery winnings. You may also be ineligible for future educational aid.

  • Show What is the best way to avoid problems in repayment phase?

    First, know the name and contact information of your servicer so that you will be able to stay in touch should you have a problem. Know your rights and responsibilities as a borrower. Remember: When you take out a loan you also take out an obligation to repay the debt. If you have a problem repaying your loan, you have the right to discuss options such as deferment or forbearance to help you meet your obligation.

  • Show Does Bank of America offer student loans?

    Bank of America has suspended the origination of federal student loans and is no longer accepting new applications for Stafford, PLUS or Graduate PLUS loans. If you have any questions about obtaining a new student loan, please contact your school's financial aid office.

Information for Virginia

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