What if I Have Difficulty Making Payments?
If you currently have a loan and are having difficulty making your monthly payments, it is CRITICAL that you contact your lender immediately!! Remember your SCHOOL, LENDER/SERVICER, and GUARANTOR are your partners! They are ready and willing to assist you in meeting your obligation and reaching your career goals.
**If you cannot make a payment on your loan when it is due because of your financial situation, contact the holder of your loan immediately!
If you are a Baker College student and do not who your lender or servicer is, you can reach our Student Loan Advisors at 810-766-4285 or 810-766-4213 or toll free at 1-888-690-7912. You can also e-mail them at loans@baker.edu.
Deferments - A deferment is a way to postpone repayment on your loan(s) but you must meet the requirements for the specific deferment. See Deferment Section for possible deferment options.
Forbearance - An authorized period of time during which your lender agrees to temporarily postpone or reduce your principal repayment obligation. See Forbearance Section.
Repayment options - Several flexible repayment options are available to help you meet your repayment obligation. See Loan Repayment Options.
Consolidation - If you find yourself making monthly payments to multiple lenders or servicers, you may want to check into the loan consolidation program. See Loan Consolidation Information.
Loan forgiveness- You may be eligible for partial forgiveness of your student loans if you meet certain requirements. See Loan Forgiveness Section.
Loan cancellation - You may have your loan discharged if you meet the required guidelines. See Loan Cancellation Section.
REMEMBER …IT'S WHAT YOU DON'T KNOW THAT CAN HURT YOU, BUT WHAT YOU DO KNOW CAN SAVE YOU A LOT OF MONEY!
Be wise…don't risk defaulting on you student loan. Choose one of the alternatives available to you.
If you are a Baker College student you can also receive help from our Student Loan Advisors at 810-766-4285 or 810-766-4213 or toll free (888) 690-7912. You can also e-mail them at loans@baker.edu.
DEFERMENTS
To request any of the following deferment options, you would need to contact your lender or servicer by phone or if they have a web site you may be able to download the form(s) needed. Complete the required information on the form and return it to your lender or servicer for approval. On all Stafford Subsidized loans when deferment has been approved there is no additional interest charged during the deferment period so your student loan balance remains the same.
Continuing Study - If you are continuing full-time, part-time, graduate, internship, or residency study at an approved school, you may be eligible to defer the repayment of your loan. You must be attending at least 6 credit hours for undergraduate study and at least 4 credit hours for graduate study to qualify for in-school deferment. You would need to obtain an In-School Deferment Request form.
Unemployment - Allows you to defer repayment of student loans for a maximum cumulative period of 24 months, or 36 months if the disbursement was on or after July 1, 1993. You must be unemployed or working 30 hours or less a week and looking for full time employment. If you are collecting unemployment compensation you automatically qualify for this type of deferment and must provide a copy of your unemployment check along with the deferment form. If you qualify for this type of deferment you need to obtain an Unemployment Deferment Request form.
Economic Hardship - Allows you to defer repayment of student loans for a maximum cumulative period of 36 months if you meet specific guidelines for economic hardship. You need to obtain the deferment form to view the possible six different ways you could qualify for this deferment. You will need to obtain an Economic Hardship Deferment Request form.
Some other common types of deferments you could be eligible for are: Military, Public Health Service, Volunteer Service, Parental Leave, Working Mother, Temporary/Total Disability, Peace Corps, and/or Teacher Shortage.
You may be eligible for other deferments. Check with your lender/servicer for further details.
FORBEARANCE
Forbearance is possible by contacting your lender/servicer to make a forbearance arrangement. To apply, you must demonstrate that you are willing but unable to make payments because of financial hardship. You will need to obtain a General Forbearance Request form from your lender/servicer.
Forbearance is generally granted for up to 12-month intervals with a five (5) year maximum. After five years, circumstances are evaluated in granting additional forbearance time.
During forbearance a lender/servicer can (a) temporarily postpone a borrower's principal repayment obligation or (b) agree to accept smaller payments. Interest payments can be made or postponed. If postponed, the interest is capitalized and added to the principal.
LOAN FORGIVENESS
Loan Forgiveness is intended to encourage individuals to enter the teaching or childcare professions, or to perform national and community service. Under these programs, the U.S. Department of Education repays a portion of the guaranteed student loan obligation that was incurred by a borrower during the borrower's last two years of undergraduate education - if that borrower worked in those professions or performed that service.
LOAN CANCELLATIONS
Loan Cancellation is provided for borrowers who meet the specified requirements. Check with your lender/servicer or guarantor to get more detailed information. Some reasons a loan may be cancelled are:
Total and permanent disability - If a borrower becomes totally and permanently disabled, the loan may be discharged after their physician and the guarantor or US Department of Education approves the proper forms.
Closed school - A borrower may be eligible if he or she did not complete their training because the school is considered closed in compliance with federal regulations for a closed school designation, and they meet additional federal criteria.
Bankruptcy - Effective October 8, 1998, loans will not be eligible for loan discharge due to bankruptcy unless the court approves an undue hardship. Prior to October 8, 1998, a borrower's loans could be eligible for a discharge due to bankruptcy if the loans had been in repayment seven years or more, or less than seven years if the court approved an undue hardship.
False certification loan discharge - A borrower may qualify for a false certification loan discharge if the borrower - or student for whom a parent obtained a PLUS loan - received, on or after January 1, 1986, the proceeds of a FFELP loan disbursement to attend a school that:
1) Admitted the student on an "ability-to-benefit" basis for which the school was not qualified.
2) Forged the borrower's name on the application and/or promissory note without authorization.
3) Endorsed the borrower's name on the check or checked or signed the authorization for Electronic Fund Transfer (EFT) or Master Check without the borrower's endorsement.
Death - If a borrower dies on or after July 23, 1992, or the student for whom a parent received a PLUS loan dies, the obligation to make further payments is discharged.
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