Glossary Repayment Options Change the monthly payment amount by changing the Repayment Plan. This repayment schedule is referred to as Level Repayment. However, we realize that in many cases, circumstances may make it difficult to make the standard payments and an alternative repayment schedule can make it easier for our borrowers to pay back their student loans. Unless you request an alternative repayment plan, your loan is automatically set up on a level repayment plan because it requires the least amount of interest to be repaid over the life of the loan. This plan will accrue more interest over the life of the loan because the principal decreases at a slower rate.
Payments then increase in year three to include both interest and principal.
Regular principal and interest payments then begin in year six. Similar to the graduated schedule, the payments are lower in the beginning and will increase later as your income increases. Your minimum monthly payment must at least cover interest charges. This option gives some relief based on limited earnings, but guarantees that the loan will not grow larger with each passing month. If you are interested in this option, please contact our office to receive an income sensitive worksheet and form for you to complete.