What if the payments are too high on my federal and private student loans?
You’re not alone if you’re struggling to make payments. You have options to improve your situation, but it's important to act quickly.
First, talk to your servicers about lowering your payments
Your options will vary depending on whether your loan is federal or private, and other details of the loan agreement.
Federal student loans: Federal loans offer a variety of income-driven repayment (IDR) plans that base your payment on your income and household size. You could pay as little as $0 per month. Use the Education Department’s Loan Simulator to choose the right plan for you.
Once you're on an IDR plan, stay on track with our tips for managing IDR plans.
Private student loans: When you ask your lender for relief, it may help to show what you can pay. Organize your evidence, including bank statements and other bills. A careful budget may help you make your case for lower payments. Private student loan lenders are not required to offer you any relief, so you may need to show proof. Responsible lenders will want to work with you to help you stay out of default.
Then contact your servicer to ask if they offer options for reducing your payment. You may find it less stressful to make the request by letter or email. Here’s a sample letter requesting a lower payment that you can adapt to your situation. (You can also use it as a script if you decide to use the phone.)
Know what you’re signing up for
If your servicer can offer you relief, you’ll want to make sure you understand the potential consequences. Here are some questions to ask your servicer:
- Will I be charged any sign-up fees? Is any paperwork required?
- When will this start? Do I need to make my next payment?
- How long will this last? If I still can’t afford my payments when this relief ends, can I request an extension?
- How much extra interest will this cost me in the long run?
If your servicer is only offering to pause or postpone payments, also known as forbearance, then you may want more information:
- Will interest continue to accrue during the forbearance?
- Will interest be capitalized when the forbearance ends? (Capitalization adds the interest to the principal balance, meaning you will pay interest on interest.)
- How will the missed payments be made up? Will my monthly payment go up or will I keep making payments beyond my original payoff date?
If you have a co-signer, let them know you're struggling
If a parent or other family member is on your loan, let them know if you are in danger of missing payments. Any missed payments could hurt their credit, too.
Next, avoid risks and wasting money
- If you need more help, don’t pay for it. There are many ways to get free assistance with figuring out your loans.
- Don’t use other debt, like credit cards or home equity, to pay off student loans.
- Only go back to school if it will pay off.
- Find out more about these and other ways you can avoid scams and wasting money.
Explore other situations
- See tips to pay off your student debt faster
- If you're in the military or work for a government or nonprofit organization, learn about public service loan forgiveness
- Have another type of loan? Review options again for more advice
