What Is Direct Loan Exit Counseling?

Exit counseling is designed to assist you in understanding your rights and duties as a borrower of federal direct subsidized and/or unsubsidized loans from the Department of Education. Among the topics covered in the online session are how to handle student loans, repayment plans and choices, debt management, the implications of defaulting on student loans, and other topics.

When you quit school or drop below half-time attendance, you must complete exit counseling as a condition of graduation. The goal of exit counseling is to ensure that you understand your student loan commitments and that you are prepared to make your loan payments when you graduate. You’ll gain an understanding of what your federal student loan payments will look like following graduation.

What is federal student loan exit counseling?

Federal student loan exit counseling explains your repayment alternatives, rights, and duties, and it is needed for all borrowers who have taken out federal student loans, such as Direct or PLUS loans, in order to graduate. Continue reading to find out how to provide exit counseling for student debt as you prepare to leave college behind.

How do I get financial aid for exit counseling?

You can conduct exit counseling online by connecting into your Federal Student Aid (FSA) account on the Federal Student Aid (FSA) website. Some schools, on the other hand, provide in-person departure counseling services. Find out what financial assistance options are available to you by contacting the financial aid office at your school.

What happens after completing exit counseling?

As soon as you’ve finished filling out your information, your student loan exit counseling is complete. As soon as your loan servicer has approved your repayment plan, you will be able to begin making payments on your loan on the first due date.

What is an exit loan?

What is Student Loan Exit Counseling and how does it work? Student loan exit counseling is an online course given by the United States Department of Education through StudentLoans.gov that guides students through the process of repaying the federal student loans they took out to pay for their education.

What happens if I dont do loan exit counseling?

Federal law mandates that all employees get exit counseling. Depending on your school, you may face consequences if you do not finish it. Typically, the Bursar’s office will place a hold on your transcripts and diploma until you have completed your departure counseling. In most cases, you will be able to complete your degree.

Who should complete exit counseling?

Those who have received loans through the William D.Ford Federal Direct Loan (Direct Loan) Program or through the Federal Family Education Loan (FFEL) Program and have dropped below half-time enrollment, graduated, or left school must complete exit counseling each time they drop below half-time enrollment, graduate, or leave school, regardless of whether the loans were subsidized, unsubsidized, or PLUS loans.

What is a loan exit interview?

An exit interview is a loan counseling session during which you will be informed about your loan repayment schedule, duties, and rights to deferral and/or cancellation, among other information. In order to comply with federal regulations, your school is obligated to perform an exit interview if you are no longer enrolled as at least a half-time student.

How long is the grace period for direct loans?

Loans and the Time Allotted to Repay Them Direct Subsidized Loans and Direct Unsubsidized Loans both have a six-month grace period before payments are due before they are considered late.

How many days after your scheduled payment is due will your loan go into default if not paid?

Understanding the Concept of Default If you don’t make your regular student loan payments for a period of at least 270 days on a loan obtained under the William D. Ford Federal Direct Loan Program or the Federal Family Education Loan Program, you are deemed to be in default on your loan.

Does interest still accrue during forbearance?

In the majority of circumstances, interest will accumulate during the time of deferral or forbearance you have requested (except in the case of certain forbearances, such as the one offered as a result of the COVID-19 emergency). This implies that your loan balance will rise, and you will have to pay more interest throughout the course of the loan.

How long is the grace period for direct loans and FFEL?

Each loan will have a six-month grace period before you are required to return it. This grace period will begin the day after you cease to be enrolled in school at least half-time.

Do I have to complete exit counseling if I attend graduate school?

All borrowers of federal student loans are obliged to participate in exit counseling. After receiving a direct loan under the Direct Loan Program (whether subsidized, unsubsidized, or a PLUS loan), borrowers must complete exit counseling if they reduce their enrollment to less than half-time, drop out of school, or graduate.

Do I have to do loan entrance counseling every year?

As long as you are borrowing loans, your MPN is valid for 10 years after it is placed on file. Once placed on file, entry counseling has no expiry date. You are not obligated to do them on an annual basis, however you are more than welcome to do so if you like. More information regarding entrance counseling and MPN may be found by visiting the following sources.

How do I close my student loan account?

There are two different methods for removing closed student loans from your credit report: 1. request that the creditor remove the account from their reporting system; or 2. file a dispute with one of the three main credit bureaus. Having favorable installment loans on your credit report, even if they are paid off, is beneficial to your credit score.