Loan Repayment

Overview: Loan Repayment

Receipt of an educational student loan is a serious obligation. You are required to complete an Entrance Interview and sign a Master Promissory Note in order to receive your loan funds. It is extremely important that you understand your rights and responsibilities as stated on the Promissory Note.

Repayment begins after you graduate, drop below half time status, withdraw, or do not plan to return to UHM for the next semester. Depending on the type of loan, the grace period for repayment will differ.

If you re-enroll at least half time at UHM or any other institution, enter into certain areas of service, become ill or unemployed, you may be able to defer your payments by notifying your lender and completing a deferment form.

You may prepay at any time without penalty and decrease the interest, but if you fail to make any loan payment as agreed or fail to submit the proper deferment or cancellation form, the total loan may become due and payable immediately, and legal action could be taken against you.

For more information on the different repayment plans and how to calculate your monthly payments, go to Repayment Plans external-link icon.

Loan Consolidation

When you begin repayment on your student loans, you may consider consolidating your loans. Consolidation allows you to pay off some or all of your existing student loans by combining them into a single, large loan. There are two types of consolidation programs for education loans:

  • Federal Consolidation Loans
    • Fixed interest rate based on a weighted average of the current rates on your existing loans
    • Deferment options predetermined by federal regulations
    • Non-federal (private) loan funds is not included in consolidation
  • Private Consolidation Loans
    • Can include both federal and non-federal student loan funds
    • Usually a variable interest rate
    • Forbearances available only at the lender's discretion

Any consolidation loan is likely to significantly increase the total amount of interest that you will be required to pay. If you are able to meet your current monthly repayment obligations, it may be best for you to avoid consolidation.

Loan Forgiveness

If you teach elementary or secondary school you may be eligible for special deferment options and, in some cases, cancellation of a portion of your student loan debt. Eligibility requirements are available at the Department of Education external-link icon.

  • For Federal Stafford loan deferment or cancellation, contact your lender for application forms.
  • For Federal Perkins loan deferment or cancellation, contact the school where you borrowed your loan; or the school's Perkins servicing agency.

FSA Student Loan Ombudsman

The Federal Student Aid Ombudsman of the U.S. Department of Education helps resolve disputes related to federal student loans.

  • Contact information for the FSA Student Loan Ombudsman's Office
    • Via on-line Assistance: external-link icon
    • Via Telephone: 877-557-2575 (toll free)
    • Via Fax: 202-275-0549
    • Via Mail:
      • U.S. Department of Education
      • FSA Ombudsman Group
      • 830 First Street, N.E., Mail Stop 5144
      • Washington, DC 20202-5144

Defaulting on Student Loans

If you cannot make a loan payment, contact your lender immediately to make arrangements. Failure to contact your lender will result in your loan going into a default status. If you default on your loan payment, you will be penalized. Future Financial Aid requests will be denied until your loan default status is cleared with the U.S. Department of Education. Student loan borrowers in default do have options to repay their loans. Information is available from the Department of Education Debt Resolution page external-link icon and external-link icon.