If you graduated this spring or summer, your student loan grace period is counting down. For many borrowers, the first payment will arrive in the fall—and being prepared makes the transition from student to repayor smoother.
What Is a Grace Period?
A grace period is the window of time after you leave school, graduate, or drop below half-time enrollment before your loan payments begin. Federal Direct Loans typically provide a six-month grace period. This means if you graduated in May 2026, your first payment would likely be due around November 2026.
Private student loan grace periods vary by lender1. Some offer six months, others offer less, and some require payments to begin while you are still enrolled. Check your loan agreement or contact your lender to confirm your specific timeline.
During the grace period for unsubsidized federal loans and most private loans, interest continues to accrue. Any unpaid interest may capitalize—meaning it gets added to your principal balance—when repayment begins, increasing the total amount you owe.
Find Out Who Your Loan Servicer Is
Your loan servicer is the company that manages your loan account, processes payments, and helps you navigate repayment options. For federal loans, you can find your servicer by logging in to studentaid.gov.
For private loans, your servicer is typically the lender or a third-party company designated by the lender. Check your loan documents or any correspondence you have received.
Make sure your servicer has your current contact information—mailing address, email, and phone number—so you receive billing statements and important notices.
Know Your Loans
Before repayment begins, compile a complete picture of what you owe:
- Loan types: Subsidized, unsubsidized, PLUS, private
- Current balances: Including any capitalized interest
- Interest rates: Fixed or variable, and the specific rate for each loan
- Loan servicer(s): You may have more than one
- Monthly payment estimates: Available through your servicer or loan calculator tools
Having this information in one place makes it easier to choose a repayment strategy and budget for monthly payments.
Choose a Federal Repayment Plan
Federal loan borrowers are automatically placed on the Standard Repayment Plan, which features fixed monthly payments over 10 years. This plan results in the least interest paid over time, but the monthly payments may be higher than some borrowers can afford early in their careers.
Other federal repayment options include:
- Graduated Repayment: Payments start lower and increase every two years. Still a 10-year term, but more front-loaded flexibility
- Extended Repayment: Stretches payments over up to 25 years, lowering the monthly amount but increasing total interest
- Income-Driven Repayment (IDR) plans: Monthly payments are based on your income and family size, with potential forgiveness after 20-25 years of qualifying payments
If you are pursuing Public Service Loan Forgiveness (PSLF), an IDR plan is typically required. For a detailed overview of each option, see Choosing a Student Loan Repayment Plan.
Set Up Autopay
Many loan servicers offer a small interest rate reduction (often 0.25%) for enrolling in automatic payments. Beyond the rate benefit, autopay eliminates the risk of missing a payment due to oversight, which protects your credit.
Confirm that your bank account is linked and that the payment date aligns with your pay schedule.
Consider Making Interest Payments During the Grace Period
If your budget allows, making interest-only payments during the grace period prevents capitalization. Even small payments during this time can reduce the total cost of your loan—our guide on in-school repayment covers this strategy in detail. This is especially relevant for unsubsidized loans where interest has been accruing since disbursement.
Know Your Options If You Cannot Afford Payments
If your financial situation makes it difficult to start payments on schedule, you have options:
- Income-driven repayment can lower your federal loan payments significantly if your income qualifies.
- Deferment or forbearance allows you to temporarily pause payments, though interest may continue to accrue.
- Contact your servicer early. Reaching out before you miss a payment gives you access to the full range of options. Waiting until you are already behind limits your choices and may affect your credit
1Subject to credit qualification and additional criteria, including attending an approved school. Savings or lower interest rates are not guaranteed and depend on your individual financial profile, loan terms, and credit history.
