Rutgers Health Students
Find more resources and information about managing your finances after graduation.
Preparing to Enter Repayment on Your Loans
As you prepare for the transition from Rutgers into your career, you will be working with your loan servicer(s) in repayment. Be sure that your address and contact information is up to date and pay special attention to any correspondence from loan servicers.
What Happens When You Graduate
Grace Periods
When you graduate, your loan servicer(s) is notified that you are no longer in school and you automatically enter any grace or similar period(s) you have on your student loans.
Different loans may have different grace periods, so loans may enter repayment at different times
- Stafford Loans have a 6 month grace period
- Perkins Loans have a 9 month grace period
Some loans do not have grace periods and may come due immediately upon graduation. Inquire with your loan servicer for details.
Grace periods are “loan specific,” so if you used up a grace period on any loans you had before starting school, those grace periods are gone and those loans will come due when you graduate, six months earlier than some others.
Entering Repayment
Approximately 30-45 days prior to the expiration of your grace period, watch for a notice from your loan servicer that your loan is about to enter repayment. Be sure your loan servicer(s) has your current address and that you know what graduation date is reported for you at Rutgers.
Notice from loan servicer(s) should reference several options, such as choosing a repayment plan and actively repaying your student loans, or choosing to postpone your payments through deferment or forbearance.
Inceptia
Rutgers University has partnered with Inceptia to help simplify the loan repayment process. Borrowers can expect to hear from Inceptia regarding their situation throughout their enrollment time and also upon separation from enrollment at Rutgers.
Inceptia, a division of the National Student Loan Program (NSLP), is a nonprofit organization providing leadership and innovation in higher education access, verification, student loan repayment, default prevention, financial education, and more. Inceptia is working with schools to create a world where students are less burdened by the anxiety of student loan debt. Where financial aid offices are freed from time-consuming processes and tasks that pull them away from helping students. And where default rates continue to fall even as loan amounts increase.
At Inceptia, it is their mission to support schools as they arm students with the knowledge needed to become financially responsible citizens – without accumulating the burden of debt and default. Inceptia provides the confidence and proven solutions you and your school can count on – helping ensure a brighter financial future for your students.
Loan Repayment Options
The repayment options listed below are for loans taken out through the William D. Ford Federal Direct Loan Program. While there are some restrictions, students may switch repayment plans if needed. Students should contact their loan servicer(s) if they have questions about changing repayment plans.
Repayment Assistance Plan (RAP) - NEW
RAP is a newly created income-based repayment plan. Some important details about this new plan are as follows:
- If married, filiing separately, the spouse’s AGI and number of dependents are not included in the payment calculation.
- Monthly payment is 1-10% of income based on AGI ($10 minimum payment applies).
- $50 off monthly base payment per dependent.
- 30 year repayment period.
- No negative amortization.
- No cap on monthly payment, even if it’s higher than the standard repayment plan would be.
- If a borrower makes an on-time payment that reduces thier principal by less than $50, the U.S. Department of Education will make a payment to the principal, up to the amount paid, minus what was applied to the principal, or $50, whichever is less.
Tiered Standard Repayment Plan - NEW
A new tiered standard plan has been created with 4 fixed terms of 10, 15, 20, or 25 years, based on the total amount borrowed (or total outstanding balance if already in repayment).
Income Based Repayment (IBR) Plan - CURRENT
Important information about changes to the current IBR plan are as follows:
- Requirement for borrowers to demonstrate a partial financial hardship has been removed.
- Allows for covered income contigent loans to be repaid under IBR.
Repayment Options for CURRENT student borrowers
Current borrowers with no new loans made on or after July 1, 2026, are eligible to enroll in the current Standard, Graduated, Extended or current IBR repayment plans. They can also enroll in the new RAP.
Until July 1, 2028, current borrowers may also switch between, enter, or remain on existing Income-Driven Repayment (IDR) plans, such as Income-Contingent Repayment (ICR), Pay As You Earn (PAYE), and Saving on a Valuable Education (SAVE). Current borrowers enrolled in these plans must transition to a different repayment plan (IBR, Standard, RAP) by July 1, 2028.* If no selection is made by that date, they will be automatically moved into RAP.
*Eligible borrowers must enroll in PAYE by July 1, 2027 due to actions related to the Saving on a Valuable Education (SAVE) plan litigation. This action is separate from OBBBA repayment changes. Borrowers enrolled before July 1, 2027 may remain in PAYE through July 1, 2028
Repayment Options for new student borrowers
New loans made on or after July 1, 2026, can be repaid only under the new tiered standard repayment plan or the new RAP. All new Parent PLUS loans made on or after July 1, 2026, must be repaid under the new tiered standard program, as these loans are not eligible for RAP. If a borrower with new loans made on or after July 1, 2026, does not select a plan, they will be automatically assigned to the new standard repayment plan.
All loans must be paid under the same repayment plan. This means that borrowers with loans made before July 1, 2026, who take out additional loans on or after July 1, 2026, will only be able to choose from the new tiered standard plan or RAP.
Repayment Options for Consolidation & Parent PLUS Loans
Information about consolidation loan changes is as follows:
- Consolidation loans made on or after July 1, 2026 are only eligible for the new tiered standard repayment plan or RAP.
- Until July 1, 2028, borrowers with consolidation loans (subsidized or unsubsidized) taken out before July 1, 2026, may also switch between, enter, or remain on existing Income-Driven Repayment (IDR) plans, such as Income-Contingent Repayment (ICR), Pay As You Earn (PAYE), and Saving on a Valuable Education (SAVE). Current borrowers enrolled in these plans must transition to a different repayment plan (IBR, Standard, RAP) by July 1, 2028. If no selection is made by that date, they will be automatically moved into RAP.
- If a consolidation loan was used to pay off a Parent PLUS loan, it must enter repayment under ICR before July 1, 2028 to become eligible for Income-Based Repayment (IBR). If the borrower takes no action by that date, all eligible loans will be automatically moved to RAP and any loans not eligible for RAP will be placed into IBR.
Information about Parent PLUS changes is as follows:
- All new Parent PLUS loans made on or after July 1, 2026 are not eligible for RAP. They must be paid under the standard repayment plan.
- All Parent PLUS loans must be paid under the same repayment plan. This means that borrowers with Parent PLUS loans made before July 1, 2026 who take out additional loans from the program on or after July 1, 2026, will only be able to choose the new standard plan.
Loan Rehabilitation Terms
As of July 1, 2027, borrowers can rehabilitate a defaulted loan twice instead of once as is currently allowed. Rehabilitating a loan involves working with the loan servicer to bring the loan back to good standing by making a series of agreed-upon monthly payments. The minimum rehab payment for Direct Loans will be $10.
Loan Deferment
As of July 1, 2027, Economic Hardship and Unemployment deferments will no longer be available for new loans. Borrowers with loans made on or before July 1, 2027 can still use these deferment options under the current rules.
Loan Forbearance
Loans made on or after July 1, 2027 are eligible for forbearance for up to nine months in any two-year period. This is a change from the current rules which allow for a forbearance up to 12 months in a three-year period.
Direct Loan Consolidation (Optional)
Consolidation is a process whereby you pay off or refinance multiple loans with one new loan. There are both advantages and disadvantages to consolidation, and while it is an effective debt management tool for some graduates, it is not appropriate for everyone.
Quick facts about consolidation:
- The interest rate on consolidation loans is a weighted average of all loans being consolidated, rounded up an eighth of a percent (.125%) then fixed for life of loan.
- Consolidation pays off your outstanding loans with your current lenders.
- The Federal Direct Consolidation Loan online application available at studentaid.gov.
- More direct loan consolidation information is available on studentaid.gov. If you have questions about consolidating your federal education loans before you apply, you can also contact the Loan Consolidation Information Call Center at 1-800-557-7392.
Postponing Payments
There are two ways to postpone payments on federal loans: deferment and forbearance
Check promissory notes and disclosure statements for postponement options on non- federal loans including private and institutional loans.
Quick facts regarding deferment and forbearance:
- Subsidized loans remain interest free during deferment
- Interest accrues on all loans during forbearance
- Borrowers remain in “good standing” during both deferment and forbearance
- Borrowers must meet specific statutory requirements for deferment eligibility
- There are multiple kinds of forbearance and loan servicers have some discretion granting forbearance
- Borrowers must submit multiple requests if they have more than one loan servicer