Student Financial Services
Student Financial Services

Financial Aid: Loans

Managing Your Loans
Prior to Repayment
During Repayment
Loan Consolidation
Loan Resources




You are responsible to pay your loan(s) according to the terms and conditions of the loan and to request assistance promptly.  Federal student loans offer many options to assist you during repayment. 

Credit Reporting

Postponing Payments
Know Who to Contact for Your Loans
Keep Your Contact Information Current
Perkins Loan Post-Deferment Grace Period
Cancellation and Deferment Options for Teachers
Perkins Loan Forgiveness (Cancellation)
Public Service Loan Forgiveness
Nursing Education Loan Repayment Program (NELRP)


Your loan is one of the first opportunities to establish good credit. Your student loans are reported to the national credit bureaus and updates will be reported monthly for the life of your loan. A favorable rating from these loans will put you in good standing when you need credit elsewhere. A bad rating will affect your financial opportunities for an extended period of time and remains on your credit report for seven years.   Periods of deferment and forbearance do not adversely affect your credit.

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It is important that you contact your loan servicer(s) immediately if you are unable to meet your repayment responsibilities.  Your servicer can provide information about the options available to assist you which may include deferment or forbearance.  If you have multiple loan servicer(s) any request for deferment or forbearance must be submitted to each of your loan servicers. 

Upon receipt of your request, your loan servicer(s) will review your eligibility and will notify you of the approval or denial. You are responsible to make your payments on time until you receive notification that your request has been approved or denied.

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Federal student loans provide a variety of deferment options including during periods when the borrower is enrolled at least half-time* and during periods of economic hardship and unemployment.  Your loan servicer(s) will provide information regarding eligibility criteria and forms to submit your request for deferment.  If you have multiple loan servicers you must submit any deferment request to each loan servicer. 

  • Direct Subsidized/Unsubsidized, FFEL Stafford, PLUS and Perkins loan: Deferment information is available online at and from your loan servicer(s).
  • Perkins and Nursing Loans awarded by Seattle Pacific University: Deferment information and forms to request deferment are available online at  Student Financial Services may also be contacted for assistance.

* Nursing and SPU Institutional loans have specific eligibility criteria for in-school deferment.   Contact Student Financial Services for assistance.

  • Nursing loans provide in-school deferment only if you are enrolled in an eligible nursing program. 
  • SPU Institutional loans provide in-school deferment only if you are enrolled at least half-time at SPU.

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Perkins Loan Post-deferment Grace Period

Perkins loans that have fully utilized the grace period provided after dropping to less than half-time, withdrawing or graduating will receive a post-deferment grace period of six months following an in-school, economic hardship, or any other type of deferment. This does not apply to forbearance.

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Forbearance may be requested if deferment is not available. Forbearance is approved at the discretion of the loan servicer; it is not an automatic benefit.  Interest accrues during any period of forbearance and may be paid during the forbearance period.

  • Direct Subsidized/Unsubsidized, FFEL Stafford, PLUS and alternative loan forbearance information is available from the loan servicer(s).

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Past due accounts may be accelerated at which time the entire balance of the loan including all principal, interest, late charges and fees are due in full. In addition, accelerated loans are no longer eligible for forbearance, deferment, and cancellation benefits.  Your loan servicer(s) can provide you with assistance to resolve a delinquent or defaulted loan. 

  • Perkins, Nursing and SPU Institutional loans are accelerated at 120 days past due.

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If you fail to make your payments as scheduled or do not promptly request deferment, late charges and fines may be assessed and the delinquency will be reported to the credit bureaus.
If you default, it means you failed to make payments on your student loan according to the terms of your promissory note, the binding legal document you signed at the time you took out your loan. In other words, you failed to make your loan payments as scheduled.  If your loan is in default status, it means that your loan has been delinquent for an extended period of time.  Your school, the financial institution that made or owns your loan, your loan guarantor, and the federal government can take action to recover the money you owe. Here are some consequences of default:

  • National credit bureaus will be notified of your default, which will harm your credit rating
  • You lose eligibility for additional federal (Title IV) student aid*
  • You may have funds withheld from your paycheck for repayment of your loan
  • State and federal income tax refunds may be withheld and applied toward the amount you owe
  • You may have to pay late fees and, if your loan is placed with an agency for collection, collection fees of at least 30% and up to 40% may be added to the entire loan balance. You will also be responsible to pay any court or legal fees that are incurred.
  • You may be sued

Additional federal loan default information:

*Eligibility for federal student aid may be restored by establishing satisfactory repayment arrangements and making six monthly payments over a six month period.   

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When an account has been referred to an agency for collection of a delinquent loan the borrower must make repayment arrangements with the agency and, as detailed in the promissory note, the borrower is responsible for the additional collection charges and legal fees associated with collection of the debt.

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Defaulted Direct Subsidized/Unsubsidized, FFEL Stafford, Perkins, PLUS and SPU Institutional loans are eligible for rehabilitation.  To rehabilitate a defaulted loan, you must enter into an agreement with the loan holder and make nine (9) on-time, monthly payments.  A loan may be rehabilitated only one time.
Advantages of rehabilitation include:

  • Your loan(s) will no longer be considered to be in a default status.
  • The default status reported by your loan holder to the national credit bureaus will be deleted.
  • You will be eligible for the same benefits that were available on the loans before the loans defaulted. This may include deferment, forbearance, and Title IV eligibility.

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Cancellation and Deferment Options for Teachers

Stafford and Perkins loans provide a cancellation benefit for teachers serving in a low-income or subject-matter shortage area.  Review the Cancellation/Deferment Options for Teachers page information at for more information.

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Perkins Loan Forgiveness (Cancellation)

Perkins loans provide cancellation provisions for full-time employment in a variety of service employment fields.  Information regarding eligible service employment and forms for Perkins loan cancellation benefits are available here

Deferment in anticipation of cancellation may be requested at the beginning of an eligible year of employment.  The borrower is responsible for submitting deferment and cancellation requests promptly to the loan servicer, Campus Partners.  Forms may also be submitted to Student Financial Services at SPU.  If not filed on time, eligibility for the benefits may be lost and late fees may be assessed.

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Public Service Loan Forgiveness
Under the Public Service Loan Forgiveness Program, if you are employed in a public service job, you may have the balance of your loans forgiven if you make 120 on-time monthly payments under certain repayment plans after October 1, 2007. You must be employed full-time in a public service job during the same period in which the qualifying payments are made and at the time that the cancellation is granted. The amount forgiven is the remaining outstanding balance of principal and accrued interest on eligible Direct Loans that are not in default. Review the Public Service Loan Forgiveness page at for additional details.

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NURSE Corps Loan Repayment Program
The U.S. Department of Health and Human Services provides the NURSE Corps Loan Repayment Program (NELRP) which is a competitive program that repays 60 percent of the qualifying loan balance of registered nurses selected for funding in exchange for 2 years of service at a critical shortage facility. Participants may be eligible to work a third year and receive an additional 25 percent of the qualifying loan balance.  Information about this program is available at

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Last Updated: 2/19/2015