New Grad? This 6-Step Guide Will Help You Determine What You Owe in Loans

If you’re a recent graduate, the last thing you want to think about is the past, right? It’s all about the future.

However, if you took out student loans, the time to look back is now (actually, it probably should have been sooner, but let’s not quibble over semantics).

If you’re like most grads, you took out multiple student loans over your four(ish)-year career as a college student — consumers with educational debt had an average of 3.7 student loans, according to a 2017 Experian report. 

Unfortunately, 11.4% of aggregate student debt was 90 or more days delinquent or in default in the fourth quarter of 2018, according to the Federal Reserve. That means there are a lot of people not paying their student loans on time — or perhaps at all.

But you won’t be one of them, right?

You just need a little help figuring out who you owe… and how much… and when it’s due.

Oh, and how long before these loans are paid off and out of your life (spoiler alert: you might get a temporary reprieve on payments if your loan has a grace period).

Fortunately, you have The Penny Hoarder to help you organize your student loan debt in way to pay it off in a timely, cost-effective way so you can get back to that future thinking.

How Much Do I Owe in Student Loans?

It would be nice if you could put a simple, smallish figure down on paper and be done.

But student loans can get complicated, and you should have all the essential information before you formulate a plan of attack for paying them off.

We’ve come up with the list of questions you should be able to answer about both your federal and private student loans to truly know how much you owe. That could mean a few trips to the interwebs, a close reading of your loan agreement and/or a call to your lender. Let’s get started.

1. Who Is My Student Loan Servicer?

Two happy female graduates hug each other.

Getty Images

There’s no sense in knowing how much you owe if you don’t know who you owe it to, right?

Federal Student Loans 

Dig out your FAFSA (Free Application for Federal Student Aid) login and password to sign onto Here you will find a list with your federal student loans. 

Each entry will also indicate the company hired by the federal government to service the loan — look for names like Navient, Great Lakes or FedLoan, three commonly used loan servicers. Any further interaction in regards to your loan should go through your loan servicer.

If you need more info about your loans  — such as when your loan was disbursed — log into the National Student Loan Data System ( 

“Use that same federal student aid login and password to login,” said Heather Jarvis, a North Carolina attorney who specializes in student loans. “That site is much less formatted and is less easy to read than, but it does have more information.”

Private Student Loans

Private student loans are more difficult to track — especially if you accepted them without much thought as a 17-year-old … and you lost any paperwork four moves ago … and your loan’s been sold. 

If you’re at a total loss for who to contact, start with your alma mater. 

“The college admissions office is going to know who paid the tuition,” said Melinda Opperman, executive vice president of She recommended asking for a duplicate copy of the loan agreement, which the college should have in its records. 

“If they can’t provide that, at least [ask for] the phone numbers of who to get in touch with,” Opperman said.

No luck with your college? There’s one more source that will have your private loan info: your credit report, which you can order online for free from

“Look for all the education loans listed on your credit report, and then compare the loans on your credit report to the loans that you’ve identified as federal,” Jarvis said. “If there are any loans on your credit report that are not on, it’s because they’re private student loans. 

“And your credit report will list the name of the lender.”

2. What Is the Principal Amount?

Regardless of the type of loan, it’s important to know two things about the principal: 

  1. What is the amount you initially borrowed?

  2. What is the current amount of principal you owe?

If you’ve made any payments toward your loan, you should be aware of whether the payments were going toward interest or principal. These totals should reflect that. Knowing both the initial loan amount and current principal will be important for calculating interest.

Federal Student Loans

The fed’s information about your loan balance could be up 120 days old, so you should contact the lender directly for the updated amount. 

Private Student Loans

For private loans, it’s best to contact the lender directly for the current principal, although your most recent statement should also have this information.

3. What Is the Interest Rate?

A happy male graduate is hugged by his parents.

Getty Images

Knowing the interest rates can help you prioritize which loans to tackle first. Paying off in order of the highest to lowest interest using the debt avalanche method will save you money in interest over the long term.

Federal Student Loans

The feds don’t consider your college career collectively — each academic year you start anew. The same goes for your interest rates.

“The interest rates set for federal student loans are set annually for the upcoming academic year, and they’re not always the same from one year to the next,” Jarvis said. “So people might have a variety of interest rates.”

The good news about federal loans? Unless the loans were issued before 2006, your interest rate will be fixed. So that rate will remain the same over the life of the loan.

Private Student Loans

Private student loans are less likely to have fixed interest rates, so you’ll have a little more homework to do with them. 

“Often, private loans are at variable interest rates, so they can change over time,” Jarvis said. “Everyone who has a private loan at a variable rate should know a couple of things: They should know how often the rate changes and they should know whether there’s any cap on how high the rate can go.”

Pro Tip

Making an extra payment—using a tax refund, perhaps—lowers the amount of interest you pay over the life of the loan. Specify to your lender that the extra money should be applied to your loan balance.

If your interest rate seems really high, that’s probably because it was based on your credit score — and lack of credit worthiness as a college student. Once you have a career with a steady income, you may consider refinancing your loans since you could qualify for lower interest rates. 

4. What Are My Payment Plan Options?

Now that you know the amount you owe and the interest rate, you should find out how to start paying it off. 

Ask your lenders what the estimated payoff dates are to help set your goals and prioritize payments.

Federal Student Loans

If you let the government decide, it will automatically base your payments on the standard 10-year loan repayment plan. But that isn’t your only option.

“Folks tend to have the misunderstanding that they have a monthly payment that’s the required payment on a student loan,” Jarvis said. “And with federal student loans, that’s not the case.”

If you’re unable to make the proposed amount, you have four main options for lower payments that take your income and expenses into account:

  1. Income-Based Repayment Plan (IBR)

  2. Income-Contingent Repayment Plan (ICR)

  3. Pay as You Earn (PAYE)

  4. Revised Pay as You Earn (RPAYE)

You can learn more details about income-driven repayment plans in this article, but Opperman warns that these plans come with conditions that you should discuss with your lending service provider before you sign.

“When the student starts making smaller payments, it’s going to take significantly longer for them to pay,” she said. “And the balance may be growing — much like what happened for some people with the toxic loans and the housing crisis.

“An important question to ask is: If I do make a smaller payment than the loan calls for, is my loan balance going to be growing during the time of the reduced income-based payments?”

Private Student Loans

For private loans, you typically get what you signed up for on your loan documents, so it’s important that you review your loan agreement.

Your payment schedule will more than likely look like what a mortgage term repayment, according to Jarvis.

“Typically, private student loans are going to say you have to fully repay the principal and interest over a specific period of time — say, 15 years,” she said. “And then it will give equal monthly payments spread over that particular period.”

However, if you find yourself struggling to cover the monthly payment, you should still contact your lender for alternative options. After all, it’s in the lender’s best interest to receive smaller amounts of money rather than none.

Pro Tip

If you have both federal and private loans, prioritize paying off the private loans first since they typically have a higher interest rate and almost always lack the benefits that federal loans offer.

One important condition to note in private loans is the co-signer release. Many private loans taken out require a co-signer — often a parent or grandparent — because the student couldn’t get approved on their own. 

But now that you’ve graduated, are gainfully employed and are ready to do some real adulting, you should ask about a co-signer release provision. 

“If there’s a release, it’s a good idea to know what it takes to get it and know when you’ve met the requirements so that you can request it, because there’s nothing automatic about it,” Jarvis said. “Usually it’s something like a couple of years worth of on-time payments.”

5. Do I Have a Grace Period?

Two happy graduates hug each other.

Getty Images

A grace period is the length of time you can wait after graduating from school before you have to make your first payment — but it has nothing to do with whether you’re accruing interest. 

If you have a loan that is already accruing interest (and anything but a direct subsidized loan is accruing), save money by starting to make payments before the grace period lapses.

If you get an unpleasant surprise — like you already missed a payment (or three), Opperman advised immediately calling your lender and asking, “What do I need to do to get back on track and rehabilitate the loan?” 

Federal Student Loans

Federal student loans typically come with the following grace periods after you graduate (or stop attending school at least half time):

During your grace period, the lender or loan servicer should contact you and tell you how much your payments will be and how to make them.

Private Student Loans

Consult your loan agreement or contact your lender to find out if you have a grace period as well as when your first payment is due. 

6. What Happens if I Do Nothing?

If by “do nothing,” you mean you don’t ask for a different repayment plan before your student loans come due, the government will place you on the standard 10-year repayment plan. A private lender will send you your first statement based on the terms you originally signed.

A student loan is considered delinquent if the borrower does not make a payment by the due date. The loan goes into default after a period of missed payments. Both can affect your credit score.

But if by “do nothing,” you mean you don’t pay? Would. Not. Recommend.

Ignoring student loans — federal or private — have serious consequences that can follow you the rest of your life. Even if you’ve moved a number of times over the course of your college and post-graduate days, don’t let that lull you into thinking your lenders can’t find you. 

During your avoidance, you’ll accrue extra interest costs plus any fees for non-payment. Your credit score will be wrecked. Debt collectors will call, repeatedly. You could end up having your wages and tax refunds garnished. 

But even if you can’t afford the payments, you shouldn’t try to run from your loans.

Federal Student Loans

If there’s a reason you’re not able to pay — lack of employment or health reasons, for instance — you have options when it comes to your federal loans. Those options can include income-based repayment plans, deferment or forbearance

Private Student Loans

You have fewer options if you have private loans. However, you should still call your lenders and ask about programs they may offer, which could include a forbearance (there’s typically a fee). 

And remember, if you had a co-signer, they’re on the hook — and at risk of wrecking their credit — if you default on your loans. If you can’t afford the payments and are in danger of defaulting, it’s best to let your co-signer know before they learn about it from a debt collector. 

Once you know what you owe, who you owe it to and when you owe it, you’re on your way to graduating from the burden of student loans and getting back to your future.

Related Posts

This article originally appeared on The Penny Hoarder