Federal vs. private student loan repayment options

When it comes to repaying student loans, there are distinct differences between federal and private student loans.

Federal student loans generally don’t require payments during school and they don't have in-school repayment options. After your grace period, you can generally request a plan (standard, extended, or graduated) to help you adjust the amount of time you have to pay or an income-based repayment plan that bases your payments on your income.

Private student loans can offer both in-school and deferred repayment options. After your separation or grace period, you'll be required to make principal and interest payments. There may be programs available for budget flexibility, such as the Graduated Repayment Period.1

To find out the repayment term for your student loans, log in to your Sallie Mae account.

Sallie Mae® private student loan repayment options

Private student loans don’t have the same repayment options as federal loans, and those specific options can differ from lender to lender. We offer a number of repayment options over the life of your loan.

Payment options while you’re in school
When you apply for a Sallie Mae Smart Option Student Loan® or a graduate student loan like the Graduate School Loan, MBA Loan, Graduate Loan for Health Professions, Law School Loan, Medical School Loan, or Dental School Loan, you can choose one of three in-school repayment options2:

  • Deferred repayment—Make no scheduled loan payments while you’re in school and during your separation or grace period.
  • Fixed repayment—Pay a fixed amount every month you're in school and during your separation or grace period.
  • Interest repayment—Pay only the interest every month you’re in school and during your separation or grace period.

Keep in mind that the Medical Residency and Relocation, Dental Residency and Relocation, and Bar Study loans are designed to cover post-graduate school expenses, so deferred repayment is the only in-school repayment option available.

Repayment programs
When it comes time to repay your student loan, you may have some options. Keep in mind that repayment programs may increase your Total Loan Cost, so we recommend checking with your cosigner first (if you have one) to see if they can help with your payments.

In-School Payment Assistance lets you temporarily postpone your payments while in school and can help you avoid delinquency if you're struggling.

The Graduated Repayment Period (GRP) lets you make interest-only payments for 12 months after your separation period (Time after school). You can request the program during the 6 months before and the 12 months immediately after you begin principal and interest payments. The GRP doesn’t extend the loan term.1
Learn more about the Graduated Repayment Period.

Forbearance lets you temporarily postpone your payments if you’re having trouble and can help you avoid delinquency and default.

Options for our delinquent customers
Your eligibility for any of the following options depends on a review of your financial situation, so please call us at 800-472-5543 and talk with an account manager who will review the repayment options available to you.

  • Rate Reduction lowers your loan’s interest rate and monthly payment for a limited time.
  • Term and Rate Modification can lower your loan’s interest rate and monthly payment for a limited time, while also extending the term of your loan.
  • Payment Extension allows you to bring your loan current by making payments that are equal to or greater than the Current Amount Due for three consecutive months.
  • Reduced Payment Plan allows you to make six months of interest-only payments.

Disability or death
If the student becomes totally and permanently disabled or passes away, we’ll waive the Current Balance. Learn more here.

Defer your student loans when you go back to school at least half-time or are selected for a program. With a deferment, you can reduce or postpone payments when you go back to school or begin an internship, clerkship, fellowship, or residency.3

Learn more about deferring loans while in graduate school.

Deferment or forbearance during military service may be able to postpone payments on your student loans during military service. For more information and eligibility requirements, please chat or call us at 855-534-2668. 
 

Related topics

Learn about interest and capitalization

Understand what student loan interest and interest capitalization are and how they can affect your Total Loan Cost.

Consolidating or refinancing your student loans

Learn the benefits and considerations of consolidating or refinancing your graduate student loans.

Understand student loan payments

Learn how your student loan payments are calculated and then figure out how much you're paying for your student loans—and why.

1. GRP allows interest-only payments for the initial 12-month period of repayment when the loan would normally begin requiring full principal and interest payments or during the 12-month period after GRP request is granted, whichever is later. At the time of GRP request, the loan must be current. The borrower may request GRP only during the six billing periods immediately preceding and the twelve billing periods immediately after the loan would normally begin requiring full principal and interest payments. GRP does not extend the loan term. If approved for GRP, the Current Amount Due that is required to be paid each month after the GRP ends will be higher than it otherwise would have been without GRP, and the total loan cost will increase.

2. Interest is charged starting when funds are sent to the school. With the Fixed and Deferred Repayment Options, the interest rate is higher than with the Interest Repayment Option and Unpaid Interest is added to the loan’s Current Principal at the end of the grace/separation period. Payments may be required during the grace/separation period depending on the repayment option selected. Variable rates may increase over the life of the loan. Advertised variable rates reflect the starting range of rates and may vary outside of that range over the life of the loan. All Advertised APRs assume a $10,000 loan. Smart Option Student Loan APRs assume a freshman borrower with no other Sallie Mae loans. Medical School Loan and Dental School Loan APRs assume 4 years in school. Law School Loan APRs assume 3 years in school. MBA Loan, Graduate School Loan for Health Professions, and Graduate School Loan APRs assume 2 years in school.

3. To apply for internship/clerkship/fellowship/residency deferment, customers and an official from the internship, clerkship, fellowship, or residency program must complete and submit a deferment form to us for consideration. If approved, the loan will revert back to the same repayment option that applied during the in-school period for up to 12 months. Smart Option Student Loan customers can apply for and receive a maximum of five 12-month deferment periods and customers with graduate loans can apply for and receive a maximum of four 12-month deferment periods. Interest is charged during the deferment period and Unpaid Interest may be added to the Current Principal at the end of each deferment period, which will increase the Total Loan Cost.  If you receive the return to school deferment, the Current Amount Due required each month will reflect the same repayment option that applied to your loan during the in-school period. You can receive a maximum of 48 months of deferment. Interest is charged during the deferment period and Unpaid Interest may be added to the Current Principal at the end of each deferment period, which will increase the Total Loan Cost.