Direct Debit FAQ
- What is Direct Debit?
- How do I apply?
- Do I qualify?
- How will I know when the service begins?
- What if my installment amount changes?
- Will I continue to receive my bill?
- Can I pay more than my installment amount?
- What if I request a deferment or forbearance?
- What if my due date falls on a weekend or holiday?
- What if my financial institution information changes?
- What if the funds are not available on my due date?
- How do I discontinue the service?
1. What is Direct Debit?
Direct Debit is an automatic payment service provided free of charge for borrowers who prefer not to write a check every month to make their loan payments. Once approved, each month on your due date your monthly installment, along with any additional amount you have requested, will be automatically withdrawn from the account you have designated. Using this service may also qualify you for an interest rate reduction. Please contact us to find out if your lender offers this incentive.
2. How do I apply?
You can either download the agreement form (below), or contact one of our customer service representatives to receive a copy. Detailed instructions are included with the form to ensure that the request is as easy as possible.
If you are a borrower with a current student loan account, You must complete,sign, and submit the Direct Debit request form (340 KB PDF) to authorize the service.
If you are a borrower with a loan or loans in default status, you must complete, sign, and submit the Default Direct Debit Authorization form (113 KB PDF).
3. Do I qualify?
You are eligible for Direct Debit if your loan(s) have entered repayment, you are receiving a monthly installment bill, your loan(s) are less than 90 days delinquent and have not previously had a Direct Debit payment denied due to insufficient funds three times in a calendar year. Any loan(s) you are currently receiving interest notices or interest bills for will not be eligible for this service until they have entered repayment.
4. How will I know when the service begins?
An approval letter will be sent after your agreement form has been processed. Please be aware that this does not mean the service will begin immediately. The month the service will begin your installment bill will include a message informing you that the payment will be withdrawn.
5. What if my installment amount changes?
If your installment amount changes you will receive correspondence notifying you of your new payment amount. This new amount, along with any additional amount you have requested, will be withdrawn automatically from your account unless you have notified us of your intent to discontinue the service.
6. Will I continue to receive my bill?
Once you have received the bill notifying you that your automatic payments will begin, your monthly statements will no longer be sent. The only exception to this is any time your installment amount has changed. In these cases you will receive a bill to serve as your notification of the change.
7. Can I pay more than my installment amount?
There is no limit to the amount you may have withdrawn from your account monthly. When filling out your agreement form enter the additional amount as instructed. Please be aware that this additional amount will continue to be withdrawn even after a change in installment amount.
8. What if I request a deferment or forbearance?
If your loans are approved for a period of deferment or forbearance, the service will automatically be suspended until this period expires. You will receive an installment bill notifying you of the first payment to be withdrawn following the period.
Please note: To prevent an unwanted Direct Debit extraction while your forbearance or deferment request is being processed, you may also call ahead to have the service suspended.
9. What if my due date falls on a weekend or holiday?
If your due date falls on a weekend or holiday, the payment will be withdrawn from your account the following business day.
10. What if my financial institution information changes?
If at any time you become aware of any changes in your account information, we require that you submit a new Direct Debit application to continue the service. It is important you notify us at your earliest convenience at our toll-free number as it may be necessary for us to suspend the pending transaction in order to prevent a debit from an inactive account. You will need to contact our toll-free number for assistance at least three business days prior to your scheduled payment date.
11. What if the funds are not available on my due date?
If you will not have the funds available in your account the date your payment is to be withdrawn, you should notify us immediately. You will need to contact us at our toll-free number at least three business days before the transaction as we may be able to temporarily suspend the service. If you have not suspended the service and withdrawal is attempted, your payment will remain outstanding until another method of payment is received. Please be aware that repetitive occurrences of this type may result in the termination of the service.
12. How do I discontinue the service?
You must provide us with written notification in order to cancel/discontinue this service. Please allow up to 10 business days for processing this request. If your due date will fall in this processing window, you will need to contact us at our toll-free number at least three business days before the transaction as we may be able to temporarily suspend the service.
- Direct Debit Application (340 KB PDF)
- Direct Debit Application for Defaulted Borrowers (113 KB PDF)