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Targeting & Processing Payments

Targeting Payments

If you want to pay more than the minimum amount due on your bill, targeting the extra funds to specific loans may be your best option. Targeting payments:

  • Gives you the choice of where you want the extra money to go
  • May reduce the interest you will pay over time
  • Can save you money in the long run

You may wish to target the extra funds to unsubsidized loans, loans with high balances, or loans with higher interest rates. If you pay more than the total amount due and don't target your payment, we will apply the extra amount toward a future bill (if you have one), unless you qualify for a $0.00 payment with Income-Based Repayment. The extra amount is spread across your loans based on the amount due for each loan.

NOTE: Paying more than the minimum amount due could place your account in a paid ahead status.

How to Target Online Payments

To target additional funds to specific loans:

Step 1 Sign in to Account Access.
Step 2 Click "Make a Payment".
Step 3 Select the "Specify Loan Payment Amounts" tab.
Step 4

Enter payment amount (Minimum Amount Due + Additional Funds).

Remember: You must pay AT LEAST the minimum amount due on each loan sequence, or your account will go past due.
Step 5 Hit the "Make a Payment" button.

How to Target Payments by Special Arrangement

The easiest way to target your payments is to pay online. However, if you want to have all of your future extra payments applied in the same way, you can write to us and provide standing instructions.

View methods for providing standing instructions.

  • Mail or fax—To include instructions with a check or money order, use a separate sheet of paper. Do not write instructions directly on your check, money order, or bill stub!
  • Email—To provide instructions by email, please contact us through Account Access.

You will need to specify how you want your extra funds applied to your individual loans, and you'll need to identify your loans by disbursement date and loan type (which you can find in Account Access). We can help you through this process if you contact us, or you can see an example of what you may want to include with your request by reviewing the Consumer Financial Protection Bureau's sample letter (DOC) about providing such instructions.

If you decide to pay extra every month through Direct Debit, standing instructions will be the easiest, ongoing method for you to target payments.

If you ever need to target a one-time extra payment or amount, or if you need us to reapply a payment you previously made, we can accommodate that as well.


Payment Processing

Payment Transactions

We generally do not accept payment transactions on weekends or holidays. If you're on Direct Debit or mail us a payment that we receive on a weekend or holiday, we will process it effective the date we receive it, but it may take a few days for processing or to post to your account. You should submit payments for due dates falling on a weekend or holiday on the business day before your due date. We may credit your payment to your account a few days before you can see it online in Account Access.

Payment Application

When you make a payment, we count the number of days since we processed your last payment to determine how much interest has accrued since that time.

We apply your payment in one of two ways, depending on your lender and loan type.

  • Accrued interest > Late fee (if applicable) > Current principal balance
  • Late fee (if applicable) > Accrued interest > Current principal balance

To review a past payment, sign in to Account Access and select "Payment History" under the "Payment and Billing" tab on the left-hand side. Choose the payment you would like to review and select "View Details" to see how much applied to interest and principal.

For more details on how your payments are applied and processed, please review the specific account status:

Payment on Current Account

If you pay more than the amount due, your account may reflect in a paid ahead or partially paid ahead status. Unless instructed otherwise, we will apply the payments as follows.

  1. Accrued interest—The amount of interest that accrued every day between the date of the last payment and the new payment is satisfied first.
  2. Current principal balance—The remainder then applies toward your current principal balance.
  3. Extra amount—If you pay more than the total amount due, we will apply the extra amount toward the principal amount due of a future bill (if you have one), unless you qualify for a $0.00 payment with Income-Based Repayment. The extra amount is spread across your loans based on the amount due for each loan. This may place your loans in a paid ahead status.

Payment on Past Due Account

When your loan is past due, we apply your full payments like this:

  1. Interest and late fees—Your payment will first satisfy any outstanding interest and late fees (if applicable). Depending on your lender, the payment may go to late fees first, or vice versa.
  2. Past due balance—Once all accrued interest is satisfied, the payment is applied next to your past due balance before we apply any funds to your current principal balance.
  3. Current principal balance—The remainder then applies toward your current principal balance.
  4. Extra amount—If you pay more than the total amount due, we will apply the extra amount toward the principal amount due of a future bill (if you have one), unless you qualify for a $0.00 payment with Income-Based Repayment. The extra amount is spread across your loans based on the amount due for each loan. This may place your loans in a paid ahead status.

Partial Payment on Current Account

When your loan is not past due, we apply your partial payments like this:

  1. Accrued interest—The interest that accrued every day between the date of the last payment and the new payment is satisfied first. If you have multiple loans and your partial payment doesn't satisfy the full amount of accrued interest due, the payment is spread across your loans based on the amount due for each loan.
  2. Current principal balance—If your partial payment satisfies all of the accrued interest, the remainder then applies toward your current principal balance. If you have multiple loans, the remainder of your partial payment is spread across your loans based on the amount due for each loan.

If you do not fully satisfy the total amount due, your loans will be past due and late fees may be assessed.

For Example: If you have two loans that have $25.00 due and one loan that has $100.00 due, more of the payment will go to the loan due for $100.00, so that it doesn't become more past due than the other loan.

Partial Payment on Past Due Account

When your loan is past due, we apply your partial payments like this:

  1. Interest and late fees—Your payment will first satisfy any outstanding interest and late fees (if applicable). Depending on your lender, the payment may go to late fees first, or vice versa. If you have multiple loans and your partial payment doesn't satisfy the full amount of accrued interest due, the payment is spread across your loans based on the amount due for each loan.
  2. Past due balance—Any remainder is applied next to your past-due balance before we apply any funds to your current principal balance. If you have multiple loans and your partial payment doesn't satisfy the full past due balance, the payment is spread across your loans based on the amount due for each loan.
  3. Current principal balance—If your partial payment satisfies all of the accrued interest and late fees, the remainder then applies toward your current principal balance. If you have multiple loans, the partial payment is spread across your loans based on the amount due for each loan.

If you do not fully satisfy the full amount due, your account will remain past due. However, if you are able to make partial payments that satisfy past due bills, you may be able to reduce the level of delinquency (number of days past due) of your loans. This can help prevent default and other consequences of delinquency.

It is important to make your payments on time each month, so your loan doesn't become delinquent. Delinquent loans are at risk for negative credit reporting. If you can't afford to make a payment or your account is already past due, we may be able to help you!

Debt Management

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