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Direct Debit FAQ


Understanding Direct Debit

Can you automatically deduct my payments from my bank account every month?

Yes, we offer an automated payment service called Direct Debit. It's free, convenient, and you may qualify for an interest rate reduction for using this service. Find out how to apply for Direct Debit.

What is Direct Debit?

Direct Debit is a free service where payments are automatically deducted from a specified bank account on the same day each month. It's not only convenient—you don't have to write a check or pay for a stamp—you also may qualify for an interest rate reduction when you use Direct Debit.

How does Direct Debit work?

You must apply for Direct Debit. If we approve your application, your monthly payment - along with any additional amount you request - will be automatically deducted from your bank account and applied to your student loan account.

This automated transaction usually happens on the same date each month.

If your due date falls on a weekend or holiday, we will withdraw the payment from your account the following business day.

Why sign up for Direct Debit?

Direct Debit is the easiest and most convenient way to pay your student loan.

  • No more late fees. Since we automatically withdraw your monthly payments from your bank account, they are never late (as long as the funds are available).
  • Save money. You don't need to purchase stamps and envelopes or pay for checks.
  • Save time. Your time is valuable. The transaction is automatic, so you can spend your time doing other things.
  • Help the environment. Going paperless saves trees.

Using this service may also qualify you for an interest rate reduction. Please contact us to find out if your lender offers this incentive.

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Signing Up for Direct Debit

Am I eligible?

You are eligible for Direct Debit if:

  • Your loan(s) has entered repayment.
  • Your loan(s) is less than 90 days delinquent.
  • You were not previously disqualified from using Direct Debit due to having insufficient funds.

Loan(s) not currently in repayment are ineligible for this service until they have entered repayment.

Can I sign up for Direct Debit if I am past due on my loans?

Yes, but only if your loan(s) is less than 90 days delinquent. You should also make every effort to satisfy any outstanding payments before your Direct Debit service begins. Unsatisfied payments will remain in a past due status, which may result in telephone calls and letters, and may be reported to the nationwide consumer reporting agencies.

How do I apply?

To authorize Direct Debit service, complete the appropriate agreement form.

If your student loan account is in good standing: If your student loan account defaulted to PHEAA:
  1. Sign in to Account Access.

  2. If eligible, click "Sign Up For Direct Debit"

  3. In order to eSign your Direct Debit application, you must create an account PIN. To do so, click "Yes, I want to create My Account PIN Now"

  4. After you create your PIN, you will be directed to the Direct Debit form. Input your bank account information and any additional amount you wish to have deducted each month.

  5. eSign your application with your PIN OR print, sign/date, and return your application to us for processing.

  1. Download and print the Direct Debit Default Collections Application (PDF).

  2. Complete and sign the agreement form.

  3. Fax the form to:

    (717) 720-3644
    Attn: PHEAA Default Collections

    OR mail the form to:

    PHEAA Default Collections
    P.O. Box 8147
    Harrisburg, PA 17105-8147

Once we process your Direct Debit application, we'll send you a letter to notify you of the results of your request.

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Getting Started

How do I know when the service begins?

We send an email that confirms the date and amount of your first Direct Debit payment. If you receive a monthly bill, your bill will also include a message informing you that the payment is scheduled to be withdrawn.

Will I continue to receive my paper bill?

It depends.

If… Then…
All of your loans entered repayment before May 1, 2009, You will no longer receive a paper bill. However, you may sign up for Paperless Billing in your Account Profile Settings.
Any of your loans entered repayment on or after May 1, 2009, You will continue to receive a paper account statement every month, unless you enroll in Paperless Billing.
Can I pay more than my payment amount?

Yes. When filling out the Direct Debit Application, enter the additional amount as instructed. Please be aware that we will continue to withdraw this additional amount even if your installment amount changes, unless you are on an Income Based Repayment Plan and have a payment of $0.00 due. In that case, we will not withdraw any additional amount.

If you want to change the additional amount you pay each month, please complete a new Direct Debit Application.

NOTE: We prorate any additional amount that you pay across all loans with the same due date. If you would like to apply specific amounts to individual loans you can do so using other payment methods in addition to the automatic payments you make through Direct Debit.

Learn more about targeting payments.

If I pay using another method, do you still withdraw a monthly payment through Direct Debit?

Yes. We withdraw your payment (plus any additional amount you request) through Direct Debit every month, even if:

  • You pay your monthly amount (by telephone, mail, or online), before your payment is due.
  • You pay more than your monthly payment amount, resulting in a paid ahead status on your loan.

If you do not want us to withdraw your monthly payment for any reason, you must contact us via telephone at least 3 business days prior to your due date to suspend your Direct Debit service. Even if we suspend your Direct Debit service, you must continue to pay every month using another method.

NOTE: If you qualify for a Direct Debit interest rate reduction but your Direct Debit is suspended, you may not receive the discount for the month for which you requested to suspend the service.

What if the funds are not available on my due date?

Notify us immediately if your bank account will not have the available funds on your scheduled due date. Contact us via telephone at least 3 business days before the transaction, as we may be able to temporarily suspend the service. Telephone is the quickest way to make your request.

If you do not contact us and we attempt a withdrawal, your payment will remain outstanding until we receive another method of payment. We will not attempt a second debit from your account. If your payment is returned due to insufficient funds for 3 months in a 12 month period, your Direct Debit will be cancelled.

NOTE: If you qualify for a Direct Debit interest rate reduction but your Direct Debit is suspended, you may not receive the discount for the month for which you requested to suspend the service.

What if my due date falls on a weekend or holiday?

If your payment due date falls on a weekend or holiday, we will withdraw the payment from your bank account on the following business day.

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Changes to Your Direct Debit Service

What if my payment amount changes?

If your payment ever changes, you will receive a letter with the new payment amount. We will automatically withdraw this new amount (plus any additional amount you have requested) from your bank account on your scheduled due date unless you notify us of your intent to postpone or discontinue Direct Debit.

What if I want to change the additional amount I pay each month?

If you want to change the additional amount you requested to pay each month, please complete a new Direct Debit Application.

NOTE: We prorate any additional amount that you pay across all loans with the same due date. If you would like to apply specific amounts to individual loans you can do so using other payment methods in addition to the automatic payments you make through Direct Debit.

Learn more about targeting payments.

What if my bank account information changes?

If your bank's routing number or your account number changes, you must submit a new Direct Debit Application either online in Account Access or by mailing us a paper application.

It is important you notify us, as we may need to suspend any pending transactions to prevent an attempt to debit from an inactive bank account. Contact us via telephone for assistance at least 3 business days prior to your scheduled payment date.

NOTE: If you qualified for an interest rate reduction for using this service, you will not receive the reduction if your Direct Debit is suspended while your bank information is being updated. Direct Debit will not be active and you must make your payment using another method.

What if I request a deferment or forbearance?

To prevent an unwanted withdrawal while your deferment or forbearance request is being processed, contact us to suspend your Direct Debit service. We will automatically suspend your Direct Debit service once your deferment or forbearance is approved.

At the end of your deferment or forbearance, we will notify you that your Direct Debit service will resume on your regularly scheduled due date. You must notify us with a signed, written request, if you no longer want to participate in this service.

NOTE: You will not receive an interest rate reduction during your deferment or forbearance period.

If I have new loans that come into repayment, will they be included in my Direct Debit service?

No. You must complete a new Direct Debit Application to include new loans. You can complete, sign, and return an application or eSign an application through Account Access.

How do I cancel or discontinue Direct Debit?

The easiest way to cancel your Direct Debit service is to email us through your online account. You can also send an email from the email address you have on file to aescs@aessuccess.org or mail us a signed, written request. Please allow up to 10 business days to process this request.

If your due date falls within this processing window, contact us via telephone at least 3 business days before the scheduled transaction, as we may be able to temporarily suspend your Direct Debit.

NOTE: If you qualified for an interest rate reduction for using this service, that reduction will be removed once you cancel Direct Debit service.

What will happen if I am on Direct Debit and my final payment is less than my regular monthly withdrawal amount?

If your final payment is less than your regular monthly payment amount, the final debit will be adjusted to only withdraw the remaining amount due.

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