The Grace Period Is Over: Start With This Student Debt Repayment Checklist

Photographed by Rachel Cabitt.

Many people with federal student loans who finished school in the spring are now presented with the task of paying them back.

Stafford loans, the most popular federal loans, have a six-month grace period that gives recent grads, or those who have left school completely or full-time, a buffer to "get financially settled and select [a] repayment plan." (The Perkins loans program, which expired in September, has a nine-month grace period.)

The U.S. Department of Education notes that most loans will still accrue interest during that grace period. What might that look like? CNBC crunched the numbers last year, showing that a $37,000 undergraduate federal direct student loan disbursed in the 2015 - 2016 academic year carried a 4.29% interest rate.

"The interest accrued during the grace period is $794," they explained. "That would grow the total loan balance to $37,794. Under the standard 10-year repayment plan, the grace period raises the monthly payment from $380 to $388, and the total cost of the loan by $981."

You can start paying back your loans during the grace period if you want (and are able) to do so. Once you do start repayment in earnest, though, the first things you should do are: find out your loan servicer, make sure you understand the terms of repayment (including the interest rate, the start date, and the length of repayment), and make sure you are able to move forward.

In some cases, you can seek out deferment or forbearance to delay or reduce your payments on the loan. ("With a deferment," the DOE explains, "you may not be responsible for paying the interest that accrues on certain types of loans during the deferment period.")

But when you move forward, there are some ways to make sure you get off on solid footing. Think of your grace period as an opportunity to take control of your loans, instead of letting them control you, says NerdWallet student loan expert Brianna McGurran. Here are her top-three considerations to make before you start repaying your loans:

1. Sign Up For Auto-Pay

When you sign up for auto-pay, your servicer — the company that collects your loan bill — will automatically debit your payment from your checking account each month, McGurran says. "You'll generally even get a 0.25% interest rate reduction if you sign up."

If you go this route, she continues, make sure that you have enough money in the connected account to cover the bill. Auto-pay can be great, but it is not for everyone — especially people who may need to get out of a paycheck-to-paycheck cycle and become more aware of their income, expenses, and earning potential.

"But overall," McGurran continues, "this is a no-brainer to avoid accidentally skipping a payment if you're on vacation or misplace your checkbook in the middle of a move. Missed payments stay on your credit report for seven years, and payment history is one of the biggest factors in your credit score. Make it a priority to pay on time, and if you can avoid having to think about it, even better."

2. Tie Your Payments To Your Earnings

People with federal student loans, are not locked into a repayment plan, she adds, so consider signing up for an income-driven repayment plan.

"Maybe you're currently on the standard plan — meaning you’ll repay your loans over 10 years — but your bill is super unaffordable on your income. Tie your payments to your earnings, so you never pay more than you can afford."

Some borrowers on income-driven repayment plans may be eligible for loan forgiveness after 20 years (or 240 payments), but that isn't a sure bet. Earlier this year, the Trump administration proposed eliminating nearly $4 billion in Pell grant funding; and by July, the president had still not forgiven any loans from the nearly 15,000 people who applied for loan forgiveness using the borrower defense to repayment rule. Times change, and financial circumstance follow suit.

Nonetheless, income-driven repayment plans can still be beneficial to struggling borrowers. "You'll pay more in interest, and as of now, the IRS will tax the forgiven amount as income," McGurran says. "But these plans are worth exploring if they're the only way you'll keep your loans in good standing. Check out Federal Student Aid’s Repayment Estimator tool to see what you'd pay on each plan."

She adds that borrowers with private loans have fewer options, but that being in contact with a lender can help.

"Call your lender as soon as you think you might have trouble affording your loans. They may be able to give you an interest rate reduction or interest-only payments for a period of time."

3. Don't Fall For Scams

"If you haven't already, you'll probably start getting texts, calls, and Facebook ads from companies that say they can help consolidate your loans or qualify you for loan forgiveness. These companies will charge to sign you up for federal programs that you could participate in for free," McGurran says.

Don't jump at the offer out of desperation. Instead, do your research first. NerdWallet's Student Loan Watch List is one place to start, to see if a company has "engaged in illegal or questionable practices, or has D or F ratings on the Better Business Bureau," she says.

Plus, you may not need to turn to (and, essentially, pay) a third-party for help: Borrowers can sign up for consolidation or income-driven repayment for free at StudentLoans.gov.

"And if you do need help with your loans, contact a legitimate source like your student loan servicer, a certified credit counselor through the National Foundation for Credit Counseling, or a student loan lawyer."

It's true that not all loan servicers are trustworthy (a-hem, Navient...), but borrowers can try to contact the Consumer Financial Protection Bureau with problems or concerns.

"The lenders tend to be really responsive to complaints received on the CFPB," Mark Kantrowitz, a publisher and vice president of strategy at Cappex.com, recently told CNBC. "It's not always going to be in your favor, but they will respond."