Financial aid for students: Rights and obligations

Apart from tuition fees, there are other costs associated with acquiring a college education: room and board, books, educational materials, and other expenses a student might not anticipate.

Students who find it difficult or impossible to pay the costs of a college education can apply for a student loan. There are two main types of student loan: federal and private. Regardless of what the student chooses, there are certain obligations that a student borrower is expected to fulfill.

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Obligations of a student loan borrower

Student loan borrowers are required to repay their loan even if they do not complete their education. They should also know their student loan payment schedules and be aware that non-receipt of a bill or repayment notice is not a valid excuse for missing a payment.

Student loan borrowers should inform their school's financial aid office and their lenders of changes in their personal information: their home address, phone number, or e-mail address. Students planning on transferring to another campus, withdrawing from school, or graduating early or late should also inform their school's financial aid office and their lender.

Student loan borrowers are required by law to attend entrance and exit counseling before graduating to ensure that they fully understand their obligations as student loan borrowers.

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Rights of a student loan borrower

Student loan borrowers have the right to loan counseling. They can seek help in understanding the terms of their loans and have a qualified loan counselor go over their options with them.

Borrowers also have the right to contact their loan servicer directly. Students have the right to apply for forbearance or deferment of student loan payments if certain circumstances are met. For deferment, these include unemployment and economic hardship. Students who don't qualify for deferment may apply for forbearance. During the period of forbearance, a student loan borrower is not required to make loan repayments.

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