Aug
13
2025
happy family mobile

College Move-In Day for Parents

By | Going to College, Student Loans, student_loan | Comments Off on College Move-In Day for Parents

Attending college is a big milestone that both parents and students look forward to for many months.

While this is a highly anticipated event, college move-in day can also be a very stressful and emotional day for both students and parents. Attending a college that is out of state can be another nerve-wracking factor.

Moving can be challenging, especially if it’s hot or you have to climb up several sets of stairs. Fortunately, there are several things you can do ahead of time over the summer that can help ensure the day goes as smoothly as possible.

Key Points

•  On college move-in day, it’s best to beat the crowds and find parking more easily by arriving early, giving you and your child more time to settle in and meet roommates.

•  Bring only essential items to avoid clutter and make the move-in process smoother and less stressful.

•  Maintain a positive and encouraging attitude to help your child feel confident and excited about their new college life.

•  Introduce yourself to your child’s roommates and their families to foster a friendly and supportive living environment.

•  After helping with move-in, trust your child to handle their new independence and encourage them to explore and engage with their new surroundings.

Preparing for the Big Day

Getting organized beforehand is one surefire way to prepare for the big move as a college freshman. Here are a few ideas to help you and your child get ready for move-in day.

Getting Familiar with Dorm Room Rules

Being prepared and learning what the college dorms allow students to bring can relieve some potential headaches. Colleges typically post a list of items that students can bring and ones that are prohibited in the residence halls.

Sticking to the basics is a good start since your child can buy more items from a local store or have it shipped to them at a later date.

Recommended: College Essentials: What to Bring to College

Coordinating with Your Roommate

Recommend that your child contact their roommate over the summer and discuss their interests and what items each of them are bringing. This can be one way to help avoid bringing duplicates, especially for larger items like TVs or bean bags.

Another idea is to coordinate the time you are going to move in so you can assist each other during the process. This can also be helpful if the parents are interested in meeting each other.

Packing with Purpose

Packing for college can be a frustrating task, but one way to expedite the chore is to have your child label all the containers and boxes so you know what’s already packed and can easily find things once you arrive. If you have items that are more fragile, consider putting them into heavy plastic containers so they are less likely to be damaged during the move.

Also consider making a list of must-have items to limit the chance that something important is forgotten. For example, bedding, computer, school supplies, a first aid kit, and basic tool kit — which can be extremely useful on move-in day.

Consider the Climate

If your child is attending a college that is out of state or in a different climate, you may have to build out a more weather-appropriate wardrobe. For instance, if your child is moving to a college in the Midwest from Florida, you might buy and pack weatherproof boots, jackets, scarves, gloves, and other clothing suited for colder temperatures.

If they are attending college in a warmer climate, consider packing more t-shirts and shorts and leave some of the sweatshirts and wool sweaters at home.

Recommended: College Planning Guide for Parents

Planning Travel Arrangements

Once you’ve organized and packed all of your child’s belongings, it’s time to decide how you’ll get everything to campus. This will likely depend on factors like how far away the school is.

Consider renting an SUV or a moving van if the university is within driving distance and you own a smaller vehicle. If you plan on driving your own vehicle, pack the car strategically, so items you’ll need first (like cleaning supplies), are easily accessible when you arrive.

If you’re planning to fly to the college, another strategy may be to mail some of the belongings to the residence hall ahead of time, if it is permitted.

💡 Quick Tip: Parents and sponsors with strong credit and income may find much lower rates on no-fee private parent student loans than Federal Parent PLUS Loans. Federal PLUS Loans also come with an origination fee.

What to Expect on Move-In Day

Below are some ways to make college move-in day easier on you and your student.

Limit the Number of People

While going to college is exciting for your child and your family, consider limiting the number of people you bring with you on moving day.

Having too many people could actually slow down or complicate the process. Plus, it’s likely that many students and their parents will all be in the residence halls at the same time. Dorm rooms can be pretty small and having more people in the space could create more chaos and tension.

Instead, consider planning a visit when there is more flexibility. Many colleges have a family weekend in the fall. This could provide an opportunity for a longer, more relaxing and fun visit, especially if grandparents, aunts, and uncles also want to tag along.

Be Prepared for Hot Weather

Since many students move in during late summer, it can help to be prepared for heat (and humidity, depending on the local climate). It’s likely going to be hot, especially if the residential dorm does not have central air conditioning and only window units or getting to a top floor requires traipsing up and down several flights of stairs.

Consider bringing a fan to help circulate some air while you get everything settled.

Wear Comfortable Clothing

Doing all that heavy lifting is no easy task. Wear comfortable clothing and shoes for the move and bring another outfit to change into later as you tour the campus or grab dinner with your child.

Bring Snacks

Bringing water and snacks is generally a good idea too, especially if you are moving furniture and other heavier items. Putting the drinks in a cooler will help keep them cold, especially if the room does not have a refrigerator. Make sure you have enough for the roommate and their parents.

Remember a Dolly

Determine whether the residence hall has a dolly or other items that you can borrow because they can help make the move easier. Signing up for those items early can help ensure that you can use them the day you move in. Otherwise, you can buy one from a local hardware store or split the costs with a roommate or another friend who is living in the same residence hall.

Students who have other friends who are also moving in during the same day might want to consider connecting beforehand so they can help each other move, especially bulky or heavier pieces of furniture.

Buy Some Items Later On

If your student lives near a grocery or drugstore, they can buy other items later on or they can have the items delivered to them. Many retailers offer free shipping and stores at college campuses often have special offers suited for students.

Move-in day can be emotional, for everyone involved. As hard as it is to say goodbye, try not to hang around too long — let your child adjust to their new surroundings, hang out with their new roommate, make new friends in their residence hall, and get ready for their first day as a freshman.

When we say no required fees we mean it.
No late fees, & insufficient fund
fees when you take out a student loan with SoFi.

Considering SoFi Private Student Loans

As you gear up for move-in day, you may have other concerns, including how you’re going to cover the cost of your child’s education. Financing your child’s education is a large responsibility and can be complicated. While there are some ways to prepare for college, like filling out the FAFSA to apply for federal aid, some families do not receive enough to pay for tuition and room and board entirely.

After exhausting federal aid options, you might want to explore private student loans. Just keep in mind that private student loans don’t offer the same protections, like government-sponsored forgiveness programs, that come with federal student loans.

The Takeaway

College move-in day is a significant milestone for both students and parents, marking the beginning of a new chapter filled with excitement and challenges. From packing efficiently and arriving early to staying positive and knowing when to step back, each step plays a crucial role in setting the stage for a successful college experience.

When it comes to how to pay for college, students and parents can rely on cash savings, scholarships, grants, federal student loans, and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.


Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

How can parents best help with college move-in day?

Parents can best help with college move-in day by arriving early, packing efficiently, staying positive, meeting roommates and their families, and knowing when to step back. This ensures a smooth transition and sets the stage for a successful college experience.

What is a crucial step for parents to take after helping their child move in?

A crucial step for parents after helping their child move in is to know when to step back and allow their child to begin their independent college life. This might involve saying goodbye and leaving the campus, trusting that they are ready for this new phase, and encouraging them to explore and engage with their new environment.

How can parents support their children emotionally during college move-in day?

Parents can support their children emotionally by staying positive, being encouraging, and acknowledging their feelings. It’s important to reassure them that it’s normal to feel nervous or excited and to remind them of the exciting opportunities and experiences that await them in college.

About the author

Julia Califano

Julia Califano

Julia Califano is an award-winning journalist who covers banking, small business, personal loans, student loans, and other money issues for SoFi. She has over 20 years of experience writing about personal finance and lifestyle topics. Read full bio.



SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.


Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOISL-Q325-076

Read more
Aug
12
2025

Defaulting on Student Loans: What You Should Know

By | Debt Payoff, Fresh Out of School, Student Loans, student_loan | No Comments

Defaulting on student loans can happen after a borrower misses a series of payments on their loan. The number of loan payments missed before the loan enters default is different depending on whether the loans are federal or private, but the consequences of defaulting on either type can be severe. Ramifications include having the loans go to a collections agency and potential negative impacts on your credit score.

Read on to learn more about what student loan default is and what happens if you default on student loans.

Key Points

•  Missing just one federal student loan payment leads to delinquency, which can be reported to credit bureaus after 90 days of missed loan payments.

•  Federal student loans default after 270 days of nonpayment, while private loans typically default after 90 to 120 days, though this may vary by lender.

•  Default on federal loans results in the remaining loan balance becoming immediately due in full, wage garnishment, and loss of eligibility for forgiveness and forbearance, among other consequences.

•  Private loan default can lead to collection agency involvement.

•  Options to avoid default include contacting the lender, loan rehabilitation, loan consolidation, refinancing, and seeking credit counseling or legal aid.

What Is Student Loan Default?

Student loan default is a term for when you stop paying student loans by failing to make the required monthly payments on federal or private loans.

For example, if a borrower is having issues making monthly payments on their federal student loans and they stop paying them, after a certain number of missed payments, the loan will enter default.

There are serious repercussions for defaulting on student loans. What happens if you default on student loans is the balance of your loan becomes due in full immediately, your wages may be garnished, and your credit rating is damaged, among other consequences.

Take control of your student loans.
Ditch student loan debt for good.

How Long It Takes to Enter Default

The length of time it takes to enter default depends on the type of student loan you have. For federal Direct loans and Federal Family Education Loans (FFEL), if a borrower fails to make a payment for 270 days, their loan is considered to be in default. (If a borrower has a federal Perkins loan, their loan can be deemed to be in default after just one missed payment.)

Private student loans have a different timeline for default, which can vary by lender. In general, however, private student loans are considered to be in default after 90 or 120 days of missed payments, depending on the lender.

Student Loan Default vs. Delinquency

Student loan delinquency is the early stage of missing a required loan payment. If you fail to pay over an extended period, you could face greater consequences for reaching late-stage delinquency.

Federal student loans are considered delinquent when you’re past due on a required payment by at least one day but less than nine months. Federal student loans are typically reported to the credit bureaus as delinquent if you are 90 or more days past due.

A delinquent federal student loan typically goes into default if you fall at least 270 days past due on required payments.

Lenders of private student loans can set their own parameters for delinquency vs. default. Banks, credit unions, and online lenders offer private student loans. Some may consider you in default if you are 90 or more days delinquent on a private student loan. Others may define default as falling 120 days past due after receiving a final demand letter.

Can You Default on Student Loans?

Yes, it’s possible for borrowers to default on student loans. If you are struggling to make monthly payments on your federal student loans and just stop paying them, after a certain number of missed payments, the loan will be in default.

Private student loans can also go into default, though, as mentioned above, this can happen more quickly than it does with a federal student loan.

Recommended: What is the Student Loan Default Rate?

How to Default on Student Loans

Defaulting on federal student loans is a process that takes place over a period of nonpayment. Typically when you first miss a payment, the loans are delinquent but not yet in default. At 90 days past due, your lender can report your missed payments to credit bureaus. And, as mentioned above, when you reach 270 days past due, your student loans are typically considered in default.

For private student loans, the terms for default can vary. Private student loan lenders may consider you in default if you’re 90 or 120 days or more past due on a required payment.

Private lenders may also place student loans in default if the borrower declares bankruptcy, passes away, or defaults on another loan. Terms can vary by lender, so if you have private student loans, double-check how they define default.

Defaulting on student loans can have serious consequences, but there are ways to avoid defaulting on your student loans — or recover if your loans are currently in default.

What Happens When Your Student Loans Default?

Here are four potential consequences of what happens if you default on student loans.

1. Collection Agencies Might Come Knocking

When a borrower defaults on student loans, the lender may eventually turn the debt over to a collection agency. The collection agency will then attempt to recover the payment, typically reaching out to you with frequent letters and phone calls.

Collection agencies may also attempt to determine what other assets, including bank accounts or property, would allow you to pay your debt. On top of dealing with regular calls from debt collectors, you may also be responsible for paying any additional fees the collection agency charges on top of your student loan balance.

2. Loan Forgiveness and Forbearance Options Are No Longer on the Table

Student loan default on federal loans means that the federal government can revoke your access to programs that might make it easier for you to pay your loans, including loan forgiveness or forbearance. This means that even if you qualify for something like the Public Service Loan Forgiveness program, you could be rendered ineligible if you let your loans go into default.

3. Your Credit Score Might Be Impacted

Once your student loans are in default, the lender or the collection agency will report your default to the three major credit bureaus. This means that your credit score could take a hit. A low credit score can make it harder for you to get a competitive interest rate when borrowing for other needs, like a car or home loan. In fact, having federal student loans in default can make it difficult to buy or sell real estate and other assets.

4. You Might Have to Give up Your Tax Refund, or a Portion of Your Wages

If your loan holder or a collection agency can’t recover the amount owed, they can request that the federal government withhold your tax refund and even garnish some of your income. For example, if you filed your taxes and were eligible for a refund, the government would instead take that refund money and apply it toward your defaulted student loan balance. On top of that, the government can garnish your wages, which means that they can take up to 15% of each paycheck to pay back your loans.

Recommended: What Happens When Your Student Loans Go to Collections?

5. You Could Lose Eligibility for Future Federal Aid

When your federal student loans go into default, you lose eligibility for additional federal aid, such as federal loans and federal Pell Grants. If you were planning to return to school, for instance, you will not be able to get federal student aid to do so.

How Can You Get Student Loans Out of Default?

Defaulting on student loans is a serious matter, but the good news is that there are ways of getting out of default.

To help recover from defaulted student loans, first, stop avoiding collection calls. If your student loan provider or a collection agency is calling, your best bet is to meet your lender or the agency head-on and discuss your options. The lender or the collection agency will be able to talk through the repayment options available to you based on your personal financial situation. They want you to pay, which means that they might be able to help find a payment plan that works for you.

The lender may be able to offer options tailored to your individual circumstances, such as satisfying the debt by paying a discounted lump sum, setting up a monthly payment plan based on your income, consolidating your debts, or even student loan rehabilitation for federal loans (see more about this below). Don’t let your fear stop you from reaching out to your lender or the collection agency.

How to Avoid Defaulting on Student Loans

Of course, even if you can get yourself out of student loan default, the default can still impact your credit score and loan forgiveness options. That’s why it’s generally best to take action before falling into default. If the student loan payments are difficult for you to make each month, there are things you can do to change your situation before your loans go into default.

First, consider talking to your lender directly. The lender should be able to explain any alternate student loan repayment plans available to you.

For federal loans, borrowers may be able to enroll in an income-driven repayment (IDR) plan. These repayment plans aim to make student loan payments more manageable by basing them on the borrower’s discretionary income and family size. This can make the loans more costly over the life of the loan, but the ability to make payments on time each month and avoid going into default are valuable.

There are currently, as of August 2025, several options for income-driven repayment. Depending on the plan you enroll in, the repayment term is extended to 20 to 25 years and payments are capped at 10% to 20% of your income. However, the U.S. domestic policy bill that was passed in July 2025 eliminates a number of student loan repayment plans. For borrowers taking out their first loans on or after July 1, 2026, there will be only two repayment options: the Standard Repayment Plan, which is a 10- to 25-year repayment plan, and the Repayment Assistance Program (RAP).

RAP is similar to previous income-driven plans that tied payments to income level and family size. On RAP, payments range from 1% to 10% of adjusted gross income for up to 30 years. At that point, any remaining debt will be forgiven. If your monthly payment doesn’t cover the interest owed, the interest will be cancelled.

One thing to be aware of is that while an income-driven repayment plan might help make monthly payments more manageable, extending the length of the loan means you could end up paying more interest than you would on the Standard Repayment Plan. The good news is that if you still have a balance at the end of the repayment term, your remaining debt is discharged (although it may be taxed).

Is Refinancing an Option?

Student loan refinancing could potentially help you avoid defaulting on your student loans by combining all your student loans into one new loan. When you refinance student loans, you might be able to secure a lower interest rate or loan terms that work better for your situation.

You can use a student loan refi calculator to see how much refinancing might save you.

However, if a borrower is already in default, refinancing defaulted student loans could be difficult. When a student loan is refinanced, a new loan is taken out with a private lender. As a part of the application and approval process, lenders will review factors including the borrower’s credit score and financial history among other factors.

Borrowers who are already in default may have already felt an impact on their credit score, which can influence their ability to get approved for a new loan. In some cases, adding a cosigner to the refinancing application could help improve a borrower’s chances of getting approved for a refinancing loan. But know that if federal student loans are refinanced they are no longer eligible for federal repayment plans or protections.

Help on Defaulted Student Loans

If you default on a federal student loan, here are some programs that can help you get them out of default.

Loan Rehabilitation

To apply for student loan rehabilitation, contact your loan servicer. In order to rehabilitate your federal student loan you must agree to make nine voluntary, reasonable, and affordable monthly payments within 20 days of the payment due date. This agreement must be completed in writing. All nine payments must be made within 10 consecutive months.

Private student loans do not qualify for federal student loan rehabilitation. Federal Direct Loans or loans made through the Federal Family Education Loan (FFEL) program qualify for student loan rehabilitation.

Loan Consolidation

Consolidating your federal student loans into a Direct Consolidation Loan is another option to get your defaulted federal student loans out of default. To consolidate defaulted federal student loans into a new Direct Consolidation Loan you have two options, which are:

•  Repaying the consolidated loan on an income-driven repayment plan.

•  Making three monthly payments on the defaulted loan before consolidating. These payments must be consecutive, voluntary, on-time, and account for the full monthly payment amount.

Again, private student loans are not eligible for consolidation through a Direct Consolidation Loan.

Recommended: Understanding How Student Loan Consolidation Works

Consumer Credit Counseling Services (CCCS)

Consumer Credit Counseling Services (CCCS) are usually non-profit organizations that offer free or low-cost counseling, education, and debt repayment services to help people facing financial difficulties.

If you’ve defaulted on a student loan, a credit counselor may be able to help by looking at your entire financial situation along with your student debt, laying out your options, then working with you to come up with the best option for student loan debt relief.

If you’re struggling with multiple debts, a credit counselor may be able to set up a debt management plan in which you make one monthly payment to the credit counseling organization, and they then make all of the individual monthly payments to your creditors.

While counselors usually don’t negotiate down your debts, they may be able to lower your monthly payments by working with your creditors to increase your loan terms or lower interest rates.

Just keep in mind: Credit counseling agencies are not the same thing as debt settlement companies. Debt settlement companies are profit-driven businesses that often charge steep fees for results that are rarely guaranteed. Debt settlement can also do long-term damage to your credit.

To avoid debt settlement scams and ensure you find a reputable credit counselor, you might start your search using the U.S. Department of Justice’s list of approved credit counseling agencies.

For borrowers who need legal help with defaulted student loans, there are some legal aid resources available. Legal aid is typically free of charge to those below a certain level of income or who meet other requirements. To find legal aid in your state (if it is available), check LawHelp.org, a national nonprofit that provides referrals to legal aid.

Another resource is the American Bar Association’s Legal Help Finder, which can help low-income borrowers locate free legal help.

If you don’t qualify for free legal help with your student loans, the National Association of Consumer Advocates may be able to assist you in finding a lawyer in your area who handles student loan issues.

The Takeaway

Student loan default can have serious negative effects on your credit score and financial stability. If you’re worried about defaulting on your student loans, or you have already defaulted, consider taking immediate steps to remedy the situation before it gets worse. Contact your lender or loan servicer to learn about options available, such as loan rehabilitation, loan consolidation, and refinancing your loans.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

FAQ

Does a defaulted student loan ever go away?

It is possible to rehabilitate or consolidate a defaulted federal student loan to get it out of default so that it “goes away.” Some private lenders may offer programs or assistance to borrowers facing default, but they are not required to do so.

Will my student loans come out of default if I go back to school?

No, if you have student loans already in default, going back to school will not remove them from default. Students who have student loans in default will need to get the loans out of default before they can qualify to borrow any additional federal student loans.

Are defaulted student loans forgiven after 20 years?

Defaulted loans are not forgiven after 20 years. Students in default may consolidate or rehabilitate their loan and then enroll in an income-driven repayment plan, which could potentially qualify them for loan forgiveness at the end of their loan term, up to 25 years.

Can defaulted student loans affect my taxes or wages?

Yes, if you default on federal student loans, the government may garnish your wages — which means your employer may be required to withhold a portion (typically up to 15%) of your pay and send it to the loan servicer to repay your loan. In addition, your tax refunds may be withheld and the money applied to repayment of your defaulted loan.

What are the fastest ways to recover from student loan default?

Loan consolidation is generally one of the fastest ways to recover from student loan default. To do it, a borrower consolidates their defaulted loans into a new Direct Consolidation Loan, which immediately ends the default status of the loans. The borrower must agree to repay the consolidation loan on an income-driven repayment (IDR) plan or they must make three consecutive on-time full monthly payments before consolidating.

Just be aware that when you consolidate a defaulted loan or loans, the default remains on your credit report for seven years.

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.


Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SOSLR-Q325-029

Read more
Aug
12
2025
open laptop on desk

Is it Possible to Take Online Classes While Working?

By | Budgeting & Goals, Building Your Career, Going to College, Student Loans, student_loan | Comments Off on Is it Possible to Take Online Classes While Working?

Many students work to cover expenses and gain on-the-job experience while furthering their education. For some learners, taking online classes while working is one way to fit school into an already packed schedule.

While online classes allow you to study virtually anywhere, at any time, the quality of these programs can vary tremendously. Also, you may miss out on the ability to make professional and personal connections vs. in-person classes.

Read on to learn more about taking online classes while also working full-time, including the pros and cons, and strategies for juggling the demands of school alongside holding down a job.

Key Points

•   Online classes, which allow for flexible scheduling, can be pursued while working full-time.

•   Location independence of online classes can reduce travel time and expenses.

•   Online programs often have lower living costs than on-campus courses.

•   Networking with peers and professors is more limited when taking classes online.

•   Engagement with course materials and seeking help can be more challenging online.

Pros of Taking Online Classes

Given the time and financial investment that earning a degree can require, it can be helpful to weigh different schooling options before deciding whether to pursue an in-person education, online classes, or some hybrid of the two. Online classes can have some distinct advantages.

Here’s a look at some potential pros of working towards a degree or certificate online.

Having a Flexible Schedule

T

Traditionally, college and graduate school courses meet once or multiple times per week throughout a semester or summer/winter session. The length of class time varies too. For example, large lectures may only span one hour, while once-per-week seminars could run for two or three hours.

If you’re taking a full-time course load, which usually constitutes a minimum of twelve credit hours, you’ll have to coordinate these blocked-out class hours around your existing work schedule.

As a result, in-person learning (where students are expected to be in class at a set time each week) is not always feasible if you plan to work and study at the same time.

If you work full-time, online classes can come with added flexibility. After all, online courses are often facilitated through prerecorded lectures, streaming video tutorials, self-guided activities, and reading that can be done on a student’s timeframe.

In some cases, online classes do still include a certain number of live lectures or learning activities (typically hosted via streaming video) that enrolled students are expected to attend.

In those scenarios, you might need to arrange your work schedule so you’re not on the job during the times when live online classes convene. That can help you take online classes successfully.

Naturely, most online classes still assign homework, so you’ll also need to consider when you’ll fit in independent reading, projects, and studying. However, online degree programs and classes often offer a higher level of scheduling flexibility, allowing you to “attend class” and study at times when you’re not working.

Maintaining Location Independence

There are thousands of colleges and universities across the United States, but probably only a handful near your home or place of work. While taking classes as a commuter student might be logistically possible, sticking to programs hosted by local universities can limit your choice of faculty and subject areas.

Additionally, it’s possible that local options aren’t the top-ranked in a given field — and might not even offer specific degrees or pre-professional certificates.

On the flip side, the only location required for taking online classes while working full-time is a reliable internet connection and a comfortable study space. Online classes also save time traveling to and fro a campus, giving you more time to juggle post-secondary studies alongside your regular job.

Possibly Lower Living Expenses

Tuition is only part of the equation when calculating the total cost of attending college. Some universities may require students to live on campus for one or more years, which could carry dining hall and other fees (in addition to the base cost of living in a dorm).

Students attending four-year public universities can expect room and board to run, on average, $12,302 a year, according to the Education Data Initiative. Opting for an online degree program can help bypass some of these additional expenses.

Cons of Taking Online Classes

In addition to online learning’s pros, there are some potential cons to think through when evaluating taking online classes while working full time.

Not Every Degree or Major Is Available

Colleges across the U.S. offer a wide array of majors and types of degrees. Online programs, on the other hand, tend to be more limited. So whether or not you can take online classes while working will depend, in part, on your chosen field of study.

For online bachelor’s degree programs, majors focused on business and health professions are among the most commonly available. Students interested in earning a master’s degree online in business or healthcare are in luck as well. There are also opportunities to enroll in graduate programs in education, engineering, criminal justice, and various social sciences entirely online.

Other majors and degrees, especially those that require in-person lab time or hands-on apprenticeship, such as culinary arts or chemistry, might not translate as well to an online format.

Recommended: Return on Education for Bachelor’s Degrees

Limited Networking Opportunities

Attending college in person can provide opportunities to make friends and build relationships with professors. Building a deep social and professional network while in school can help you find internships and jobs after school ends.

Taking online classes, however, can make it more challenging to connect with professors and fellow students. That being said, it’s still possible to make a strong impression on professors and peers through course assignments, presentations (whether individual or group), and written correspondences.

If you are planning on taking online classes while also working full-time in the same field (e.g., a nurse or a teacher studying for an extra certification in those professions), this potential networking disadvantage may be less of a concern — since you can still connect with fellow professionals on the job.

Can Be Hard to Focus and Seek Help

Some students may find that it’s harder to stay engaged with online classes vs. those that are given in person. It may be easier for them to be distracted or zone out. Also, when they have questions or issues with a concept, it may take more effort to get assistance than if they were in a real-world classroom.

Strategies for Taking Online Classes

Whether you just graduated high school or are returning to the classroom after years of working, being prepared can help you get the most from your online classes — and, ideally, help to create a healthier work-life balance. Here are some key ways to prep for working full time and going to college.

Making a Schedule and Sticking to It

The flexibility of online classes can feel liberating, but those readings, online discussions, and assignments still need to be completed. Keeping your work schedule in mind, it can be helpful to block out some non-work hours during the week or weekend just for studying and school assignments.

It may also be helpful to think about when to get school work done. If you’re not a morning person, it’s likely you won’t be cracking the textbooks at sunrise. If you find out that your present work-school schedule is hard to sustain over time, it’s perfectly okay to go back to the drawing board.

The important thing is to find a time-management system that works for the duration of the time you’re both working and studying full time.

Starting Small

Even if you feel confident and excited about returning to the classroom (virtual ones count, too), taking online classes while working full time may be a big adjustment.

Some online degree programs allow you to enroll as a part-time student, which can be a “trial-run” opportunity — allowing you to understand how demanding juggling school and studies can be (before paying full tuition).

Understanding how much time each online class will demand can help you to be realistic about how many classes you can take each semester without burning out.

Setting Goals and Rewarding Progress

Creating achievable goals at the beginning of each class or semester is one way to stay on track, grow as a student, and measure success. Attaching a reward to these periodic goals can help many learners to stay driven and engaged.

Whether you passed your first online class, completed a big group project, or got a key certification, you deserve to celebrate achieving your educational accomplishments.

Paying for Online Classes

For some students, the cost of online education (after subtracting dorms, dining plans, and transportation) can be an additional determining factor. The individual cost of online degrees and certificates will vary significantly from school to school — including price differences between public and private university programs.

In some cases, online-only programs may cost less for enrolled students. In others, online classes are priced similar to their in-person counterparts.

Whether you opt to work and go to college at the same time, how to pay for college is likely a big question. Making a plan for financing your education is one step in figuring out how to take online classes while working full time.

There are options for different types of student loans, for example.

Completing the Federal Application for Federal Student Aid (FAFSA) can help you determine how much federal student aid (such as grants, scholarships, and federal loans) you are eligible to receive. You can also explore scholarship opportunities through universities, nonprofit organizations, and private foundations for additional funding.

Many students also borrow money through private loans to pay for advancing their education. These are available through banks, credit unions, and online lenders and often may come with flexible repayment plans, allowing you to find a loan that fits your budget and financial plan. (It’s worth noting that federal student loans come with baked-in benefits, like income-driven repayment or public service loan forgiveness, that are not guaranteed by private lenders).

The Takeaway

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.


Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

Can I work full-time and take online classes?

Yes, it is possible to work full-time and take online classes. Typically, those working full-time will take classes online on a part-time basis. Tactics that can make it easier to manage both of these responsibilities include finding an online program that is flexible enough to allow you to learn and study around your work obligations.

How to balance working full-time and school?

Some tips for balancing working full-time and school include creating a weekly schedule and using reminders, using time management apps, finding work with somewhat flexible hours, and setting realistic goals as you balance your job and studies.

What are the disadvantages of online classes?

The disadvantages of online classes can include the fact that not every program is available, that students may find it hard to engage and questions answered, and that opportunities to network, professionally and personally, are limited.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.


SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOISL-Q325-096

Read more
Aug
11
2025
Understanding How Income Based Repayment Works

Income-Driven Repayment Plans: Everything You Need to Know

By | Debt Payoff, Fresh Out of School, Student Loans, student_loan | No Comments

Key Points

•  Income-driven repayment plans base monthly student loan payments on income and family size, extending loan terms to 20 or 25 years.

•  Three income-driven repayment plans are currently available: Income-Based Repayment, Income-Contingent Repayment, and Pay As You Earn.

•  Income-driven repayment plans offer borrowers more flexibility in managing student loan debt.

•  Alternative repayment options for current borrowers include the Standard Repayment Plan, the Graduated Repayment Plan, and the Extended Repayment Plan.

•  Changes to all federal student loan repayment plans are expected due to recent legislation.

If you’re on the standard 10-year repayment plan and your federal student loan payments are high relative to your income, a student loan income-driven repayment plan may be an option for you.

Income-driven repayment bases your monthly payments on your income and family size. Due to recent legislation, your options for income-driven plans will be changing over the next few years.

Read on to learn about which repayment plans are currently available and what to expect in the near future.

What Is an Income-Driven Repayment Plan?

Income-driven student loan repayment plans were conceived to ease the financial hardship of government student loan borrowers and help them avoid default when struggling to pay off student loans.

Those who enroll in the plans tend to have large loan balances and/or low earnings. Graduate students, who usually have bigger loan balances than undergrads, are more likely to enroll in a plan.

The idea is straightforward: Pay a percentage of your monthly income above a certain threshold for 20 or 25 years. On the Income-Based Repayment (IBR) plan, you are then eligible to get any remaining balance forgiven.

Income-driven repayment plans are also the only repayment options that will help you qualify for the Public Service Loan Forgiveness program. (Standard Repayment also qualifies, but you probably wouldn’t have any debt left to forgive after 10 years.)

In mid-2025, about 12.3 million borrowers were enrolled in an income-driven repayment plan.


💡 Quick Tip: Often, the main goal of refinancing is to lower the interest rate on your student loans — federal and/or private — by taking out one loan with a new rate to replace your existing loans. Refinancing may make sense if you qualify for a lower rate and you don’t plan to use federal repayment programs or protections. Note that refinancing with a longer term can increase your total interest charges.

How Income-Driven Plans Differ from Standard Repayment?

So, how do income-driven repayment plans work? Do income-driven repayment plans accrue interest? And how do they compare to the Standard Repayment Plan?

Income-driven repayment adjusts your monthly student loan payment in accordance with your income and family size. It also extends your loan terms to 20 or 25 years. These plans are meant to provide relief for borrowers who have trouble affording payments on the standard plan. If your income changes, your monthly payments will change along with it.

Your loans do accrue interest on an income-driven plan, but the IBR plan offers some relief. Specifically, the government will pay any interest charges that your monthly payments don’t cover on subsidized loans for up to three years. However, you’re responsible for all the interest after this three-year period. You always have to pay the interest that accrues on unsubsidized loans.

By contrast, the Standard Repayment Plan doesn’t calculate your monthly payments based on your income. Instead, it gives you a fixed monthly payment based on a 10-year repayment term (or a 10- to 30-year term for Direct Consolidation Loans). By making this payment each month, you’ll pay off your full balance at the end of your term. The minimum payment on the Standard Plan is $50.

Federal student loans automatically go on Standard Repayment unless you apply for an alternative. If you prefer an income-driven plan, you can apply for it on the Federal Student Aid website.

Types of Income-Driven Repayment Plans

There are currently three income-driven repayment plans open to borrowers: Income-Based Repayment, Income-Contingent Repayment, and Pay As You Earn. The SAVE plan is no longer available, and a new plan called the Repayment Assistance Plan will be introduced in the summer of 2026. Here’s a closer look at each plan.

Pay As You Earn Repayment Plan (PAYE)

PAYE is currently available to borrowers, but it’s set to close and won’t be accepting new enrollments on or after July 1, 2027. Since PAYE will be shutting down, you’ll have until July 1, 2028 to switch to Income-Based Repayment or the new Repayment Assistance Plan.

To qualify for PAYE, you must be a new borrower as of October 1, 2007 and have received a Direct loan disbursement on or after October 1, 2011. Plus, you’re only eligible if your monthly payment on PAYE is less than what it would be on the Standard 10-year plan.

PAYE sets your monthly payments to 10% of your discretionary income and extends your loan terms to 20 years. Find out more about how PAYE compares to REPAYE (which is now closed).

Income-Based Repayment Plan (IBR)

While most of the current income-driven repayment plans will close in the coming years, IBR will remain open and available to current borrowers. If you’re currently on SAVE, PAYE, or ICR, you have the option of switching to IBR when (or before) your plan gets shut down.

On Income-Based Repayment, you’ll pay 10% of your discretionary income each month on a 20-year term if you first borrowed after July 1, 2014. If you borrowed before that date, your monthly payment percentage will be 15% and your repayment term will be 25 years.

IBR will forgive your remaining balance if you still owe money at the end of your term (after the Department of Education finishes updating its systems). PAYE and ICR no longer offer loan forgiveness, but you can get credit for your PAYE and ICR payments if you switch to IBR.

Income-Contingent Repayment Plan (ICR)

The Income-Contingent Repayment plan is the only income-driven option for borrowers with Parent PLUS loans (and you have to consolidate first). It sets your payments to 20% of your discretionary income and has a repayment term of 25 years. Note that the discretionary income calculation for ICR is different (and less generous) than the one used for the other income-driven plans.

Similar to PAYE, the deadline to enroll in ICR is July 1, 2027, and you have until July 1, 2028 to switch to IBR or RAP. Otherwise, you’ll automatically be moved to RAP. If you’re a parent borrower, you may want to enroll in ICR while you still can. Parent loans are not eligible for RAP, so you won’t have an income-driven repayment option if you miss the ICR enrollment deadline.

Income-Sensitive Repayment Plan

The Income-Sensitive Repayment plan is open to low-income FFEL borrowers. Direct loans, which replaced FFEL loans in 2010, are not eligible. On Income-Sensitive Repayment, your monthly payments will increase or decrease based on your annual income. You’ll make payments on your loans for up to 10 years.

SAVE Plan (Saving on a Valuable Education)

The SAVE plan is no longer available, but some SAVE borrowers remain in limbo as they wait to see what’s next for their student loans. Introduced by the Biden administration in 2023, the SAVE plan offered lower monthly payments and faster loan forgiveness than the other income-driven options.

It was struck down by legal challenges from Republican-led states, and SAVE borrowers were placed in an interest-free forbearance starting in the summer of 2024. Interest started accruing again on August 1, 2025, and the DOE is encouraging borrowers to switch to an alternative plan.

However, some SAVE borrowers are waiting it out to extend their forbearance as long as possible. Those who don’t make a move may end up in IBR and see their payments resume in mid-2026. SAVE will be eliminated completely by June 30, 2028.

RAP Plan (new Repayment Assistance Program)

The Trump administration’s “One Big Beautiful Bill” created the RAP program and will implement it starting in the summer of 2026. Existing borrowers will be able to access RAP or IBR, while new borrowers as of July 1, 2026 will only have RAP or the new Standard Repayment Plan.

While the existing IDR plans use discretionary income, the new RAP will base your payments on your adjusted gross income (AGI). Depending on your income, you’ll pay 1% to 10% of your AGI over a term that spans up to 30 years.

If you still owe money after 30 years, the rest will be forgiven. The government will cover unpaid interest from month to month, as well as make sure your loan’s principal goes down by at least $50 each month.

All borrowers are required to pay at least $10 per month on RAP. This plan may offer lower monthly payments than the current IDR options, but you could also pay more interest over the life of the loan due to the longer repayment term.

How Income-Based Student Loan Repayment Works

In general, borrowers qualify for lower monthly loan payments if their total student loan debt at graduation exceeds their annual income.

To figure out if you qualify for a plan, you must apply at StudentAid.gov and submit information to have your income certified. The monthly payment on your income-driven repayment plan will then be calculated. If you qualify, you’ll make your monthly payments to your loan servicer under your new income-based repayment plan.

You’ll generally have to recertify your income and family size every year or allow the DOE to access your tax information and recertify for you. Your calculated income-based payment may change as your income or family size changes.


💡 Quick Tip: When rates are low, refinancing student loans could make a lot of sense. How much could you save? Find out using our student loan refi calculator.

Serious savings. Save thousands of dollars
thanks to flexible terms and low fixed or variable rates.

Pros and Cons of Income-Driven Repayment

Pros

•   Borrowers gain more affordable student loan payments.

•   Any remaining student loan balance is forgiven after 20 or 25 years of repayment on the Income-Based Repayment plan.

•   An economic hardship deferment period counts toward the 20 or 25 years.

•   The plans provide forgiveness of any balance after 10 years for borrowers who meet all the qualifications of the Public Service Loan Forgiveness (PSLF) program.

•   The government pays all or part of the accrued interest on some loans in some of the income-driven plans for a period of time.

•   Low-income borrowers may qualify for payments of zero dollars, and payments of zero still count toward loan forgiveness. On the new RAP option, the minimum monthly payment will be $10.

•   The IBR plan and new RAP plan offer some interest benefits if your monthly payments don’t cover your full interest charges.

Cons

•   Stretching payments over a longer period means paying more interest over time.

•   Forgiven amounts of student loans are free from federal taxation through 2025, but usually the IRS treats forgiven balances as taxable income (except for the PSLF program).

•   Borrowers in most income-based repayment plans need to recertify income and family size every year.

•   If a borrower gets married and files taxes jointly, the combined income could increase loan payments.

•   The system can be confusing to navigate, especially with all the legal challenges and recent legislation.

Other Student Loan Repayment Options

If you’re wondering, “Is an income-driven plan good for me?” consider the fact that income-driven repayment plans aren’t your only option for paying back student loans. Here are a few alternatives that are currently available.

Standard Repayment Plan

The Standard Repayment Plan involves fixed monthly payments over 10 years. Starting in the summer of 2026, the new Standard Plan will have fixed payments over a term that’s based on your loan amount. Your term will be 10 years if you owe less than $25,000 and go up to 25 years for balances over $100,000.

Graduated Repayment Plan

The Graduated Repayment Plan spans 10 years for most loans, but it can go from 10 to 30 years for consolidation loans. On Graduated Repayment, your monthly payments start out low and increase every two years. Like the current Standard Plan, you’ll be out of debt at the end of your term. However, you’ll end up paying more interest on this graduated plan. Graduated Repayment may be a good fit for borrowers whose income is low starting out but expect it to increase over time.

Extended Repayment Plan

Extended Repayment gives you 25 years to pay back your loans, but you must owe more than $30,000 and have borrowed after October 7, 1998. You can choose fixed payments or graduated payments. Unlike IBR, there’s no loan forgiveness at the end of the Extended Plan. Your monthly payments will go down when you extend your term, but you’ll pay more interest overall.

How to Qualify for Income-Driven Repayment

You can apply for income-driven repayment on the Federal Student Aid website. The process typically takes about 10 minutes. Here’s more on how to change your student loan repayment plan to an income-driven one.

Required Documentation

When you apply for an IDR plan, you can upload documentation verifying your income or allow the DOE to access your tax information and import it into your application. Along with sharing your income, you’ll need to provide your mailing address, phone number, and email. If you’re married, you’ll also provide your spouse’s financial information.

Annual Recertification Process

Every year, you have to recertify, or update, your income and family size so your loan servicer can adjust your monthly payments accordingly. This recertification is required even if your income or family size hasn’t changed.

If you fail to recertify your plan, your servicer will no longer base your payments on your income. Instead, you’ll pay the amount you would on the standard 10-year plan. If you fail to recertify IBR, you’ll have the added consequence of interest capitalization, meaning your interest charges will be added to the principal balance of your loan.

You can recertify your plan on the Federal Student Aid website by uploading documentation of your income. Alternatively, you can allow the DOE to access your federal tax information and automatically recertify your plan for you.

If you don’t give your consent for this (or aren’t eligible for auto-recertification), you’ll have to manually recertify your plan each year.

The Takeaway

Income-driven repayment can offer relief if you’re struggling to afford your monthly payments. These plans adjust your monthly student loans bills based on your income while giving you a lot more time to pay back your debt. Plus, income-driven plans (and the current Standard Plan) are the only plans that qualify for PSLF. A downside of IDR plans, however, is that you’ll likely pay more interest with an extended term.

Your options for IDR will also be changing due to recent legislation from the Trump administration. Most of the current plans will be shut down, leaving only Income-Based Repayment for current borrowers or the new Repayment Assistance Plan. For those who borrow after July 1, 2026, the only income-driven plan option will be the Repayment Assistance Plan. Staying informed about these changes will help you decide which income-driven repayment plan is best for you.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

FAQ

Is income-based repayment a good idea?

For borrowers of federal student loans with high monthly payments relative to their income, income-based repayment can be a good idea. Just be aware that your options will be changing in the coming years.

What is the income limit for income-based student loan repayment?

Some income-driven repayment plans require that your monthly payments be less than on the standard 10-year plan. You’ll generally meet this guideline if your student loan debt is higher than your discretionary income or makes up a big portion of your income.

What are the advantages and disadvantages of income-based student loan repayment?

The main advantage is lowering your monthly payments, with the promise of eventual loan forgiveness on the IBR plan if all the rules are followed. Plus, income-driven plans are essentially the only ones that qualify for PSLF. A disadvantage is that you have to wait for 20 or 25 years depending on the plan you’re on and how much you owe. You’ll likely also pay more interest on this longer term.

How does income-based repayment differ from standard repayment?

With the standard repayment plan, your monthly payments are a fixed amount that ensures your student loans will be repaid within 10 years. Under this plan, you’ll generally save money over time because your monthly payments will be higher. With income-driven repayment, your monthly loan payments are based on your income and family size. These plans are designed to make your payments more affordable. If you still owe a balance after 20 or 25 years on IBR, the remaining amount is forgiven.

Who is eligible for income-based repayment plans?

With the PAYE and IBR plans, in order to be eligible, your calculated monthly payments, based on your income and family size, must be less than what you would pay under the standard repayment plan. Under the ICR plan, any borrower with eligible student loans may qualify. Parent PLUS loan borrowers are also eligible for this plan if they consolidate their parent loans first.

How is the monthly payment amount calculated in income-based repayment plans?

With income-based repayment, your monthly payment is calculated using your income and family size. Your payment is based on your discretionary income, which is the difference between your gross income and an income level based on the poverty line. The income level is different depending on the plan. For IBR, your monthly payment is 10% or 15% of your discretionary income, depending on when you borrowed.

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.


SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SOSLR-Q325-013

Read more
Aug
11
2025
Pros and Cons of Using Personal Loans to Pay Off Student Debt

Is it Smart to Use a Personal Loan to Pay Off Student Loans?

By | Debt Payoff, Fresh Out of School, Student Loans, student_loan | No Comments

Student loan debt can be overwhelming, especially as interest builds and payments drag on for years after graduation. For borrowers seeking relief, one strategy that sometimes comes up is using a personal loan to pay off student loans. On the surface, it may seem like a simple debt-swap — replace one loan with another and, ideally, secure better terms. But is it a smart idea?

While personal loans can be used for many things, they are generally not the best option for paying off student loans. Many lenders prohibit using personal loans for educational costs (including SoFi), which includes paying off student loans. Even if you can find a lender that does allow it, there are pros and cons to using a personal loan to pay off your student loan balance. Here’s what you need to know.

Key Points

•   Many lenders do not allow you to use a personal loan for paying off student loans.

•   Personal loans often have higher interest rates and shorter terms than student loans.

•   A lower interest rate can sometimes be secured, potentially reducing overall debt costs.

•   Federal protections like deferment and forgiveness are lost when using a personal loan.

•   Other repayment options, such as federal consolidation loans, student loan refinancing, and income-driven repayment plans, may be a better fit.

Personal Loans vs. Student Loans

At first glance, personal loans and student loans might seem similar. Both provide a lump sum of money up front, require you to pay it back in monthly payments, and charge interest. But the structure, purpose, and protections of each are different.

Student loans are specifically designed to help finance education. They often feature relatively low interest rates and deferred repayment while in school. In the case of federal student loans, they also offer unique benefits like income-driven repayment (IDR) plans, forbearance during hardship, and potential forgiveness programs.

Personal loans, by contrast, are loans that can be used for virtually any legal purpose. Common uses for personal loans include home renovations, unexpected emergencies, medical expenses, major events like weddings, and debt consolidation (when you combine multiple high-interest debts into a single loan with a potentially lower interest rate).

Personal loans tend to carry shorter repayment terms (often two to seven years), and their interest rates can vary widely based on your credit score. Importantly, they don’t offer any of the protections or flexible repayment options that federal student loans provide.

Note: While SoFi personal loans cannot be used for post-secondary education expenses, we do offer private student loans with great interest rates.

Can You Use a Personal Loan to Pay Off Student Loans?

It depends. While it may technically be possible to use a personal loan to pay off your student loans, either federal or private, many lenders do not allow you to use the proceeds of a personal loan for this purpose.

This restriction exists largely due to regulatory and risk concerns. Education-related lending in the U.S. is heavily regulated, and lenders that want to offer student loan refinancing must meet specific legal and compliance standards. To avoid those complications, many personal loan providers choose not to allow their products to be used for anything related to student loans or education.

If you are unsure if a lender will allow you to use the funds to pay off your student debt, it’s a good idea to let them know this is your intent at the outset. This could be a reason why you would be denied for a personal loan. However, if you use the proceeds of a personal loan for a prohibited use, you’ll be violating the loan agreement and might face legal consequences or be required to repay the full amount of the loan immediately.

So while using a personal loan to pay off student debt is theoretically possible, finding a lender that allows it — and does so under favorable terms — could be a major challenge.

Private vs. Federal Student Loans

If you do happen to find a lender that permits this use, it’s crucial to consider what kind of student loans you’re dealing with.

Private student loans often come with fewer borrower protections and may carry higher interest rates than federal loans. If your credit is excellent and the new personal loan offers a better rate and shorter term, using it to pay off private loans could make financial sense — if permitted by the lender.

Federal student loans, however, come with significant advantages that you will lose if you switch to a personal loan. These include access to IDRs, deferment and forbearance options, and the possibility of forgiveness through Public Service Loan Forgiveness (PSLF). Giving up these benefits for a loan that’s less flexible could be risky.

Pros and Cons of Using a Personal Loan to Pay off Student Loans

If you can find a lender that allows it, here are some pros and cons of using a personal loan to pay off student debt.

Pros

•  Potentially lower interest rate: If you took out private student loans with a relatively high rate and currently have strong credit, you may be able to qualify for a personal loan with a lower rate than your student loans.

•  Predictable payments: If you have a private student loan with a variable interest rate, using a fixed-rate personal loan to pay it off will provide you with a fixed monthly payment, which can make budgeting simpler.

•  Faster repayment timeline: Because personal loans usually have shorter terms, using a personal loan to pay off your student debt could help you eliminate your student loan debt more quickly — provided you can afford the higher payments.

Cons

•  Loss of federal protections: If you’re paying off federal student loans, you’ll forfeit benefits like IDR plans, deferment, forbearance, and forgiveness opportunities, which can provide a valuable safety net.

•  Higher monthly payments: Because personal loans generally have shorter repayment terms than student loans, your monthly payments may be higher, even if the interest rate is lower.

•  No tax benefits: You can generally deduct student loan interest, up to $2,500, from your taxable income each year. Interest on personal loans, on the other hand, doesn’t qualify for a similar tax break.

Other Ways to Pay Off Student Loans

If using a personal loan to pay off your student loans isn’t feasible or cost-effective, here are some other student loan repayment options to consider.

Student Loan Refinancing

Student loan refinancing involves taking out a new student loan from a private lender to replace one or more existing loans, ideally at a lower interest rate. Unlike personal loans, there are numerous options available when it comes to finding a lender that will refinance your student loans.

Be aware, though: Refinancing federal loans with a private lender will still eliminate federal protections. Also keep in mind that refinancing student loans for a longer term can increase the overall cost of the loan, since you’ll be paying interest for a longer period of time.

Recommended: Online Personal Loan Calculator

Income-Driven Repayment Plans

If you have federal loans and your payments are unaffordable, you may qualify for an IDR plan. Generally, your payment amount under an IDR plan is a percentage of your discretionary income and remaining debt may be forgiven after decades of consistent repayment.

Keep in mind that under the new domestic policy bill, many existing federal IDR plans will close by July 1, 2028. After those plans are eliminated, borrowers whose loans were all disbursed before July 1, 2026, can choose between the Repayment Assistance Plan (RAP) and Income-Based Repayment (IBR) plan.

Federal Loan Consolidation

Federal loan consolidation allows you to combine multiple federal loans into a single loan with a weighted average interest rate. Consolidation can simplify repayment and may help you qualify for certain forgiveness programs, but you won’t necessarily save on interest.

Loan Rehabilitation

If your federal loans are in default, loan rehabilitation allows you to make a series of consecutive, agreed-upon payments (usually nine over ten months) to bring your loan current. This also removes the default status from your credit report and restores eligibility for federal benefits. To begin the loan rehabilitation process, you must contact your loan holder.

Currently, borrowers can only use a rehabilitation agreement to remove their loans from default once. Starting July 1, 2027, borrowers will be able to use rehabilitation to exit default twice.

The Takeaway

While the idea of using a personal loan to pay off student loans might seem appealing, it may not be a viable nor an advisable solution. Many lenders prohibit using personal loan funds for education-related expenses, including paying off student loans. Even if you find a lender that allows it, the trade-offs can be significant, especially if you’re dealing with federal student loans.

Instead, you might explore options designed specifically for managing student debt, such as student loan refinancing, consolidation, or enrolling in an income-driven repayment plan. These programs may offer benefits that are better fit to your situation.

Debt repayment strategies are not one-size-fits-all. It’s important to carefully evaluate your options — and read the fine print — before making a move that could impact your financial future for years to come.

While SoFi personal loans cannot be used for post-secondary education expenses, they can be used for a wide range of purposes, including credit card consolidation. SoFi offers competitive fixed rates and same-day funding for qualified borrowers. See your rate in minutes.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.


SoFi’s Personal Loan was named a NerdWallet 2026 winner for Best Personal Loan for Large Loan Amounts.

FAQ

Can you consolidate student loans with a personal loan?

Technically, you might be able to use a personal loan to pay off student loans, but it’s not true consolidation — and many lenders don’t allow it. Personal loan lenders will often explicitly prohibit using loan funds for education-related expenses, including paying off existing student loans. Even if permitted, this route eliminates federal protections like income-driven repayment and forgiveness programs. Alternatives such as federal consolidation or student loan refinancing can be safer and more effective ways to manage or streamline student loan repayment.

What are the risks of using a personal loan to pay off student debt?

Using a personal loan to pay off student debt carries several risks, starting with the fact that many lenders prohibit this use altogether. If you find a lender that allows it, keep in mind that using a personal loan to pay off federal student loans will mean losing federal benefits like income-driven repayment, deferment, forbearance, and loan forgiveness. Personal loans also typically have higher interest rates and shorter repayment terms than student loans, which could increase your monthly payments.

Does paying off student loans with a personal loan hurt your credit?

Many personal loan lenders don’t allow you to use a personal loan to pay off student loans. But if you can find one that does, paying off student loans with a personal loan may impact your credit in several ways.
Initially, your credit could dip temporarily due to the new account and hard inquiry. However, if you make regular, on-time payments, the loan could have a positive influence on your credit profile over time. On the other hand, missed payments could negatively affect your credit. It’s important to consider lender rules and your ability to manage repayment before using a personal loan to pay off student loans.

Are there better options than personal loans for student debt?

Yes, there are a number of options that may be better than personal loans for paying off student loans. Federal consolidation loans can combine multiple federal loans into one, simplifying repayment. Income-driven repayment plans for federal loans adjust payments to your earnings, making them more manageable. Refinancing with a private lender might reduce rates and monthly payments Additionally, some employers offer student loan repayment assistance, which can significantly ease the financial burden.

Can using a personal loan to pay student loans disqualify you from forgiveness programs?

Yes. If you pay off your federal student loans with a personal loan, you’ll forfeit federal benefits like income-driven repayment, deferment, forbearance, and loan forgiveness. The same is true if you refinance your federal student loans with a private student loan lender.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.


Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SOPL-Q325-011

Read more
Close modal

See what SoFi can do for you and your finances.

Select a product below and get your rate in just minutes.

Student Loan
Refinancing

Personal
Loans

Online
Investments

Other

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or other eligible status, be residing in the U.S., and meet SoFi's underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates reserved for the most creditworthy borrowers. If approved, your actual rate will be within the range of rates at the time of application and will depend on a variety of factors, including term of loan, evaluation of your creditworthiness, income, and other factors. If SoFi is unable to offer you a loan but matches you for a loan with a participating bank, then your rate may be outside the range of rates listed above. Rates and Terms are subject to change at any time without notice. SoFi Personal Loans can be used for any lawful personal, family, or household purposes and may not be used for post-secondary education expenses. Minimum loan amount is $5,000. The average of SoFi Personal Loans funded in 2023 was around $33K. Information current as of 2/26/24. SoFi Personal Loans originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org). See SoFi.com/legal for state-specific license details. See SoFi.com/eligibility for details and state restrictions.

✝ To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

©2026 Social Finance, LLC All rights reserved.
TLS 1.2 Encrypted
Equal Housing Lender