When Do You Have to Start Paying Back Student Loans?

By Austin Kilham · July 26, 2023 · 8 minute read

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When Do You Have to Start Paying Back Student Loans?

Figuring out when you have to start paying back student loans can be a bit tricky, but in 2023 it’s more complicated than usual. A pause on all federal student loan payments has been in effect since 2020, but that pause has come to an end.

For new grads, most federal student loans have a six-month grace period after you finish school, during which borrowers don’t have to make payments. The payback terms on private student loans are set by individual lenders, which may or may not offer a grace period.

Whether you’re a new grad or a federal student loan borrower wondering when your paused payments will resume, read on to find out when you have to start paying back your student loans.

Student Loan Payment Pause Ends

In March 2020, at the beginning of the Covid-19 pandemic, the federal government ordered the suspension of payments, interest, and collections on most federally held student loans. Three years later, borrowers will restart making loan payments in the fall of 2023.

When the time comes, borrowers should receive a billing statement from their loan servicer at least 21 days before their payment is due. The statement will provide the latest information on payment due dates, monthly amount, and interest accrued.

What else you can do: Make sure your contact information is up-to-date on your loan servicer’s website and in your StudentAid.gov profile. And to refresh your memory on all things student loans, read our summary of the basics of student loans.

What Is a Student Loan Grace Period?

A grace period is the time you’re given after graduation before you have to start paying back your student loans. The federal government and many private lenders understand that you might not find a steady job straight out of college.

Both Direct Subsidized and Unsubsidized Loans have a grace period. Direct PLUS loans for graduate students and parents don’t have a grace period. Make sure you understand which loan you have so you’re financially ready to start making payments.

While the grace period gives you time to find a job before you have to start making payments, it’s important to understand that unsubsidized federal student loans will continue to accrue interest during the grace period.

Usually, at the end of the grace period, the interest is capitalized onto the principal (or original amount borrowed). This becomes the new value of the loan, and interest continues to accrue based on this new value. However, new federal regulations will eliminate interest capitalization when borrowers first enter repayment.

Recommended: How Much Money to Budget for Student Loans

Federal vs Private Loans: Key Differences

There are two main types of student loans: private student loans and federal student loans. Private student loans are borrowed from a bank, credit union, or another lender. Federal loans are backed by the U.S. Department of Education. Important differences between the two include:

•   Only federal student loans were eligible for the payment pause.

•   Fixed interest rates on federal student loans are generally lower than for private loans.

•   Only federal student loans are eligible for income-driven repayment plans, deferment and forbearance, and federal loan forgiveness.

When to Start Paying Federal Student Loans

As noted above, both direct subsidized and unsubsidized loans offer a six-month grace period where loan payments are not required after a student graduates. Here’s how the payment pause may affect your grace period:

•   Students who graduated in December 2022 or earlier will make their first payment after October 1, 2023.

•   Students who graduated in June 2023 will make their first loan payment in December.

When to Start Paying Private Student Loans

Some private student loans operate with a six-month grace period, similar to federal student loans. But not all. If you have a private student loan, check your loan terms to see if you have a grace period.

If you’re looking to take out a private student loan with a grace period, consider reviewing different lenders to see who has the best terms. Unlike federal student loans, interest rates for private student loans vary based on individual factors including your credit history. Because of this, your interest rate might be higher than it would be with federal loans.

Recommended: Private Student Loans Guide

Can You Get More Time Before Paying Back Student Loans?

If you’ve already graduated and you’re having trouble finding a job in your field, you might be stretching your finances as thin as they go. Even your student loan repayments might not get priority. Before you let late payments get the best of you, consider what options are available.

It may be possible to talk to the loan servicer about delaying your payments a little longer. Your lender doesn’t want you to be late either, and might be willing to work with you.

Extended Deferment or Forbearance

Borrowers with federal student loans might qualify for student loan deferment or forbearance, which allow you to temporarily pause payments. Keep in mind that interest may still accrue while your loans are in deferment or forbearance, depending on the type of loan you hold. You’ll be responsible for that interest regardless of when you start making your payments.

The start date of those repayments isn’t the only thing you should be concerned with. If you have student loans, lowering your payment amount is probably on your mind as well. Not sure what your monthly payment is? Use our student loan calculator to estimate your student loan payments.

Can You Lower Your Student Loan Payments?

Depending on the type of loans you have, there are a few different ways you can lower your student loan payments.


If you have many different federal student loans, you might want to consider student loan consolidation. Consolidating your existing loans with a Direct Consolidation Loan means combining all of your federal loans into a single loan and potentially lengthening the term so your payments go down. A longer term, however, means paying more interest over the (now longer) life of your loan.

Your new interest rate will be the weighted average of all your federal loans combined, rounded up to the nearest eighth of 1%, which means consolidation might not lower your interest rate.


Refinancing your student loans is similar to consolidation. However, a refinanced loan uses your credit history to determine your interest rate. Ideally, refinancing will lead to a lower rate. It’s important to note that refinancing student loans forfeits protections that come with federal student loans, like forbearance and income-driven repayment plans.

It’s also possible to lengthen or shorten your loan term. Refinancing can be done with private student loans, federal student loans, or both. Just remember that lengthening the loan term may result in paying more in interest over the life of the loan.

For more on this option, read our take on the advantages of refinancing student loans.

Income-Driven Repayment Plans

If you have federal student loans and have a lower income, you might want to look into Income-Driven Repayment plans. There are a few different IDR options that vary based on your income and family size. And recent changes by the Biden Administration make the plans an even better deal for borrowers.

All IDR plans forgive the remaining balance on your loans either 20 or 25 years after you begin paying the loan back. This could be an option to consider if you are a recent grad. Note that while the remaining balance is forgiven at the end of an IDR loan term, that amount may be considered taxable income by the IRS.

What Happens if You Don’t Start Paying Back Student Loans?

If you don’t start paying back your student loans, you can face some pretty serious financial consequences. Your loan will become delinquent after the first day of missed payments. Once you’re 90 days late making a payment on your federal loans, your loan servicer will report the delinquency to the credit reporting bureaus and your credit score will take a hit.

If you have a private student loan, your lender may report you to the credit reporting bureaus after just 30 days. A lower credit score can make it more difficult to secure credit and loans in the future, and if you do get a loan, it might come with less favorable terms and a higher interest rate.

Student Loan Default

After 270 days, your federal loans will enter default. Private loans may default after 120 days, and Federal Perkins loans can enter default immediately after you miss a payment.

Once you’re in default, your credit will take another hit. You might also be subject to having your wages garnished (though the rules on this are different when it comes to federal vs. private student loans).

In addition to wage garnishment and damage to your credit, you may also experience the following negative consequences:

•   Late fees. For example, federal loans that are 30 days late may encounter late fees of 6% of the amount due.

•   Loss of eligibility for loan deferment or forbearance once you default on federal loans.

•   No longer able to choose your repayment plan for federal loans.

•   The government may withhold your tax refund if you fail to pay federal loans.

•   Loss of eligibility for financial aid.

The Takeaway

The payment pause on federal student loans has ended. If you graduated in or before December 2022, your first federal student loan payment will be due sometime after October 1. If you graduated in June 2023 or later, your first payment will be due after six months. Your loan servicer will provide you with a billing statement at least 21 days before your first payment is due. If you can’t afford to resume your monthly payments, federal loan holders have options: deferment, an income-driven repayment plan, or refinancing. Some private student loans also offer grace periods; check with your loan servicer to find out.

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.

SoFi Student Loan Refinance
If you are a federal student loan borrower, you should consider all of your repayment opportunities including the opportunity to refinance your student loan debt at a lower APR or to extend your term to achieve a lower monthly payment. Please note that once you refinance federal student loans you will no longer be eligible for current or future flexible payment options available to federal loan borrowers, including but not limited to income-based repayment plans or extended repayment plans.

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