When you’ll start repaying loans depends on the type of loan you choose. Some require you to start paying them back while you’re still in school, while others start after you graduate. But all loans must be repaid.

Don’t be fooled by federal maximum loan amounts. Those are the maximum limits for all borrowers and aren’t related to your own personal earning potential. The maximum amount you’re eligible to borrow may be more than you’re able to repay. If you aren’t able to repay your education loans, you could seriously damage your credit rating. That could make it hard to get other types of consumer loans.

Loan exit counseling

When you’re about to graduate, or if you drop below half-time enrollment, you’ll be asked to complete loan exit counseling. This is an interactive tool that will give you the information you need to know about repaying your federal student loans.

We’ll send you email to let you know how to get started with your exit counseling.

Exit counseling for a Federal Perkins Loan

Federal Perkins Loans are managed by University Collections and Loan Services, and the exit counseling process is different.

If you don’t pay back a loan according to the terms of the Master Promissory Note (MPN) you signed, you may default on the loan. Default occurs if you don’t pay on time or if you don’t comply with other terms of your MPN.

What happens if you default?

If you default on a federal loan, the government may take some serious actions against you. You may:

• Lose wages and tax refunds, which will be applied toward your unpaid loans
• Lose eligibility for future student aid
• Be unable to get a home, car, or other loan
• Lose job opportunities or be unable to get a professional license
• Damage your credit rating when your loan is reported to the national credit bureaus

What is IU Bloomington’s default rate?

Very few IU Bloomington students default on their student loans. The average default rate at IU Bloomington is 4.0 percent, which is lower than national default rates.