Please note: ELFI will have adjusted holiday hours on 12/4, 12/28, and 12/31/24. Please click the button the learn more.

Learn More
Knowledge Hub / Can You Change Your Student Loan Repayment Plan?
Can You Change Your Student Loan Repayment Plan?

Can You Change Your Student Loan Repayment Plan?

Living with Student Loans
ELFI | September 29, 2023
Can You Change Your Student Loan Repayment Plan?

If your life circumstances have changed, you might consider changing your student loan repayment plan to suit your situation better. This is especially true if you’re struggling financially or you’ve had a recent financial windfall. Fortunately, changing your payments may be possible, though there are differences between federal and private loans.  Besides the type of student loans you have, your circumstances may also impact your ability to modify your student loan payments or terms. Here’s what to know.

How To Change Your Student Loan Repayment Plan

With federal student loans, you can modify your payments in several ways, including opting for an income-driven repayment plan or consolidating multiple loans into one with a Direct Consolidation Loan. There are currently four options for income-driven repayment with federal student loans: 

The process for changing your payments may vary depending on which option you choose, but here’s some general guidance on possible steps:

You’ll likely have fewer options for modifying your payments if you have private student loans. You can refinance multiple loans into one to simplify monthly payments. However, the process for refinancing will vary by lender. 

How Often Can You Change Your Student Loan Repayment Plan?

You can change your federal student loan repayments anytime, which is helpful if your circumstances change. While you may not get higher interest rates when you modify your repayment plan, extending your term could result in higher interest payments over time. So keep that in mind if you’re considering a change.

When To Consider Changing Your Repayment Plan

You can change your repayment plan in several cases, including the following. 

You Are Struggling To Repay Your Loan

If you’re experiencing temporary financial hardship, exploring new repayment plan options is worth exploring. Both federal and private student loans may offer some flexibility in the case of financial hardship. Opting for a modified repayment plan is often better than missing payments and dealing with the consequences of not paying your student loans

You Have A New Job Or Increased Income

By contrast, if your income has increased due to a new job or side hustle, you may want to make larger student loan payments to save on interest. Increasing monthly payments could help you repay your student loans earlier than expected. 

Your Life Circumstances Have Changed

If your life circumstances have changed, you may need to reassess your budget and modify your student loan payments accordingly. For instance, when you get married or have a child, you should review your budget to determine if you could benefit from reallocating some funds.

You Are Returning To School

Perhaps you’ve decided to further your education and are returning to school at least half-time. In this case, deferring some of your federal student loans may be possible.  Deferment could help pause your payments until you graduate, and it’s especially good if you have Direct Subsidized loans, which don’t accrue interest during deferment periods. Direct Unsubsidized loans do accrue interest during deferment, so this is something to consider if you’d like to pause your payments while in school temporarily. 

You Could Save By Refinancing

If you have private student loans and your rate is high with your existing servicer or want a new loan term, consider refinancing with a different private lender. Refinancing your student loan has several benefits, including lower monthly payments or a lower interest rate. 

Consider Refinancing Your Student Loan With ELFI

ELFI offers student loan refinancing that could help you lower your payments or pay off your student loans faster. If you’re struggling or your life’s circumstances have changed, refinancing can give you a new repayment option that better suits your needs. Learn more about student loan refinancing with ELFI.