Most college graduates leave school with some level of student debt.
In fact, around 68 percent of college seniors who graduated from public and private nonprofit colleges in 2015 borrowed student loans, according to data from The Institute for College Access and Success, a nonprofit that advocates for affordable higher education.
If a college grad borrowed student loans to help pay for his or her education, it’s important to understand how much is owed in order to develop a repayment strategy.
[Read: Know Who’s Who in the Student Loan World.]
For federal loans, repayment usually begins after the six-month grace period from the date of graduation. The grace period gives borrowers time to develop a plan and gain employment to repay their loans. Grace period policies can vary for private loans, so the Student Loan Ranger recommends these borrowers to inquire with their lenders directly to find out when repayment begins.
It’s important to understand that what was originally borrowed is likely not the same amount now owed. It depends on the type of loan and the interest rate. Many students don’t pay down the interest that’s accumulating while they’re in school. Unpaid accrued interest is added to the principal, and the interest is then calculated based on a new, higher balance.
[Read: How the Trump Administration May Reform Student Loans.]
For borrowers who are trying to figure out how much they owe and who to contact about their student loan balances, here are a few tips.
Federal loan status can be viewed on the National Student Loan Data System. There are tools available to help borrowers determine what is owed. In the case of federal loans, the U.S. Department of Education manages a database commonly referred to as the NSLDS.
The system receives data from schools, agencies that guarantee the loans, the direct loan program and other Department of Education programs. NSLDS provides a centralized view of federal loans and grants; this helps borrowers track the balances of their loans.
The database not only provides the amount owed on federal loans, but it also shows the type of loan, original balance of each loan, interest rate, payment status and the loan servicer. Student loan servicers are companies, such as Navient or Nelnet Inc., that maintain loans for the government and perform administrative tasks, like collecting payments.
The system also provides information about any grants a borrower may have received during his or her time as a student.
[Read: Why Repaying Federal Student Loans on a Credit Card Is a Bad Idea.]
Borrowers can visit the NSLDS website and log in using their Federal Student Aid ID username and password. If the borrower doesn’t have one or doesn’t know his or her FSA ID, it can quickly be created or retrieved on the NSLDS website.
Access is limited to authorized users. Borrowers should never share their login credentials with anyone. While the NSLDS is a great tool for borrowers to gain information on federal student loans, keep in mind it doesn’t list information on private student loans.
Private loans appear on credit reports. To determine how much is owed on private student loans, borrowers can look at a copy of their credit report. Credit reports provide balances for both federal and private loans.
Credit reports typically list student loan balances, the loan servicers and the amount borrowed. By going to AnnualCreditReport.com, borrowers can get a free report once every 12 months from the three main credit reporting agencies: Equifax, Experian and TransUnion.
Additionally, borrowers should be able to get the balance on private student loans directly from their lender, or their school may also be able to help track down this information.
Surprisingly, many student loan borrowers don’t know how much they owe. However, using the NSLDS for federal loans, and credit reports for federal and private will provide this information.
Once the balance is known for student loan repayment, the next step is to develop a repayment plan. The Student Loan Ranger recommends paying off student debt as quickly as possible so that it doesn’t hinder financial goals, such as saving for retirement or buying a home.
If help is needed, there are resources available, such as nonprofit student loan counseling, student loan repayment calculators or loan servicers’ customer services. These resources can help guide borrowers to develop a repayment strategy.
More from U.S. News
10 Advantages of Federal Student Loans
Student Loan Forgiveness: The Complete Guide
The Truth About Student Loan Bankruptcy Discharge
How to Find How Much You Owe in Student Loans originally appeared on usnews.com
