Regions enables you to save money on education loans in the following ways:
Federal Stafford Loans
**Use automatic debit and save You may qualify for a 0.25 percentage point interest rate reduction when you make payments on your federal loans by automatic debit.
Parent PLUS Loans
**Use automatic debit and save You may qualify for a 0.25 percentage point interest rate reduction when you make payments on your federal loans by automatic debit.
Graduate PLUS Loans
**Use automatic debit and save You may qualify for a 0.25 percentage point interest rate reduction when you make payments on your federal loans by automatic debit.
Prepay
One sure way to cut down on loan costs is to prepay the loan. This means paying off a portion or the entire loan before payment is due. This reduction in loan balance means you pay less interest over the life of the loan.
Tax Related Benefits
The Federal Government has tax related benefits that aid in paying for college. Find out more about Student Loan Interest Deduction and other Tax Benefits below .
Repayment options
*Regions, along with our service provider, Sallie Mae, offers a choice of repayment options, so borrowers can choose the one that best meets their needs. We do accept electronic payments and reward customers for paying on time.
Standard Repayment
Standard repayment provides level monthly payments that cover accruing interest and a portion of principal.
Graduated Repayment
Graduated repayment allows Stafford, PLUS, and many of our private student loan borrowers to make reduced payments that may be as low as interest only for up to four years followed by standard payments of principal and interest for the remaining repayment term.
Income-sensitive Repayment
Explore income-sensitive repayment as an option. Your payment must cover at least monthly accruing interest. You determine the percentage of your monthly payment: between 4% and 25% of your monthly gross income.
*You have to apply annually for an income-sensitive repayment plan.
*You can prepay at any time without penalty.
Because the loan is repaid more slowly, your total interest costs may be higher over the life of your loan.
Extended Repayment
Make monthly payments that are as low as interest-only for the first few years or monthly payments of principal and interest. With extended repayment, you may have up to 25 years to repay your federal student loans.
Remember: By lengthening your repayment term, you can lower your monthly payment, but the overall loan cost will be higher.
Deferment Options
Your deferment options may vary, depending on what kind of loans you have.
Stafford and Perkins Loans
Principal and interest payments may be deferred while the borrower is:
- Attending school at least half-time.
- Unemployed (up to three years).
- Studying in an approved graduate fellowship or rehabilitation program for the disabled.
- Experiencing economic hardship (up to three years).
Parent PLUS Loans
Parent PLUS deferment options are based on the parent borrower's eligibility--for example, if the parent is unemployed, not the student on whose behalf the parent took out the loan. Principal and interest payments may be deferred while the parent borrower is:
- Attending school at least half-time.
- Unemployed (up to three years).
- Studying in an approved graduate fellowship or rehabilitation program for the disabled.
- Experiencing economic hardship (up to three years).
Graduate PLUS Loans
Principal and Interest payments may be deferred while the borrower is:
- Attending school at least half-time.
- Unemployed (up to three years).
- Studying in an approved graduate fellowship or rehabilitation program for the disabled.
- Experiencing economic hardship (up to three years).
Eligibility for Interest Subsidy during Deferment:
- Consolidation loan applications received on or after January 1, 1993, and before August 10, 1993.
- Applications received on or after August 10, 1993, and before October 7, 1998, if the consolidation loan includes only subsidized Federal Stafford Loans, subsidized Federal Consolidation Loans or Federally Insured Student Loans.
- Applications received on or after October 7, 1998, on the portion of the consolidation loan that represents subsidized Federal Stafford, subsidized Federal Consolidation Loans or Federally Insured Student Loans.
If you have trouble making your education loan payments, contact Regions immediately. You may qualify for a deferment, forbearance, or other form of payment relief. And it's important to take action before you incur late fees.
- Deferment : You have a right to defer repayment for certain defined periods. A deferment is a temporary suspension of loan payments for specific situations such as returning to school, unemployment, disability, or military service.
- Forbearance : Forbearance is a temporary postponement or reduction of payments for a period of time, as you and the lender or holder of your loan may agree, because you are experiencing financial difficulty.
- Other Form of Payment Relief : Graduated and income sensitive payment plans are available. Graduated payment plans provide short-term relief through low, interest only payments followed by standard principal and interest payments. An income sensitive payment plan offers borrowers payment relief with payments that are a percentage of the borrower's gross monthly income.
These will provide you with payment relief and help you maintain a good credit rating. If you qualify and apply for federal interest subsidies on your loan during deferments, your loan balance will not increase during the deferment period because the government will be making interest payments on your behalf. However, if you do not qualify for federal interest subsidies on your deferment, or if your loan is in forbearance, your loan balance will increase by the amount of the unpaid accrued interest. (Calculate how much a deferment or forbearance will cost you before you apply.)
It's important to act quickly if you find your education loan payments hard to handle. If you default, or fail to make your loan payments as scheduled, you risk very serious consequences. Your school, the financial institution that made or owns your loan, your state education loan guarantor, and the federal government can all take action to recover the money you owe. They may notify national credit bureaus of your default, negatively affecting your credit record. You could find it difficult to borrow money to buy a car or a house, and you would be ineligible for additional federal student aid if you decided to return to school. The financial institution that owns your loans may ask your employer to deduct loan payments from your paycheck, and your state and federal income tax refunds could be withheld and applied toward the amount you owe. Also, delayed payment and collection activities could increase the cost of your loan.
So if you're having trouble with loan payments, don't wait – contact your loan service provider immediately.
The Taxpayer Relief Act of 1997
The Taxpayer Relief Act of 1997 provided students and their families with a variety of new tax benefits. These include:
- Hope scholarship credits.
- Lifetime learning credits.
- Education IRAs.
- Penalty-free IRA withdrawals.
- Deductibility of education loan interest.
- Qualified state tuition programs.
Taxpayers seeking advice on how to make the best use of these benefits may wish to consult a qualified financial advisor.
The provision on the deductibility of education loan interest means that you may be able to deduct the interest you paid on your student loans provided the interest paid during the tax year falls within a specified period of time. The covered period is defined as the first 60 months that payments are required--months that your loan payments are deferred or are in a forbearance do not count against your 60 month period. Interest payments made while you are still attending school or in your grace period are not eligible for the tax deduction as these payments are paid prior to the beginning of your covered period.
In January of each year, Sallie Mae calculates the amount of interest you may be eligible to deduct on your federal tax form for the previous year. If you were in your first 60 months of repayment during the previous year, you should receive a letter postmarked by January 31 stating the amount of interest you paid which may be eligible for the deduction. You can also get your interest information through your online account. If you do not have a password to access your Sallie Mae student loan information, you can request one online.
For more information about deductibility of interest of any of the other new benefits listed above, contact the IRS or visit the agency Web site at www.irs.ustreas.gov . The IRS site includes an easy-to-read summary of each benefit, followed by a comprehensive question and answer list.
For more information, please call 1-800-858-7822 or email Studentlending@regions.com.
*Please note: In order to avoid interest fees, your payment must be received by the repayment begin date listed on your Repayment Obligation. This date is approximately 45 days prior to the first payment due date. **Borrowers who authorize the automatic debit of funds from their bank account to cover their monthly education loan payments will receive an interest rate reduction of 0.25 percentage point during repayment on eligible Stafford, Parent PLUS, and Graduate PLUS Loans. Assuming the loan is serviced by Sallie Mae, the benefit remains available for as long as the borrower's monthly payment is successfully deducted from the borrower's bank account. Borrowers can elect to make payments via automatic debit through Sallie Mae's online account management system. This benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment or forbearance. If the loan is not serviced by Sallie Mae, other restrictions may apply.