Just graduated from college? The summer probably seems like the perfect opportunity to relax and de-stress. After all, you spent four years (or more) working hard in school.
But if you have student loans, your grace period is only a few months long — and the time can fly by quickly. You’ll have to start making payments before you know it.
Understanding who manages your loans and how to make payments is critical to staying on track. There are currently nine federal loan servicers, including the Missouri Higher Education Loan Authority (MOHELA).
If you have MOHELA student loans, here’s what you need to know to prepare for repayment.
MOHELA student loans
MOHELA has been around for over 30 years. The company has over 530 employees and is headquartered in St. Louis, Missouri. It also has offices in Columbia, Missouri, and Washington, D.C.
MOHELA services loans under the Direct Loan and Federal Family Education Loan (FFEL) programs. If MOHELA is your loan servicer, you’ll make payments directly to them. You can contact the MOHELA customer service team with questions or to discuss repayment options.
MOHELA allows you to make payments in several different ways:
- Sign up for automatic payments. Reduce the risk of missing payments by signing up for auto debit. As an added perk, you’ll receive a 0.25% interest rate reduction.
- Make payments by phone. You can make payments at any time, day or night, via MOHELA’s automated phone line at 1-888-866-4352.
- Mail a check or money order. Before sending a payment, contact customer service to find out where to send it. The mailing address varies depending on your account information.
- Make one-time payments at www.MOHELA.com. If you want to manually make payments — or make a lump-sum payment after a windfall — you can do so on their website.
It’s a good idea to set up your online account before your grace period ends. Registering for an account will allow you to see your loan balance and make payments electronically.
To start, go to www.MOHELA.com and click on the “Create Web Account” button. You will need your Social Security number and date of birth to open an account. The site will prompt you to enter your information and choose a username and password.
Once you create your account, you can log in at any time to make payments or check your loan balance.
Prefer to check your student loans on the go? MOHELA’s site is also mobile-friendly. You can make payments or download necessary forms via your smartphone.
How MOHELA applies payments
Your MOHELA student loans accrue interest based on your total balance and the amount of time between payments. When you make a payment, the loan servicer first applies the money toward any outstanding fees and then accrued interest. When you make a payment that’s large enough to cover fees and interest with money left over, the rest of your payment goes towards the principal.
For borrowers with multiple loans, MOHELA applies your payment proportionately across all loans, unless you provide other instructions. If you’d like to target a specific loan first, you can explain how you’d like payments applied online or by contacting customer service at the time of payment.
For those who want to pay their loans off as quickly as possible, you’ll have to provide instructions for that, too. The default setting for MOHELA loans is to advance your next payment due date. That means if you overpay, the amount due the next month will be less than your usual minimum.
If you want to make the extra payment without reducing your next bill, you can submit special payment instructions online or by calling customer service.
What to do if you can’t afford payments
If you’re struggling to keep up with your student loan payments, MOHELA offers several options to reduce or postpone your payments.
Your federal student loans serviced by MOHELA are likely eligible for income-driven repayment plans, which cap your payments at a small percentage of your discretionary income.
If you are dealing with a temporary financial hardship, such as an illness or unemployment, you might qualify for a deferment or forbearance. With these options, you can stop making payments for a set period without damaging your credit report.
Entering an income-driven repayment plan, forbearance, or deferment can extend the length of your repayment, causing you to pay more over time in interest. But if you’re having financial difficulties, they can be a smart solution to stay current on your loans and avoid student loan default.
MOHELA customer service
If you have questions or issues with your MOHELA student loans, you can call their customer service line at 1-888-866-4352 from 7 a.m. to 9 p.m. CST, Monday through Thursday, and 7 a.m. to 5 p.m. on Friday. The phone line has an automated system, so you will need to know your loan account number or your Social Security number ahead of time.
If you contact customer service but are not satisfied with their response, you can escalate your problem to a MOHELA ombudsman by calling 1-866-820-8542 or submitting a formal request online. A student loan ombudsman is a neutral third-party who works with both you and your loan servicer to reach a resolution.
Once you submit a formal request, the ombudsman will research the issue and contact you for more information as needed.
Managing your loans
When it comes to managing your student loans, putting them off or ignoring them during your grace period is one of the worst things you can do.
By taking action now and coming up with a plan ahead of time, you can ensure you’re on track with your repayment.
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