- Understanding Direct Debit
- Signing up for Direct Debit
- Getting Started
- Changes to Your Direct Debit Service
Can you automatically deduct my payments from my bank account every month?
Yes, we offer an automated payment service called Direct Debit. It's free, it's convenient, and you will qualify for a 0.25% interest rate reduction for using this service. Find out how to apply for Direct Debit.
What is Direct Debit?
Direct Debit is a free, automated payment service. It's not only convenient—you don't have to write a check or pay for a stamp—you also qualify for a 0.25% interest rate reduction when you use Direct Debit.
How does Direct Debit work?
You must apply for Direct Debit. After we approve your application, we will electronically transfer your monthly payment—along with any additional amount you request—from your checking or savings account to your student loan account.
This automated transaction happens on the same date each month.
Why sign up for Direct Debit?
Direct Debit is the most convenient way to make student loan payments.
- Save money. You qualify for a 0.25% interest rate reduction when you use Direct Debit.
- Don't worry. Since we automatically withdraw your monthly payments from your bank account, they're never late (as long as the funds are available).
- Save time. Your time is valuable. The transaction is automated, so you won't need to write checks or sign in every month to make your payments.
Am I eligible?
You are eligible for Direct Debit if:
- You have loans in repayment.
- You receive a monthly bill.
- You were not previously disqualified from using Direct Debit due to insufficient funds.
Loans for which you receive a quarterly interest bill aren't eligible for Direct Debit until they enter repayment.
Can I sign up for Direct Debit if I am past due on my loans?
Yes. When you sign the Direct Debit application, you also agree to allow us to make your loans "current" by suspending the past-due payments with a General Forbearance. When the Direct Debit service begins, your loans will be up to date.
How do I apply for Direct Debit?
|Step 1||Sign in to Account Access.|
|Step 2||Complete your online PIN application.|
|Step 3||Input your bank account information and any additional amount you wish to have deducted each month.|
|Step 4||eSign your application with your PIN OR print, sign/date, and return your application to us for processing.|
Once we process your Direct Debit application, we'll send you a letter to notify you of the results of your request.
How will I know when my Direct Debit service begins?
Your monthly bill will include a message informing you that the payment is scheduled to be withdrawn.
Will I still get a paper bill?
|If you entered repayment…||Then…|
|Before July 1, 2009||You will no longer receive a paper bill.|
|On or after July 1, 2009||You will continue to receive a paper account statement every month, unless you enroll in Paperless Billing.|
Can I pay more than my monthly payment amount through Direct Debit?
Yes. There is no limit to the amount you can have us withdraw every month from your checking or savings account. Just enter the additional amount when completing your Direct Debit application. We will continue to withdraw this additional amount even if there is a change to your payment amount.
To change the amount we withdraw each month, write or email us with the change. You must send the email from the email address we have on file for you.
NOTE: When you use Direct Debit, we prorate additional amounts across all loans with the same due date. To make an additional payment on a specific loan, you must pay online. Or call one of our experienced counselors for information about paying by mail.
If I pay using another method, do you still withdraw a monthly payment through Direct Debit?
Yes. We withdraw your payment (plus any additional amount you request) through Direct Debit every month, even if:
- You pay your monthly amount early (by telephone, mail, or online), before your payment is due.
- You pay more than your monthly payment amount so your loan is in "paid ahead" status.
If you do not want us to withdraw your monthly payment for any reason, you must contact us to suspend your Direct Debit service. You must continue to pay every month using another method during the time we suspend your service.
NOTE: You also do not receive a 0.25% interest rate reduction during the time we suspend your service. To avoid this, we encourage you to continue your Direct Debit service without interruption.
What if my due date falls on a weekend or holiday?
NOTE: We do not complete payment transactions on weekends or holidays. Payments for due dates falling on these days are submitted the business day before the due date. Most financial institutions will process your payment on the business day after the weekend/holiday; however, some may process your payment during the weekend/holiday. Refer to them for further information.
Example for Weekend Due Date:
- Friday—We submit your payment for processing for your Saturday due date.
- Saturday—Due date
- Monday—Your financial institution processes your payment
Example for Holiday Due Date:
- Friday—We submit your payment for processing for your Monday due date which falls on a holiday.
- Monday—Due date
- Tuesday—Your financial institution processes your payment
If I do not have enough money in my account on my due date, what should I do?
Contact us at least 3 business days before your scheduled payment date. We may be able to temporarily suspend your Direct Debit service. (You do not receive a 0.25% interest rate reduction during the time we suspend your service.)
If you do not ask us to suspend your Direct Debit service and your bank reports that there are insufficient funds, we'll make a second attempt to withdraw your monthly payment. If there are still insufficient funds when we make this second attempt, your loan will remain past due until we receive another form of payment.
What happens to my Direct Debit if my payment amount changes?
We will let you know your new payment amount. Unless you notify us of your intent to discontinue the service, we will withdraw this new amount (and any additional amount you have requested) automatically from your account on your scheduled due date.
What if my financial institution information changes?
If your bank account information changes, you must submit a new Direct Debit application to continue the service.
It's important you notify us, as it may be necessary for us to suspend any pending transactions in order to prevent a debit from an inactive account. Contact us at least 3 business days prior to your scheduled payment date.
NOTE: If you qualified for a 0.25% interest rate reduction for using this service, that reduction will be suspended while you are updating your financial institution information because Direct Debit will not be active.
What happens to my Direct Debit if I request a deferment or forbearance?
To prevent an unwanted withdrawal while your deferment or forbearance request is being processed, contact us to suspend your Direct Debit service. We automatically suspend your Direct Debit service once your deferment or forbearance is approved.
At the end of your deferment or forbearance, your Direct Debit service will resume on your regularly scheduled due date, unless you notify us that you no longer want to participate in this service.
If I have new loans that come into repayment, will they be included in my Direct Debit service?
No. You must complete, sign, and return a new Direct Debit application.
How do I cancel or discontinue my Direct Debit service?
Provide us with signed, written notification.
Allow up to 10 business days for us to process this request. If you want us to temporarily suspend the service, prior to its full cancellation, you must contact us at least 3 business days before any pending withdrawals.
NOTE: If you qualified for a 0.25% interest rate reduction for using this service, that reduction will be removed once you discontinue Direct Debit. To avoid this, we encourage you to continue your Direct Debit service without interruption.