The document that explains your rights and responsibilities as a federal student loan borrower is called the Master Promissory Note (MPN).
What is the Master Promissory Note (MPN)?
- The MPN is a legally binding document in which you promise to repay your loan(s) and any accrued interest and fees to the U.S. Department of Education.
- It outlines the terms and conditions of your loan(s), including your rights and responsibilities as a borrower.
- The MPN can be used for multiple loans over up to 10 years, depending on enrollment and school policies
Key Borrower Rights and Responsibilities Explained in the MPN and Related
Documents:
Rights:
- Receive written information about your loan obligations, interest rates, fees, repayment schedule, and options before repayment begins.
- A grace period before repayment starts.
- Notification if your loan is transferred to another servicer.
- The ability to request deferment or forbearance if you qualify.
- Prepay your loan in full or in part anytime without penalty.
- Receive documentation when your loan is paid off
Responsibilities:
- Use the loan only for educational expenses.
- Repay the loan in full, with interest, even if you do not complete your program, cannot find a job, or are dissatisfied with the education.
- Notify your loan servicer or school of any changes to your name, address, phone number, enrollment status, or employer information.
- Complete entrance counseling before receiving funds and exit counseling before leaving school or dropping below half-time enrollment.
- Make timely payments even if you do not receive a bill.
- Communicate with your loan servicer if you have difficulty making payments to explore options like repayment plans or deferment
In summary, the Master Promissory Note (MPN) is the primary document that explains your rights and responsibilities as a federal student loan borrower, supplemented by entrance and exit counseling materials and communications from your loan servicer
