Once you graduate from school you do not have to pay back your federal student loan right away. You usually have a six-month grace period before you have to make any payments on your student loans. For instance if you graduated from school May 1st your grace period on your federal student loan would last until October 1st.  The government assumes that six months after graduation you will be all set up, employed or running your own business and be able to make that very first loan payment.  So in essence if you graduated in the spring you get the summer off before you have to pay.

Many student debt-refinancing experts recommend refinancing your student loan during the actual grace period so you get a head start on organizing your future life as a responsible citizen.  This is because this could cut your monthly payments in half. Usually this means refinancing the term of your loan so that it is twenty years long instead of ten years long. However if you do decide to do this make sure that it happens at a low interest rate. You should be able to renegotiate your loan at the beginning of your grace period and make an additional saving of .06%.

 Also if you refinance your loan early on in the game you can end up paying a lower more comfortable interest rate. If the government knows that you are willing to pay every penny of the loan back you can sometimes even manage to get the entire loan discounted.  A lender would rather have you hooked into their system over a long period of time at a lower monthly payment then have you default on payments that are too high for you and that have been negotiated at a lower terms.

Getting the total amount of your student loan lowered is called payment relief.  Another type of payment relief is a type of grace period, which is different than the initial one you are offered by the federal government. In this scenario you may be given a period of three to six month to not pay the loan off while you recover from an illness or catastrophe in life.

Remember if that you go for loan consolidation before the grace period is over you will enjoy all of the benefits of consolidation; such as a lower monthly payment, lower interest rate with borrower benefits, and repayment plans designed to fit your particular budget. This can make it easier on grads who get sick, who have yet to find a job or who have a high overhead to start their business (as is the case with a startup office for a doctor or dentist.)

The great thing is that if you do this there is no penalty if you decide to pay your student loan back early. This is not true of other kinds of loans when you reconsolidate. Considering all of the benefits of consolidating your student loan before the grace period is up it seems almost foolhardy not to do so!