Student loans are very important to those looking to obtain a college degree. While loans are widely available to most people, understanding the contract terms of these loans can be a monumental undertaking. Parents & students alike assume you're only agreeing to pay back the loan with interest (in some cases) over a period of time. But there is a little more detail than that.
Some loans have contract terms in addition to what is called a promissory note. The promissory note is essentially just an agreement saying you'll pay the loan back at some point. The terms usually get more involved than this. Some loan contract terms specify you must pay the loan back by a certain date, most commonly within ten years. Most people just assume they can pay off the student loans for the rest of their lives. In a few loans this might be the case, but for most you're already on the clock.
Keep your terms & promissory note readily available so you can turn to them later. They may help you in the long run. Some loan companies attempt to change terms you've already agreed to. For example, one loan company prior to 2009 allowed students to use two years of forbearance (where you aren't required to pay anything on your loan after graduating) but at the beginning of 2009 decided to cut that to one year without informing any one. Individuals filed injunctions because they agreed to the two years & most were successful. The few that weren't had already used their forbearance periods.
