How Payments Are Applied
If you provide instructions, MOHELA will follow your instructions unless it would leave your loans delinquent.
If no instructions are provided, MOHELA will apply payments in the following manner:
(FOR DIRECT AND FEDERALLY OWNED FFEL LOANS ONLY)
If no instructions are provided, MOHELA will apply payments in the following manner:
(FOR COMMERCIALLY OWNED FFEL LOANS ONLY)
How Payments ared Applied
Payments Made Within 120 Days of Disbursement (Loan Cancellation)
Unless instructed otherwise, in most cases payments made within 120 days of when your Direct Loan was disbursed (sent to the school)
are applied as a reduction in the "Original Principal". You do not have to pay interest or loan fees on the portion of your loan
that is returned within the timeframe described. We will retroactively change your "Original Principal" and adjust any interest and
loan fees that apply to the amount of the loan that is returned. The payment source for these payments will show as "Principal
Payment" in the payment details of the
Payment History. These payments are made effective
as of the loans' disbursement date. In addition, your "Original Principal" will be adjusted to reflect the amount originally disbursed
less any amounts repaid in the first 120 days of the loan. Please note this excludes consolidation loans.
Payment Application
Paying Ahead
Paying Ahead means that your current payment has been satisfied and you have paid at least a portion
of your future bill
There is no maximum limit to the amount you can pay each month. Paying your account ahead of schedule
offers many benefits such as:
Each time you satisfy a bill due, we will automatically advance your next payment due date and
your billing statement will indicate a payment is not required for that bill. You may still continue
to make payments to decrease your total interest cost and pay your loan off sooner. You have the option
to select if you want your due date to be advanced on your loans. To request that all payments made
over your monthly payment amount be applied to your current bill and not advance your due date, please
see Submitting Special Payment Instructions.
For borrowers working toward
Public Service Loan Forgiveness,
please note that additional payments may not apply. For borrowers on an income-driven repayment (IDR)
plan you may pay ahead, however your due date cannot be advanced beyond your annual income-driven
repayment (IDR) anniversary date and the required number of monthly payments must be made to be eligible
for forgiveness. Borrowers with $0 payments on an IDR Plan cannot pay ahead to advance their due date.
Auto Debit
Please keep in mind your Auto Debit will continue to withdraw your regular amount due each month plus
any additional recurring amount you have requested. This occurs even if:
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Your monthly payment amount changes
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You made a payment since your last due date
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You made additional payments and are in a “paid ahead” status
You may set up or make changes to the additional recurring amount you want withdrawn using Auto
Debit, and whether you want it to pay your account ahead. Login, click Auto Debit and complete the
steps to modify your Auto Debit enrollment.
To target the additional recurring amount submit your request via:
FFELP California State Residents Only: If specific payment application instructions are not received, payment
amounts in excess of the amount due will be applied to the loan with the highest interest rate. If multiple loans share the highest
interest rate, of those loans, the payment amount will be applied to the loan with the highest balance.
Submitting Special Payment Instructions
SpecialPaymentInstructions
To request special payment instructions when making an additional or partial payment, submit your request via:
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Web – Log into mohela.com to make and target your payments to be applied to a specific loan or set of loans.
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Phone – Contact customer service at 888.866.4352.
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Secure Message or Mail – Provide
instructions for how to apply the payment. Include the amount, disbursement date, loan type and
indicate this is a “one-time payment instruction”. Submit your recurring request via fax (866.222.7060) or mail to:
MOHELA
633 Spirit Drive
Chesterfield, MO 63005-1243
To never pay loan(s) ahead when you make additional payments greater than the total amount due (See “Additional Payments & Paying Ahead”),
or to provide instructions for how all ongoing payments should be applied, provide instructions for how to apply additional payment.
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Include the Amount, Disbursement Date, Loan Type and indicate this is a “Standing Payment Instruction”
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Submit this recurring request via fax (866.222.7060)
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Secure Message or Mail To:
MOHELA
633 Spirit Drive
Chesterfield, MO 63005-1243