Student Loan Debt in 2025 – Average Balances, Repayment Options, and Relief Strategies

Many college graduates — both recent and not-so-recent — are dealing with overwhelming student loan debt. As of 2025, U.S. student loan borrowers collectively owe approximately $1.77 trillion in federal and private student loan debt. The average undergraduate borrower now carries around $29,300.

If you’re planning to attend college for the first time, one of the best ways to avoid excessive student loan debt is to fully understand all your financial aid options (not just loans). If you’ve already taken on student loan debt and are now struggling to manage it, there are solutions. Borrowers with federal student loans typically have more repayment protections, but there are also options for those holding private student loan debt.

Student Loan Debt: Federal vs. Private Comparison

Learn About Your Student Loan Debt Options

Managing student loan debt effectively depends on which type of loan you have. Federal student loans usually offer the most flexible relief options, including income-driven repayment plans and several types of forgiveness programs. Private student loans are more limited, but many lenders do offer short-term relief such as deferment or forbearance. Some borrowers may also be able to consolidate or refinance their private loans for a lower monthly payment. Before choosing any relief option, make sure you understand the trade-offs — for example, reducing your payment through consolidation may increase your total interest cost over time, and most deferment/forbearance options allow interest to continue accruing.

Repayment Options for Federal Student Loan Debt

Federal student loans come with built-in protections and flexible repayment options that private loans typically don’t offer. Whether you’re experiencing financial hardship or simply want a more manageable monthly payment, the Department of Education provides several structured paths.

Standard Repayment Plan

This is the default 10-year repayment plan. It features fixed monthly payments and is ideal for borrowers who want to pay off their loans quickly while minimizing interest.

Income-Driven Repayment (IDR) Plans

IDR plans base your monthly payment on your income and family size. These are often the most helpful options for borrowers with lower or unpredictable income. Plans include:

• PAYE (Pay As You Earn)
• REPAYE (Revised Pay As You Earn)
• Income-Based Repayment (IBR)
• Income-Contingent Repayment (ICR)

Under these plans, any remaining balance may be forgiven after 20–25 years of qualifying payments.

Public Service Loan Forgiveness (PSLF)

Borrowers employed full-time in qualifying nonprofit or government roles may qualify for loan forgiveness after making 120 qualifying payments under an IDR plan.

Extended and Graduated Repayment Plans

These plans extend repayment up to 25 years and may begin with lower payments that increase over time — useful for borrowers expecting income growth.

Deferment and Forbearance

If you’re experiencing temporary financial hardship, you may qualify to pause your payments. Interest typically continues accruing during forbearance and some deferments.

Repayment and Refinancing Options for Private Student Loans

Private student loans, issued by banks and private lenders, don’t come with federal protections like forgiveness or IDR plans. However, borrowers still have a few tools available.

Standard Repayment Plans

Private lenders often offer 5-, 10-, or 15-year repayment terms. Some also provide interest-only payment periods while you’re in school or during short-term hardship.

Refinancing Your Private Student Loans

Student loan refinancing is the most common strategy for managing private loan debt and can help borrowers:

• Lower monthly payments by extending their repayment term
• Reduce interest costs by qualifying for better rates
• Simplify repayment by combining multiple loans into one

Just remember: once you refinance a federal loan into a private loan, you permanently lose access to federal protections. Only refinance federal loans if you’re sure you won’t need benefits like IDR or PSLF.

Temporary Forbearance or Hardship Options

Some private lenders offer temporary payment relief for borrowers facing financial difficulty. These programs vary, so reach out to your lender for details.

Cosigner Release

If you used a cosigner, many lenders allow you to release them after 12–36 months of on-time payments.

What Should I Do If I Can’t Pay My Student Loans?

If you’re feeling overwhelmed and worried about missing payments, you’re not alone. Financial setbacks happen, and taking action early is the best way to protect yourself.

1. Reach Out to Your Loan Servicer ASAP

One of the biggest mistakes borrowers make is ignoring their loans. If you’re struggling, contact your servicer immediately to discuss your options.

CollegeWhale Tip: Be clear and honest about your situation. Servicers can’t help you unless they understand what you’re dealing with.

2. Explore Repayment Options

Your servicer can walk you through options that may reduce your monthly payment. For federal loans, that may include IDR plans or consolidation.

CollegeWhale Tip: Make sure you understand the differences between federal and private loan options so you choose the right strategy.

3. Ask About Deferment or Forbearance

If your financial hardship is temporary, pausing your payments may give you room to breathe.

CollegeWhale Tip: Before entering forbearance, ask how much interest will accrue. A pause now can mean a higher balance later.

4. Show Good Faith

Once you’ve arranged a plan with your servicer, follow through. Submit requested documents and make payments as agreed. If you hit another snag, let them know right away.

CollegeWhale Tip: Nonprofit credit counseling agencies can help you understand your options if you’re feeling overwhelmed.

5. Don’t Wait Until It’s Too Late

The earlier you communicate, the more options you have. Missed payments can quickly lead to delinquency and default.

CollegeWhale Tip: Set up autopay or reminders to stay on top of due dates — one missed payment can snowball fast.

Take Control of Your Student Loan Situation

Student loan debt can feel heavy, but you have options. Staying proactive, communicating with your servicer, and choosing the right repayment strategy can help make your loans far more manageable. Just don’t ignore the problem — taking action early keeps your options open.

What Happens If Student Loan Payments Are Ignored

Ignoring your student loan payments can lead to serious consequences that affect your finances for years. If you’re unable to make payments, contact your lender immediately to explore your options. If you ignore your loans, the following may occur:

1. Your loans may be sent to a collection agency. You may be responsible for collection costs, legal fees, and administrative charges.
2. You can be sued for the full loan balance. Your wages may be garnished, your tax refund may be seized, and certain federal benefits may be withheld.
3. Your default will be reported to credit bureaus, damaging your credit and making it harder to obtain credit cards, auto loans, or mortgages — and in some cases, even certain jobs.
4. You will lose access to additional federal financial aid until the default is resolved. You may also lose eligibility for deferment, forbearance, or subsidized interest benefits.
5. You may be unable to renew a professional license.
6. You may be prohibited from enlisting in the U.S. Armed Forces.