If you’ve ever applied for a student loan, or any other type of loan, Who Do You Contact If You’ve Already Accepted More Loan Money Than You Need? The next question is who should you be reaching out to if you’ve already accepted more loan money than necessary?
The short answer is, reach out to your school’s financial aid office (if the loans are for students) or to your loan servicer or lender (if they’re personal or private loans) as soon as you can.
Here we explain exactly what to do if you’ve borrowed more than you need, who to call and how to give back any extra funds so that you don’t end up paying unwarranted interest.
Why Borrowing Too Much Is a Problem
Access to more loan money than you really need might seem appealing at first more money for tuition, books or living expenses. But with that comes long-term financial aftereffects.
You’ll pay more interest down the line.
- You will owe a much larger overall balance.
- It can increase the amount you have to cough up each month once you’ve graduated.
- It could influence your eligibility for other types of financial aid down the road.
- Return it sooner, and you save more money.
Who Do You Call to Tell Them You’ve Already Accepted More Loan Money Than You Need?
Let’s unpack this by what kind of loan you have:
Government Student Loans Call Your School Financial Aid Office
If you have accepted a federal student loan, the first thing to do is contact your college or university financial aid office.
Federal loan money will be disbursed by your school.
They can aid you in lowering or cancelling the remaining disbursement.
If the loan is already posted to your account, they can begin processing the return of funds to Department of Education.
Steps to follow
Get there financial aid office recommendation everywhere.
Appeal to cancel or lower your loan, she said.
You will need to pay interest or fees but can return the overage within 120 days of disbursement if money has been deposited in your account.
Note: The 120-day rule applies to federal loans; return the money within that window, and your loan balance (including interest) will be treated as though the money was never borrowed.
Private Student Loans – You Have Questions, We Have Answers Contact Your Loan Lender or Servicer
In the case of a private student loan, if you took one out, the lender manages your money — not your school. In that case, you need to contact the lender or servicer for your loan directly.
Steps to follow
Call or email your loan servicer and let them know you want to return excess funds.
Enquire about their refund or reduction policy.
There are some who allow you to return the money within a certain amount of time (usually 30-60 days) without any penalties.
Document everything in writing and save any returned payment receipts.
Paying back private college loan money prematurely will reduce your balance and the amount of interest you pay over time.
Never procrastinate about requesting financial help If you are a parent, you will again need to fill this out: Federal PLUS loans contact your Fin. aid office or servicer!
If you are a parent who took out student loans under the Parent PLUS Loan program, the process is similar:
Prior to disbursement: Communicate with the financial aid office in order to reduce or cancel and funds remaining on you loan.
After disbursement: Contact your loan servicer to return funds within 120 days of the disbursement date to have interest and fees removed.
Personal or Business Loans Get in touch with your loan lender
For personal, auto or business loans, call the number for your loan provider or bank.
Steps
- Tell them you take more money than was necessary.
- Request directions on how to make an early repayment or a partial refund.
- Some loans may require specific policies for returning the part of principal in advance.
- Be sure to verify any early payment penalties or prepayment terms.
What if You Keep the Overpayment?
If you hold onto more loan money than you actually need, it may sound like a good idea now — but there are hidden costs down the line.
You will find yourself on the wrong side of more total interest if you do.
You harden your debt-to-income ratio, which could hurt future borrowing.
It could put other of your financial goals (say, buying a home or saving for retirement) on hold.
You’re just going to end up paying money that you didn’t need, plus interest.
So, the best thing for long-term financial health is to give back extra money as a producer of interest, and do so expeditiously.
How Do I Return the Extra Loan Money?
Here’s a step-by-step guide if you want to return any excess student loan money:
Step 1: Get in Touch with the Right Office or Lender
Determine if your loan is federal, private or institution. Next, touch base with your financial aid office or loan servicer.
Step 2: Ask About Return Policy
Each type of loan has its own deadline (e.g., 120 days for federal loans). Ask your lender for details.
Step 3: Respond Promptly To Return The Money
If your school dispersed the funds, return it directly to the financial aid office with that money.
Send the money in your bank account back to your loan servicer.
Step 4: Keep Documentation
Maintain documentation that demonstrates you repaid the debt receipts, transaction slips or emails in case you need proof for future reference.
Step 5: Watch Your Loan Account While your student loan offers in-school deferment, you may still be required to make some payments.
Once you return the over payment, review your loan balance online to make sure your adjustment is accurate.
How to Avoid Borrowing Too Much Again
To avoid the same over-borrowing in the future, consider these smart tips:
- Be as accurate as possible about only the amount you need to pay for tuition, books and living costs.
- Before taking out any loan, you should set up a student budget.
- You want to use scholarships and grants first, then loans for the rest.
- Carefully review this loan offer with your financial aid counselor.
- Review your financing needs at the end of every quarter or semester before accepting more loans.
- Borrow less now, repay less later with lower interest and a smaller presence of mind.
Why You Should Act Quickly
The sooner you act, the more money you save. When the surplus loam money is actively returned during its allowable period, it prevents:
Accrual of unnecessary interest.
Increase in total loan balance.
Administrative or processing charges.
If you delay long enough, you may have to pay back the full amount with interest — on all of the money, whether or not you ended up needing it.
And the answer will depend on what type of loan you have:
Federal student loans: Reach out to your school’s financial aid office.
Private loans: Reach out to your lender or loan servicer.
Parent PLUS loans: Call the financial aid office or loan servicer.
Return the money quickly in all cases and maintain copies of all records. Taking this step not only lowers your total borrowing costs, it safeguards your financial future.
FAQs
I took out too much student loan money. Whom do I call?
Get in touch with your financial aid office right away. They may be able to cut or remit the surplus payment back to the lender for you.”
Can I return leftover student loan money?
Yes. Federal loans can be paid back within 120 days with no interest or fees. For private loans, consult your lender’s policy.
What if I have money left over from my loan?
You will face more in interest and principal repayments, driving your total repayment amount up.
Can I bring my loan down after it’s disbursed?
Yes. Pay attention to your billing notice and reach out to your school or loan servicer right away if you want a reduction, or refund.
Are there any penalties for returning some of the loan money?
No, refunding overpayments early saves you money in interest payments and total loan balance.
