Why it’s so important to make student loan payments on time

By Corey Buhay | Published on November 19, 2025

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Vacations, busy schedules, different due dates for different bills. Most of us have good intentions of paying our bills on time, but sometimes life still manages to get in the way.

The bad news is that, while late payments are common, they can do some serious damage. Some lenders charge hefty late fees. Others report you to credit bureaus, which can penalize you by dropping your credit score. A low score can make it hard for you to apply for mortgages, car loans, and other forms of credit in the future. The good news? Technology — like apps, digital reminders, and automatic payment systems — makes it easier than ever to stay on top of your student loans. Here’s what happens if you miss a bill, plus six tricks to help you make your student loan payments on time.

What happens if you miss a student loan payment?

First, let’s take a closer look at what happens if you make a payment after its due date.

While Earnest does not charge late fees — or fees of any kind, for that matter — many lenders do. The sizes of these fees can vary depending on the type of loan you have, the length of time that has passed since the payment was due, and more.

Paying a fee is one thing. But making late payments can also have a significant impact on your credit report. That’s because your repayment history is one of the largest components of your credit score. According to credit scoring model FICO created by Fair Isaac Corporation, your payment history makes up 35% of your score.

To be sure, making one late payment and missing it by only a few days is not going to ding your score by much — but a pattern of missing payments is likely to lower your credit score, either by just a few points or by up to 100. That means multiple late payments can do some serious damage, and may make getting it difficult to get approved for additional loans, like for a car or home, more difficult and expensive in the future. If your score takes a significant drop, it can also take a long time to build your credit back up.

If you fall far behind on your payments, your debt could be transferred to a collections agency. Debts that are in collections have a larger adverse impact on your credit and are more difficult to resolve than a single missed payment. Not to mention, collections agencies can be aggressive in their outreach, calling you several times a week to attempt to get you to pay.

6 Ways to make student loan payments on time

The good news is that it’s easier than ever to stay on top of your bills and never miss a payment. Here are some ideas to get on the right track:

1) Refinance or consolidate your loans

When it comes to student loans, keeping track of multiple due dates for multiple loans can be tricky. Student loan consolidation (which is available for federal loans) or refinancing¹ (which is available for both federal and private student loans) can help. Both are financial tools that gather multiple loans into one new loan. That leaves you with only one bill to pay each month.

Federal consolidation can also help you sign up for a number of repayment plans. These can help you extend your loan term and get a lower monthly payment. Some of these plans are income-driven repayment plans, which means your monthly payment will be set to a percentage of your discretionary income. These plans make student loan payments more affordable for many borrowers.

* As a result of ongoing court actions, the terms of some Income-Driven Repayment (IDR) plans, including the SAVE plan, may be subject to change. Please refer to studentaid.gov for the current status of these plans.

Student loan refinancing is similar, except that it happens through a private loan servicer. And with refinancing, you can secure a lower interest rate, which can save you money over the life of your loan². Refinancing is the only way to get a new interest rate on student loans.

2) Sign up for automatic payments

Enrolling in automatic payments makes bill pay stress-free. When you sign up for Auto Pay, you can rest assured that as long as you have sufficient funds in your savings account or checking account, your minimum payment will get paid no matter what. Some lenders, including Earnest, offer an interest rate discount³ to borrowers who sign up for Auto Pay.

3) Check your mail or email

Lenders will often send you notice via mail or email that your payment will be due soon, so keep an eye out. Go a step further and set up recurring reminders on your calendar before your payment to make sure you’re always ahead.

You can also log into your federal StudentAid.gov account or your private student loan account to find all payment details for each loan. Still need help? Reach out to your loan servicer and ask them directly.

4) Download the app

Chances are your lender or bank has an app to help keep your accounts easily accessible no matter where you are. Download the app to schedule, track, and change payments on the go. Consider enabling notifications, too: some apps will send automatic reminders to your phone to make sure you know a payment is coming up.

5) Pay early and extra

If you remember you have an upcoming payment and want to get it out of the way before you forget, you can always pay early. Just make sure that your lender does not have any prepayment penalties first. (Earnest doesn’t charge prepayment penalties, but some lenders do.) Similarly, if you have some extra cash at the end of the month, apply it as an extra payment. This reduces your chances of paying late and also can help pay off your debt faster in the long run.

6) Take responsibility

If you do fall behind or know in advance that you won’t be able to make your next payment, the best approach is to be honest. Reach out to your loan servicer and explain your situation. Many lenders, including Earnest, may be able to work with you if you have trouble making payments. Make that phone call as soon as possible. The further behind you fall, the more difficult it will be for your lender to work with you on a plan.

When you take on debt, whether through a student loan or with a credit card or mortgage, you are making a commitment to be financially responsible. Lenders take this commitment seriously, and so should you. The more careful you are to make your payments on time, the easier it will be to potentially access new credit and get lower interest rates in the future.

See how much you could save by refinancing your student loans

Sometimes setting reminders and signing up for automatic payments doesn’t quite cut it. If you’re doing everything you can do to stay organized but still missing payments because they’re unaffordable, refinancing could help. Student loan refinancing can help you extend your loan term, effectively lowering your monthly payments. It can also help you switch to a lender that doesn’t charge late fees.

If you meet your lender’s eligibility requirements, you may also be able to qualify for a lower interest rate. That could help you save money over the life of your loan and potentially get out of debt faster. Want to see how much you could save? Use our student loan refinance calculator to crunch the numbers for yourself, or check your rate with Earnest today. It’s fast, it’s free, and it won’t affect your credit score.

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Corey Buhay

Corey Buhay is a writer and editor based in Boulder, Colorado. She’s passionate about literature, the outdoors, and doing her taxes by hand. She has been writing about student loans and personal finance for Earnest since 2019. You’ll find her work in Outside Magazine, Backpacker Magazine, Smithsonian, and The Denver Post.

Disclaimer

Disclaimer: This blog post provides personal finance educational information, and it is not intended to provide legal, financial, or tax advice.