Income-based repayment plans are extremely helpful if you are having trouble making your federal student loan payments. These plans base monthly payments on a percentage of your discretionary income and your family size. However, the Department of Education and your administrator require you to submit your income and family size information each year so they can recalculate your monthly payments (if necessary).

Failure to recertify your income-based payment plan before the deadline can have disastrous consequences. Depending on the amount of student debt you have, your monthly payments could increase by hundreds of dollars.

What can happen if you forget to certify your income-based payment plan?

A hypothetical example can further explain:

Let’s say you have $ 95,000 in direct federal loans and you reported an adjusted gross income of $ 35,000 in 2016. For 2017, you have decided to use the classic income-based repayment (IBR) program. Starting in April, his monthly payments were reduced to $ 200 per month from $ 1,100 per month (which they were under his 10-year payment plan). To make payment even easier, set your monthly payments to be withdrawn directly from your checking account before the due date.

Fast forward a few months. In December 2017, your loan servicer sends you an email advising you to recertify by February 24, 2018 or your loan payments will increase to $ 1,100 per month by April 3. However, you have changed your email and phone number. You never get the warning. It arrives on February 24 and does not meet the deadline. Once April 3 rolls around, you are horrified to find that your checking account is overdrawn by more than $ 500, including overdraft fees. You can’t pay your rent, utilities, or credit card bill.

Although this is the worst case, many people do not recertify their income-based payment plans on time each year. In 2015, the Consumer Financial Protection Bureau reported that 57 percent of borrowers using these plans did not recertify before the deadline. This is not always the fault of the borrower. Loan servicers cannot submit recertification documentation on time. Borrowers who submitted their updated information on time may be frustrated by higher payments, even when they did nothing wrong.

The good news is that the Department of Education does not “kick” you out of its income-based payment program. You can still recertify, albeit late. Unfortunately, they may have run out of several hundred dollars. What is likely to happen is that your loans will be placed on an administrative forbearance while your updated information is processed. This can temporarily stop your unaffected payments.

It is essential to remember the deadline for recertification. Ask your administrator if they can provide you with this timeframe. Always make sure your administrator has up-to-date and accurate contact information. If possible, try to recertify months before the deadline. This can help avoid delays with your recertification.