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Should I Notify Lender of Graduation?

Long-time reader Geoff asked the following question:

My wife finished her grad school a year ago and got a job as a teacher. This summer, she’s been taking college courses in order to boost up her pay. We just received an email from Sallie Mae (her student loan provider) that they have automatically put her loans into deferment until 2012 due to her
enrollment activity. I’m assuming that the colleges she’s taking courses from somehow communicate with Sallie Mae and that’s how they found out. Although she is taking 12 credits this summer, it’s only for the summer, and I know a deferment usually applies only if you continue to be in school. Will they automatically know that she is no longer in school in September, and will end the deferment? If not, do we have to notify them? And if we don’t would we be penalized?

The only question I can answer is that the deferment rule is you must be in school at least part-time, as defined by your school. Your school may define 12 credits as part-time, so you’re safe there.

As for automatically knowing, my lender, ACS, uses a central database that is supposed to be updated by the school with my student status. When I took a semester off, that database was updated to reflect that. Now, the loan is still in deferment but I graduated a couple months ago, so my question is the same as Geoff’s – will I be on the hook for the interest? Is it my responsibility to notify the lender? Or will they know later, when the school updates the database?

I tried asking ACS but gave up after thirty minutes on hold, does anyone know how we should be handling this?

Update: I emailed ACS two days ago with this question and here was their replay:

The school is a participant of the National Student Loan Clearinghouse (NSLC) they will report your enrollment status and graduation date to the NSLC, which in turn will forward this information to ACS.

Interest will start to accumulate once the account enters repayment status.