5 Tips for Solving Your Student Loan Problems
Summer is coming to a close. With that, college students are returning to their dorms or starting their first semester. There are a lot of things to manage within a school year: classes, homework, social life, and if you don’t live near your parents – laundry. Student loans no matter which year you’re in are easy to forget about until you get your first bill, that’s why we compiled this list to help you prepare for the inevitability that is your student loan payments.
Summer is coming to a close. With that, college students are returning to their dorms or starting their first semester. There are a lot of things to manage within a school year: classes, homework, social life, and if you don’t live near your parents – laundry. No matter which year you’re in are easy to forget about loans until you get your first bill. That’s why we compiled this list to help you prepare for the inevitability that is your student loan payments.
- Determine which types of loan you have: Every loan you have will be different. Some are private and of course federal, they will have different options for repayment and different ways to approach repayment. As well as different interest rates as well.
- Evaluate repayment options: Federal student loans will be placed into a standard repayment term. Which will be paid off in 10 years. Often times these payments are too high for borrowers to make. One option is to talk to your servicer about extended payment plans which will drastically drop your payment but you will be making payments for many more years and paying more over time. Another option is to look into Income-driven repayment plans. If you work for the public sector you may qualify for Public Servicer Loan Forgiveness which will forgive your loans after 10 years of qualified payments.
- Prepare for the future:You don’t make any payments on your student loans while you’re in school. Take that time to figure out when your payments will begin. The payments typically don’t start until after a grace period. A grace period begins when you finish school. Take all of this information and save any money you can so that when your loan payments start you’re ahead of the game.
- Be smart when managing multiple loans: As stated before, not all loans have the same interest rates. To mitigate your financial strain that these loans might cause pay closer attention to the loans with higher interest rates. Make sure you pay those off sooner. This will keep your overall balance low. You may even want to look into loan consolidation that might lower your interest rates. Especially look into consolidation if you have many loans or many servicers consolidating your loans into one or two loans with just one loan servicer may make it much easier for you stay on top of your loans. However, make sure you pay attention to your loan terms you don’t want to reset the number of qualified payments you’ve made.
- Pay additional when you can: Have enough money to pay on your loans in addition to your monthly payments? Do it. This will get you ahead of schedule. Which will reduce the amount of interest you’ll pay over time. Make sure you ask the end loan servicer to apply the extra money to the loan balance instead of crediting your next payment. A simple credit for next month won’t help you pay off your loan faster.
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