It seems that nowadays, few individuals are able to graduate from college, graduate school or professional school without having incurred some amount of student loan debt. The right way to graduate in good financial shape is to learn all you can about student loans before getting any. Keep reading so that you can prepare yourself.
Don’t worry about not being able to make a payment on your student loans if something unexpected like job loss has happened. A lot of the time a lender will allow a payment to be postponed if you show them you’re having a hard time. Just remember that doing this may raise interest rates.
Do not panic if an emergency makes paying your loans temporarily difficult. Life problems such as unemployment and health complications are bound to happen. Virtually all loan products offer some form of a forbearance or deferment option that can frequently help. Just remember that interest keeps accruing in many forms, so try to at least make payments on the interest to keep the balances from increasing.
Student Loans
Select a payment option that works best for your situation. Many student loans offer 10 year payment plans. You may discover another option that is more suitable for your situation. As an example, it may be possible to extend your payment time, but typically that’ll include a higher interest rate. You may negotiate to pay just a set percentage of the money you begin to earn. Sometimes student loans are forgiven after 25 years.
Look to pay off loans based on their scheduled interest rate. You should always focus on the higher interest rates first. Paying a little extra each month can save you thousands of dollars in the long run. Speeding up repayment will not penalize you.
Anyone on a strict budget who is facing the repayment of a student loan is put in a difficult situation. Loan rewards programs can help a little with this, however. Check out programs from Upromise such as SmarterBucks and LoanLink. These are similar to cash back programs so that means you can get rewards that help you with your loan situation.
Increase your credit hours if possible. Sure a full time status might mean 12 credits, but if you can take 15 or 18 you’ll graduate all the quicker. The will assist you in reducing the size of your loans.
Stafford Loans
The best loans that are federal would be the Perkins or the Stafford loans. They are the safest and least costly loans. They are an excellent deal because for the duration of your education, the government will pay your interest. The Perkins loan interest rate is 5%. Stafford loans offer interest rates that don’t go above 6.8%.
Student loans are something that you will eventually have to tap into. It’s a fact of life for most students. Since you have this information, you should feel better about getting a loan.
