You might start getting student loan offers in the mail while still far from finishing high school. It can seem very helpful towards achieving your college goals. Make sure to consider these things before applying for that loan.
Do know that you are probably going to have a post-graduation grace period from your student loans before you are required to start making payments back. In order words, find out about when payments are due once you have graduated. Knowing when this is over will allow you to know when to pay your payments on time so you don’t have a bunch of penalties to take care of.
Make sure you understand the fine print related to your student loans. Keep track of this so you know what you have left to pay. These important items are crucial when it comes time to pay back the loan. It will help you budget accordingly.
Do not panic if an emergency makes paying your loans temporarily difficult. You will most likely run into an unexpected problem such as unemployment or hospital bills. Remember that forbearance and deferment options are widely available on a lot of loans. Just remember that interest is always growing, so making interest-only payments will at least keep your balance from rising higher.
Grace Period
Your loans are not due to be paid back until your schooling is complete. Make sure that you find out the repayment grace period you are offered from the lender. Stafford loans offer a period of six months. Perkins loans offer a nine month grace period. Other types of loans may vary. Be sure you know exactly when you will be expected to begin paying, and don’t be late!
Choose a payment option based on your circumstances. In most cases, 10 years are provided for repayment of student loans. It is possible to make other payment arrangements. Perhaps you can stretch it out over 15 years instead. Keep in mind, though, that you will pay more interest as a result. Your future income might become tied into making payments, that is once you begin to make more money. Certain types of student loans are forgiven after a period of twenty-five years.
There are lots of decisions to make in college, and one of the biggest is about debt load. A substantial loan with a high interest rate can end up being a huge problem. So, keep this information in mind as you enter college and embark on your future.