Since a college education is so expensive, all high school students and their parents need to learn about student loans. You need to be well informed in advance to be able to select the right loans at the right terms. Here is a great place to begin.
Know how long of a grace period is in effect before you must begin to make payments on the loan. This is important for avoiding penalties that may result. Having this knowledge of when your payments are scheduled to begin will avoid incurring any penalties.
Be aware of the terms of any loans you take out. You need to be mindful of your balance levels, your current lenders and your repayment status of each loan. These facts will determine your loan repayment and forgiveness options. This will allow you to budget effectively.
It is acceptable to miss a loan payment if serious extenuating circumstances have occurred, like loss of a job. 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 know that the interest rates may rise.
If you have trouble repaying your loan, try and keep a clear head. Emergencies are something that will happen to everyone. Know that there are options available such as a forbearance or deferment. But bear in mind that interest will still accrue, so consider making whatever payments you can to keep the balance in check.
Anyone on a strict budget who is facing the repayment of a student loan is put in a difficult situation. There are loan reward programs that can help people out. LoanLink and Upromise are two of these great programs. These are similar to programs that give cash back. When you spend, you get rewards that you can use on loans.
To make your student loan money stretch even farther, consider taking more credit hours. Full time is 9-12 hours, but you can go as high as 8. This will decrease the loan amount.
Applying for a private loan with substandard credit is often going to require a co-signer. It’s a good idea to stay up to date with the payments you make. If you don’t keep up, your co-signer will be responsible, and that can be a big problem for you and them.
There is a loan that is specifically for graduate students or their parents known as PLUS loans. Their interest rate does not exceed 8.5%. While this is generally higher than either Perkins or Stafford loans, it still has lower interest rates than the typical personal loan. These loans are much better suited to an older student that is at graduate school or is close to graduating.
The amount of educational debt that can accumulate is massive. With that tends to come a large amount of student loan activity that, if entered into unwisely, can have a detrimental impact on borrowers well into the future. Luckily, the information here can let you know what pitfalls you can avoid.
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