Furthering Your Education: Student Loan Advice


Student loans are helpful, but if you don’t know what to look for, they can turn into a nightmare. So it is recommended that you educate yourself about any student loan before signing the contract. Read on to learn more about student loans.

TIP! Find out when you must begin repayments. This is generally the period after graduation when the payments are due.

Always know all the information pertinent to your loans. Make sure you know how much you owe and how to contact your lender. You also want to know what your repayment status is. These details affect your repayment options. It is your responsibility to add this information into your budget plans.

Stay in contact with your lender. When you make changes to your address or phone number, make sure you let them know. Read all mail you get from lenders. Take whatever actions are necessary as soon as you can. Overlooking things can end up being very expensive.

TIP! Don’t overlook private financing for your college years. There is not as much competition for this as public loans.

Don’t be scared if something happens that causes you to miss payments on your student loans. Many lenders will let you postpone payments if you have financial issues. Just know that taking advantage of this option often entails a hike in your interest rates.

Don’t let setbacks throw you into a tizzy. You will most likely run into an unexpected problem such as unemployment or hospital bills. There are options such as deferments and forbearance that are available with most loans. Make sure you realize that interest will keep building, so think about making at least interest payments so that you can keep balances from growing out of control.

TIP! Know how long the grace period is between the date of your graduation and the date on which you must start repaying the loans. Many loans, like the Stafford Loan, give you half a year.

A two-step process can be used to pay your student loans. First, ensure you make all minimum monthly payments. Next, make sure to apply additional funds to loans bearing the highest rates of interest, not necessarily the loans with the greatest balance. It’ll help limit your spend over a given time.

Choose a payment option based on your circumstances. In most cases, 10 years are provided for repayment of student loans. If this isn’t going to help you out, you may be able to choose other options. You may need to extend the time you have to repay the loan. This often comes with an increase in interest. Think about what you “should” be making in the future and carefully go over everything with a trusted adviser. Some loans’ balances get forgiven after 25 years.

TIP! Be sure you select the right payment plan option for you. Many student loans come with a 10-year plan for repayment.

Reduce the principal when you pay off the biggest loans first. That means you will generally end up paying less interest. Therefore, target your large loans. When you pay off one loan, move on to the next. Pay off the minimums on small loans and a large amount on the big ones.

Squeeze in as many possible credit hours as you can to maximize your student loans. You may be able to scrape by with 12 hours, but try to at least carry 15 per semester. If possible, go for 18. This will reduce the amount of loans you must take.

TIP! If you have a large loan, try to bring down the amount as soon as you can. This will reduce the principal.

Stafford and Perkins loans are two of the best that you can get. They are the safest and least costly loans. This is a good deal because while you are in school your interest will be paid by the government. Interest rate on the Perkins loan is five percent. The Stafford loan only has a rate of 6.8 percent.

PLUS loans are available if you are a graduate student or the parent of one. Normally you will find the interest rate to be no higher than 8.5%. This is a bit higher than Perkins and Stafford loans, but the rates are better for private loans. These loans are much better suited to an older student that is at graduate school or is close to graduating.

TIP! Take a large amount of credit hours to maximize your loan. To be considered a full-time student, you usually have to carry at least nine or 12 credits, but you can usually take as many as 18 credit each semester, which means that it takes less time for you to graduate.

Do not consider the idea that a default on your student loan will give you freedom from your debt. The government has many ways to get the money. A couple of tactics they use to collect the money you owe is taking some tax return money, Social Security and even wage garnishment at your job. The government even has the right to take up to fifteen percent of what it deems your disposable income. You will probably be worse off than before in some cases.

Do not rely on student loans in order to fund your entire education. Remember to also seek out grants and scholarships, and look into getting a part time job. Locate the numerous scholarship matching websites designed to assist you in locating the perfect scholarships and grants. Try not to delay and get out and get looking as quickly as possible.

TIP! Two superior Federal loans available are the Perkins loan and the Stafford loan. These two are considered the safest and most affordable.

When you apply for financial aid, make sure your application is error free. Your accuracy may have an affect on the amount of money you can borrow. If you are confused about the form, consult with a counselor at your high school.

To extend to value of your loan money, try to get meal plans that do not deduct dollar amounts, but rather include whole meals. This way you won’t get charged extra and will only pay one fee per meal.

TIP! Look into PLUS loans for your graduate work. The interest rate on these loans will never exceed 8.

Stay in contact with your lender. This is essential since you need to know all about your loans and stipulations within your repayment plans. Lenders can also give you advice about paying your loans off.

Student Loans

TIP! Private student loans should be considered carefully before you sign. It can be difficult to figure out what the terms are exactly.

Student loans can be complicated, so it is important to learn as much as you can. The choices you make now can affect you far into the future. Borrowing in a prudent manner is vital, so use this information when you start looking for student loans.