Since college costs only continue to rise, student loans are nearly a universal part of student life. Getting the right kind of loans under the right terms is possible, but not without a good amount of advance information. Here is a great place to begin.
Always know the pertinent details of 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 facts will determine your loan repayment and forgiveness options. This also helps when knowing how prepare yourself when it comes time to pay the money back.
Make sure you are in regular contact with the lender. Always update them anytime your address, email or phone number changes, which can happen a lot during college. Also, make sure that you immediately open and read every piece of correspondence from your lender, both paper and electronic. Take action right away. Failing to miss any deadlines or regulations can mean risking losing quite a bit of money or time.
Don’t be driven to fear when you get caught in a snag in your loan repayments. Many people have issues crop up unexpectedly, such as losing a job or a health problem. There are forbearance and deferments available for such hardships. Still, remember that your interest will have to be paid back, so try and pay what you can, when you can.
If you are in the position to pay down your student loans, make the high interest loans your first priority. If you get your payments made on the loans that have the lowest or the highest, it can cost you extra in the end.
Select the payment option best for your particular needs. Many of these loans have 10-year repayment plans. If this isn’t working for you, there could be a variety of other options. For example, you might take a long time to pay but then you’ll have to pay a lot more 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.
To help with paying off your loans, start paying off the loans by order of the interest rate that comes with each. Try to pay the highest interest loans to begin with. Using your extra cash can help you get these student loans paid off quicker. There is no penalty for paying off your loans early.
Take as many hours each semester as you think you can handle so you don’t waste any money. Generally, being a full-time student is seen as 9 to 12 hours per semester, but if you can squeeze in between 15 or 18, then you should be able to graduate sooner. This helps reduce the total of loans.
To expedite the process of a student loan, make sure the application is filled out accurately. Giving incorrect information can cause the process to be delayed, resulting in having to start school later.
If your credit isn’t the best, and you want to apply for private student loans, then you will probably need a co-signer. It’s a good idea to stay up to date with the payments you make. If you don’t keep up with payments on time, your co-signer will be responsible, and that can be a big problem for you and them.
A PLUS loan is a loan that can be secured by grad students as well as their parents. Their interest rate does not exceed 8.5%. This rate exceeds that of a Perkins loan or a Stafford loan, but is lower than private lenders offer. These loans are much better suited to an older student that is at graduate school or is close to graduating.
Defaulting on a loan is not freedom from repaying it. The government can get back this money if they want it. For instance, you might see money withheld from Social Security payments or even your taxes. The government may also try to take up around 15 percent of the income you make. In a lot of cases, you’ll be in a worse place than you already were.
It doesn’t take long to owe a lot of money for school. Sadly, when a student takes out a loan, they may find themselves falling onto to hard times in the future. This will help to prevent you from experiencing hardships with your loan.