Need Help With Student Loans? Read This


You might start getting student loan offers in the mail while still far from finishing high school. It might seem like a really good deal that someone out there is willing to help you attain a college education. However, you should think about the following tips before you get into a student loan.

TIP! Read the fine print on student loans. You need to be mindful of your balance levels, your current lenders and your repayment status of each loan.

Know the specifics about your loan. You must watch your loan balances, check your repayment statuses, and know your lenders. These three things will affect future repayment plans and forgiveness options. This will allow you to budget effectively.

Stay in touch with the lender. When you make changes to your address or phone number, make sure you let them know. In addition, when you get mail from your lender, be sure to read everything. If the correspondence requests you take an action, do so as soon as you can. It can be quite costly if you miss anything.

TIP! Remain calm if you discover that can’t make your payments due to an unforeseen circumstance. A lot of the time a lender will allow a payment to be postponed if you show them you’re having a hard time.

There is hope for you if you find yourself in a tight financial spot where you cannot keep up with student loan payments. The lenders can postpone, and even modify, your payment arrangements if you prove hardship circumstances. However, you may pay an increase in interest.

Do not forget about private financing. Though federal loans are common, competition in the market does exist. Private student loans reside in a different category. Often, some of the money is never claimed because students don’t know about it. Ask around your city or town and see what you can find.

TIP! Don’t overlook private financing for your college years. There are plenty of public student loans to be had, but the competition to get them is fierce.

Never do anything irrational when it becomes difficult to pay back the loan. There is always something that pops up in a persons life that causes them to divert money elsewhere. Do know that you have options like deferments and forbearance available in most loans. Just be mindful that interest continues to accrue in many options, so at least consider making interest only payments to keep balances from rising.

Grace Period

TIP! Don’t panic if you aren’t able to make a loan payment. Life problems such as unemployment and health complications are bound to happen.

Keep in mind the time that’s allotted to you as your grace period from when you get out of school until you have to start paying back the loan. Many loans, like the Stafford Loan, give you half a year. Perkins loans have a nine month grace period. Other loans will vary. Know what you have to pay when, and pay on time!

Choose a payment option based on your circumstances. Most student loans allow for repayment over ten years. There are other options if this doesn’t work. If it takes longer to pay, you will face a higher interest charge. Your future income might become tied into making payments, that is once you begin to make more money. On occasion, some lenders will forgive loans that have gone unpaid for decades.

TIP! If you want to pay down student loans faster than scheduled, start with the highest interest rate loans first. If your payment is based on what loans are the highest or lowest, there’s a chance you’ll be owing more at the end.

Pay off student loans in interest-descending order. The loan with the individual highest rate needs paid down fastest and first. You will get all of your loans paid off faster when putting extra money into them. There is no penalty for paying off your loans early.

Monthly loan payments after college can be very intimidating. That can be reduced with loan rewards programs. Two such programs are SmarterBucks and LoanLink. These are similar to programs that give cash back. When you spend, you get rewards that you can use on loans.

TIP! It is important to know how much time after graduation you have before your first loan payment is due. If you have Stafford loans, you will usually have about 6 months.

Fill out paperwork for student loans with great accuracy to facilitate quick processing. Any information that is incorrect or incomplete can delay it being processed, potentially causing you to miss important deadlines and putting you behind in school.

Perkins Loans

TIP! Pick a payment option that works bets for you. A lot of student loans give you ten years to repay.

The Stafford and Perkins loans are the best options in federal loans. These two are considered the safest and most affordable. They are a great deal, because the government covers your interest while you are still in school. A typical interest rate on Perkins loans is 5 percent. The Stafford loans are subsidized and offer a fixed rate that will not exceed 6.8%.

Be aware that you may need a co-signer for a private loan if your credit isn’t good. Making payment on time is very important. If you fail to do so, the co-signer will be responsible for the payments.

TIP! When paying off your student loans, try paying them off in order of their interest rates. Pay off the one with the highest interest rate first.

Get rid of thinking that defaulting on a loan means freedom. The government will come after you. For example, the government can take a cut from your Social Security payments or your tax return. The government may also take 15 percent of your income. Usually, you will wind up being worse off than you were previously.

Make sure that you try to get scholarships when you go to college. Keep in mind that you need to put money aside and investigate grants and scholarships that may offer you some financial assistance. There are a lot of great websites that help you with scholarships so you can get good grants and scholarships for yourself. Try not to delay and get out and get looking as quickly as possible.

TIP! Pay off the loan with higher interest rates first so you can shrink the amount of principal you owe faster. If your principal is ower, you will save interest.

College is a time filled with lots of decisions, not the least of which is how much debt you take on. Choosing to borrow too much money, along with a higher interest rate can quickly add up to a big problem. Don’t neglect the information in this article; use it to help yourself make smart decisions.