Most people know someone who suffers from a staggering amount of student debt. It is sad that so many young people borrowed without considering all their options and the end result of their actions. Continue reading for strategies on making the right decisions concerning your loans.
Remain in contact with your lender. Anytime there are changes to your personal information such as where you live, phone number, or email, it is important they are updated right away. It is also important to open and thoroughly read any correspondence you receive from your lender, whether it is through traditional or electronic mail. Take any necessary actions as soon as you can. You may end up spending more money otherwise.
Don’t panic if you can’t make a payment due to job loss or another unfortunate event. Generally, your lender will work with you during difficult situations. Just keep in mind that doing this might cause the lender to raise the interest rate on your loan.
Private financing is something that you may want to consider. Public loans are available, but there is often a lot of competition for them. Many people do not know about private loans; therefore, they are usually easier to get. Ask locally to see if such loans are available.
Try not to panic if you can’t meet the terms of a student loan. Many people have issues crop up unexpectedly, such as losing a job or a health problem. Remember that forbearance and deferment options are widely available on a lot of 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.
If you are in the position to pay off student loans early and inclined to do so, make sure you begin with the loans that carry the highest rate of interest. You may owe more money if you don’t prioritize.
Check the grace period of your student loan. For Stafford loans, you should have six months. If you have Perkins loans, you will have 9 months. Other types of student loans can vary. Keep in mind exactly when you’re supposed to start paying, and try not to be late.
Pay off student loans in interest-descending order. Pay loans with higher interest rates off first. Apply any extra dollars you have to pay off student loan balances faster. The is no penalty for early repayment.
If you don’t have a lot of “extra” money, student loans can really make life difficult for you. There are loan rewards opportunities that can help. Check out programs from Upromise such as SmarterBucks and LoanLink. These allow you to earn rewards that help pay down your loan.
To make your student loan money stretch even farther, consider taking more credit hours. Sure a full time status might mean 12 credits, but if you can take 15 or 18 you’ll graduate all the quicker. This lets you minimize the loan amounts you have to accrue.
A PLUS loan is specifically oriented to address the needs of graduate students and/or parents. These loans do not have a large interest rate compared to private loans. Although this rate is higher than that of the Perkins and Stafford loans, it is lower than the rates charged for private loans. It might be the best option for you.
It can be hard to jump into the workforce with a lot of debt ahead of you. Make sure you know what you are doing before you enter into that student loan. The tips above are for anyone considering taking out loans to further their education.