Going to college is quite expensive. There’s not a lot of folks who can currently pay for a college education just out of their pocket. A student loan is a great way to help finance the cost of a college education.
Always know all of the key details of any loan you have. 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. You have to have this information if you want to create a good budget.
Keep in touch with the lender you’re using. Make sure your records are updated, such as your phone number and address. Anytime you receive a phone call, email or paper letter from your lender, pay attention to it as soon as it is received. You need to act immediately if a payment is needed or other information is required. Failure to miss anything can cost you a lot of money.
Pay your student loans using a 2-step process. First you need to be sure that you know what the minimum payments for the loans will be each month. Next concentrate on paying the largest interest rate loan off first. This will make it to where you spend less money over a period of time.
Know how long you have between graduation and the commencement of loan payments. If you have Stafford loans, you will usually have about 6 months. Perkins loans offer a nine-month grace period. Other loans offer differing periods of time. Understand when your first payments will be due so that you can get on a schedule.
Choose the payment option that is best suited to your needs. 10 years is the default repayment time period. Other options may also be available if that doesn’t work out. As an example, it may be possible to extend your payment time, but typically that’ll include a higher interest rate. You may also have to pay back a percentage of the money you make when you get a job. Some loans’ balances get forgiven after 25 years.
You may feel overburdened by your student loan payment on top of the bills you pay simply to survive. Loan rewards programs can help a little with this, however. For instance, look into the Upromise programs called SmarterBucks and LoanLink. The are akin to cash back incentives, and the money spent works like a reward you can use toward your loan balance.
Take more credit hours to make the most of your loans. Sure a full time status might mean 12 credits, but if you can take 15 or 18 you’ll graduate all the quicker. This will assist you minimizing your loan amounts.
Your student loan application must be filled out correctly in order to be processed as soon as possible. If you make any errors on the paperwork, this can cause a hold up in your getting the loan, which could cause you to be unable to pay for school when the semester starts.
The simplest loans to obtain are the Stafford and Perkins. They are the safest and least costly loans. One of the reasons they are so popular is that the government takes care of the interest while students are in school. The Perkins loan has an interest rate of 5%. The Stafford loans are a bit higher but, no greater than 7%.
Bad credit will mean you need a cosigner on a private loan. Make sure you keep every payment. If not, your co-signer will be held responsible.
There is a loan that is specifically for graduate students or their parents known as PLUS loans. The interest rates on these are kept reasonable. Although this is greater than Perkins loans and Stafford loans, it’s much better than the private loan rates. This may be a suitable option for your situation.
Your school might have motivations of its own when it comes to recommending certain lenders. Schools sometimes lend their name to private loan companies for a mutual benefit. This is somewhat misleading. The school may get some kind of a payment if you go to a lender they are sponsored by. Make sure that you are aware of all the stipulations involved in a loan prior to taking it.
Only pay for the meals that you eat; get a meal plan to save money. This will prevent getting charged for extras and allows you to just pay a flat price for every meal you eat.
Make sure the lender always has your updated contact information. This is key, because you will need to stay aware of all loan terms and details of repayment. Additionally, your lender might give you some good information about repayment.
Know what your repayment options are. If paying back the loan will be an issue once you complete school, you may want to consider a graduated repayment plan. This makes your first payments smaller and they get bigger gradually over time, when you are hopefully making more money.
If you can’t pay your bill, call the lender. They reward proactive people by being able to help them more efficiently and provide more options. You may be offered a deferment or a reduction in the payment.
Stay in touch with your lender before and after college. If you have important contact information changes, or a name change, it is crucial that you inform your lender. This will enable you to stay up to date with any term changes. Also note that you are obligated to inform them of the date of your graduation or if you change schools or withdraw completely.
Many students think of college loans as free money, but that is not the reality. Some folks take out student loans without considering how they are going to pay for them. As you can see, you do not need to go broke in order to attend college.