Getting through college is hard enough. Thinking about how you are going to pay for it is even more difficult. Student loans are one opportunity many students are using. Keep reading for some great tips on how to get the most from your experience with obtaining and paying off student loans.
Start your student loan search by looking at the safest options first. These are generally the federal loans. They are immune to your credit rating, and their interest rates don’t fluctuate. These loans also carry some borrower protection. This is in place in case of financial issues or unemployment following your graduation from college.
Know your grace periods so you don’t miss your first student loan payments after graduating college. Stafford loans typically give you six months before starting payments, but Perkins loans might go nine. Private loans are going to have repayment grace periods of their own choosing, so read the fine print for each particular loan.
When paying off student loans, do it using a two-step process. Begin by figuring out how much money you can pay off on these student loans. After that, pay extra money to the next highest interest rate loan. It’ll help limit your spend over a given time.
Be careful when consolidating loans together. The total interest rate might not warrant the simplicity of one payment. Also, never consolidate public student loans into a private loan. You will lose very generous repayment and emergency options afforded to you by law and be at the mercy of the private contract.
Go with the payment plan that best suits your needs. Many student loans will offer a 10 year repayment plan. If this won’t work for you, there may be other options available. For instance, you can possibly spread your payments over a longer period of time, but you will have higher interest. You may also have the option of paying a percentage of income you earn once you start earning it. Certain types of student loans are forgiven after a period of twenty-five years.
For those having a hard time with paying off their student loans, IBR may be an option. This is a federal program known as Income-Based Repayment. It can let borrowers repay federal loans based on how much they can afford instead of what’s due. The cap is about 15 percent of their discretionary income.
To get the most out of your student loan dollars, take as many credit hours as possible. Though full-time student status requires 9-12 hours only, if you are able to take 15 or more, you will be able to finish your program faster. This helps to lower your loan amounts.
To keep your overall student loan principal low, complete your first two years of school at a community college before transferring to a four-year institution. The tuition is significantly lower your first two years, and your degree will be just as valid as everyone else’s when you graduate from the larger university.
Keep in touch when you have a lender that’s giving you money. This is key, because you will need to stay aware of all loan terms and details of repayment. It is also possible that the lender offers you advice with regard to repayment.
To make sure that you do not lose access to your student loan, review all of the terms before signing the paperwork. If you do not register for enough credit hours each semester or do not maintain the correct grade point average, your loans can be at risk. Know the fine print!
As stated above, there one thing more difficult than getting through college for most students. Paying for it is even more of a hardship. Make use of the tips and tricks listed above. They will help you pay for your college education and get the most out of it.