The cost of a college degree can be a daunting amount. Fortunately student loans are available to help you but they do come with many cautionary tales of disaster. Simply taking all of the money you can get without considering how it affects your future is a recipe for disaster. So keep the following in mind as you consider student loans.
Once you leave school and are on your feet you are expected to start paying back all of the loans that you received. There is a grace period for you to begin repayment of your student loan. It is different from lender to lender, so make sure that you are aware of this.
Consider using your field of work as a means of having your loans forgiven. A number of nonprofit professions have the federal benefit of student loan forgiveness after a certain number of years served in the field. Many states also have more local programs. The pay might be less in these fields, but the freedom from student loan payments makes up for that in many cases.
Know how long you have between graduation and the commencement of loan payments. Stafford loans offer loam recipients six months. Perkins loans give you nine months. Make sure to contact your loan provider to determine the grace period. Make sure that you are positive about when you will need to start paying and be on time.
Paying your student loans helps you build a good credit rating. Conversely, not paying them can destroy your credit rating. Not only that, if you don’t pay for nine months, you will ow the entire balance. When this happens the government can keep your tax refunds and/or garnish your wages in an effort to collect. Avoid all this trouble by making timely payments.
Try looking at consolidation for your student loans. This can help you combine your multiple federal loan payments into a single, affordable payment. It can also lower interest rates, especially if they vary. One major consideration to this repayment option is that you may forfeit your deferment and forbearance rights.
To ensure that your student loan funds come to the correct account, make sure that you fill out all paperwork thoroughly and completely, giving all of your identifying information. That way the funds go to your account instead of ending up lost in administrative confusion. This can mean the difference between starting a semester on time and having to miss half a year.
If you have yet to secure a job in your chosen industry, consider options that directly reduce the amount you owe on your loans. For example, volunteering for the AmeriCorps program can earn as much as ,500 for a full year of service. Serving as a teacher in an underserved area, or in the military, can also knock off a portion of your debt.
To get a larger award when applying for a graduate student loan, only use your own income and asset information instead of including your parents’ data. This lowers your income level in most cases and makes you eligible for more assistance. The more grants you can get, the less you have to borrow.
To make collecting your student loan as user-friendly as possible, make sure that you have notified the bursar’s office at your institution about the coming funds. If unexpected deposits show up without accompanying paperwork, there is likely to be a clerical mistake that keeps things from working smoothly for your account.
The information above is just the beginning of what you should know as a student loan borrower. You should continue to educate yourself about the specific terms and conditions of the loans you are offered. Then you can make the best choices for your situation. Borrowing wisely today can help make your future that much easier.