Have you seen the cost of college recently? If so, you know how pricey it is. It is uncommon for a student to be able to fully pay their own way through school. If finding a way to pursue higher education is important to you, take a look at student loans.
If you have any student loans, it’s important to pay attention to what the pay back grace period is. This is generally the period after graduation when the payments are due. Being aware of this will help you get a jump start on payments, which will help you avoid penalties.
Stay in contact with all lenders. Make sure you update them with your personal information if it changes. 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 whatever actions are necessary as soon as you can. If you miss any piece of information, you may end up spending more money.
Focus initially on the high interest loans. If you solely base your repayment by which ones have a lower or higher balance, then you might actually end up paying back more in the end.
Grace Period
Be aware of the amount of time alloted as a grace period between the time you complete your education and the time you must begin to pay back your loans. For Stafford loans, the period is six months. Perkins loans have a nine month grace period. Other loans will vary. Be sure you know exactly when you will be expected to begin paying, and don’t be late!
Pick out a payment option that you know can meet the needs you have. Many of these loans offer a ten year repayment period. If this doesn’t work for you, you may have other options. Understand if you choose a longer repayment period you will end up having to pay more in interest. Once you start working, you may be able to get payments based on your income. Some balances are forgiven if 25 years have passed.
If you don’t have a lot of “extra” money, student loans can really make life difficult for you. There are frequently reward programs that may benefit you. For examples of these rewards programs, look into SmarterBucks and LoanLink from Upromise. These are essentially programs that give you cash back and applies money to your loan balance.
The Perkins Loan and the Stafford Loan are both well known in college circles. Many students decide to go with one or both of them. This is a great deal that you may want to consider. Perkins loans have an interest rate of 5%. The Stafford loans are a bit higher but, no greater than 7%.
If you need for a student loan and do not have good credit, you may need a cosigner. It is vital you keep current with all your payments. Otherwise, the other party must do so in order to maintain their good credit.
You aren’t free from your debt if you default on your loans. There are ways that the government can collect the money against your wishes. For example, it can step in and claim a portion of your tax return or Social Security payments. They can also claim up to fifteen percent of your income that is disposable. Generally speaking, you will be far worse off.
Don’t think that student loans should be depended on totally. Be sure to save up as much money as possible, and take advantage of grants and scholarships too. Do a quick Google search to find websites that can match you up with scholarships that are available for your specific situation. Make sure you start your search soon so you can be prepared.
While student loans can help make college affordable for a number of people, they must be repaid. Lots of people get loans and never stop to think about paying them back. Use what you’ve just learned to get a student loan with the best terms.
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