Anyone who has considered college recently has been shocked by the levels to which tuition has risen. Most families simply can’t pay for it all by themselves. If you want to figure out what you can do to afford schooling, getting a student loan is a good option.
Make sure you know what the grace period is for your loans before you need to start making payments. The grace period is the time you have between graduation and the start of repayment. This can also give you a big head start on budgeting for your student loan.
Remain calm if you discover that can’t make your payments due to an unforeseen circumstance. Many times a lender will allow the payments to be pushed back if you make them aware of the issue in your life. Just be mindful that doing so could make your interest rates rise.
Use a process that’s two steps to get your student loans paid off. First, ensure you meet the minimum monthly payments on each separate loan. Second, you will want to pay a little extra on the loan that has the higher interest rate, and not just the largest balance. This will cut back on the amount of total interest you wind up paying.
Make sure your payment option fits your specific situation. Many of these loans have 10-year repayment plans. There are other options if this doesn’t work. For example, you might take a long time to pay but then you’ll have to pay a lot more in interest. You can also possibly arrange a deal where you pay a certain percentage of your overall post-graduation income. Some student loans are forgiven once twenty five years have gone by.
When you’re trying to pay off a student loan, be sure you pay them in order of interest rates. The loan with the individual highest rate needs paid down fastest and first. By concentrating on high interest loans first, you can get them paid off quickly. There are no penalties for early payments.
For those on a budget already stretched to the max, the idea of a student loan can be scary. There are loan rewards opportunities that can help. Look at websites such as SmarterBucks and LoanLink to learn about this kind of program offered by Upromise. Similar to popular cash-back programs, each dollar spent accrues rewards that are applied against your loan balance.
Squeeze in as many possible credit hours as you can to maximize your student loans. The more credits you get, the faster you will graduate. This helps you minimize the amount of your loans.
Never sign anything without knowing what exactly it says and means. Asking questions and understanding the loan is essential. Don’t let the lender take advantage of you.
The Stafford and Perkins loans are the best options in federal loans. These two are considered the safest and most affordable. It ends up being a very good deal, because the federal government ends up paying the interest while you attend school. The Perkins loan carries an interest rate of 5%. The Stafford loans which are subsidized come at a fixed rate which is not more than 6.8%.
Many students think of college loans as free money, but that is not the reality. Often students borrow money to pay for college without a thought to the practical aspect of repaying it. These suggestions should help you to avoid many of the common pitfalls.
Lapo is a smart home, technology, health, wealth, and fitness enthusiast. If he’s not on tour, you’ll find him in New York with his wife and pet parrot hanging out at the park.
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