Have you gone to college only to find that you are in debt up to your eyeballs? Student loans can be very scary! Paying student loans can be hard on a young person just starting out. Just remember that just because you have not landed that perfect job just yet does not mean that your student loans will go away all by themselves.
Paying student loans back is a great step to earning a solid financial foundation for your future. When you graduated from college the first thing most students think about is, “Time to relax for a few days then off to beat the streets for a job!” When that first student loan bill arrives in the mail it can be very nerve wracking and overwhelming. However, you can make the transition from college student to a professional career individual by understanding the repayment process of paying your student loans off.
Every financial institution knows that there will be times that a payer of sums owed will/may fall upon hard financial situations. Student loans cannot be canceled but there are ways to assist you with your circumstances. Your financial adviser will explain options such as:
- Making Payments
- Loan Service’s
- Choosing a Repayment Plan
- Loan Consolidation
- Deferment and Forbearance
- Forgiveness, Cancellation, and Discharge
- Understanding Default
- Resolving Disputes
Making Payments – Once you graduate you will be responsible for making payments to your loan servicer. Each loan servicer may have different ways and times that the payments should be submitted. *Note* it is the students responsibility to contact the loan server even if he or she has not received a bill.
Loan services – A company that collects payments on a loan, responds to customer service inquiries, and performs other administrative tasks associated with maintaining a loan on behalf of a lender. If you’re unsure of whom your federal student loan servicer is, you can look it up on www.nslds.ed.gov.
Choosing a repayment plan – When it comes time to repay your student loans you will have a few choices for what type of payment plan will best suit your needs. The type of payment plan you choose will determine the amount and length of time you will be paying.
Types of payment plans available:
- Standard Repayment Plan
- Graduated Repayment Plan
- Extended Repayment Plan
- Income-Based Repayment Plan (IBR)
- Pay As You Earn Repayment Plan
- Income-Contingent Repayment Plan
- Income-Sensitive Repayment Plan
- Consolidate Your Loans
Deferment and Forbearance – If your financial situation is hard such as, unemployed, food stamps, returning to school, or going into the military this is the type of payment plan you can chose to postpone or lower your payments.
Forgiveness, Cancellation, and Discharge – This service is for students who have become totally or permanently disabled, or the school closed while you were in attendance, and certain types of teaching services and other such situations. This will put your loan in forgiveness, cancellation, or removed.
Understanding Default – You never want to go into default with your student loans. The college, the loan servicer that made or owns your loan, loan guarantor, and the federal government all can take action to recover the money you owe.
A default with your student loans can affect
- Denied rentals on apartments/homes
- Higher deposits on utilities or denial of services
- Home owners insurance
- Cell phone services
If you need assistance with your loans, call your student adviser or contact your loan servicer today!