Student loan debt for easy repayment
What with the sky-high costs of higher education in our country, graduating with a massive student loan debt has become a pretty commonplace scenario nowadays. So, if you have left the university and are struggling with your monthly payment installments towards a student loan debt, you are not alone. However, there are several ways in which you can effectively ease the burden of your student loan liability and manage your finances more efficiently. Have a look.
The one basic step that you can take towards ensuring a better management of your multiple student loans is keeping track of their individual details including the name of the lending company, the different interest rates, your outstanding balance and the repayment status. This will help you determine the various repayment options that you might be eligible for and develop a feasible payback plan that would avoid any additional penalties or fees.
Determine your grace periods
Student loans typically come with a specific grace period that marks the time frame for which you can wait after graduation to start making your repayment contributions to the lender. For example, while the federal Perkins loans offer a nine-month grace period, the federal Stafford loans give you only a six month window before you start paying your loan back.
Pay off your most expensive loan first
It is always advisable to start with repaying a larger amount towards the student loan that comes with the highest interest rates first. For instance, if you have both federal as well as private student loan liabilities, you might consider getting rid of the latter first since most private lenders typically charge a higher rate of interest as compared to their government counterparts. Also, since private loans regularly lack the protection covers and flexible repayment options of the federal loans, it is safer to repay them first.
Consolidate your debt
A great way of reducing your monthly debt-related stress is consolidating your multiple student loans into a single more feasible liability. By consolidating your student loans you achieve the luxury of having to make a single payment (as opposed to the multiple installments) every month. In addition to this, debt consolidation in several cases can also effectively lengthen your pay off tenure, which implies that you now have a longer time to repay your debt.
Pick a Smart Repayment plan
If your standard repayment plan is becoming too hard for you to handle, you can check out the various repayment alternatives that you might be eligible for. All kinds of federal student loans offer alternative repayment plans including the income-driven repayment, income-based repayment, graduated repayment, extended repayment and Revised Pay as you earn for the borrowers to manage their debt more efficiently.
Consider Loan forgiveness
In case you work for a non-profit organization or the local government, you might be eligible for a loan forgiveness after you have paid your debt for 10 consecutive years. So under extreme circumstances when a borrower is unable to repay his debt following a bankruptcy, a permanent disability or the closure of his college before he could graduate, he can request a forgiveness, discharge or cancellation of his entire student loan debt.