While there is no doubt that student loans can help you achieve a college education, they can also be disastrous. So it’s a good idea to get smart and learn about student loans before signing anything. Read this article to learn about what you should know before borrowing.
Know what kind of grace periods your loans offer. This usually refers to the amount of time you are allowed after you graduate before repayments is required. Staying aware of when this period ends is the right way to make sure you never have late payments.
Read the fine print on student loans. You want to keep track of your balance, who your lender is and any current repayment status of your loans. These three things will affect future repayment plans and forgiveness options. Budgeting is only possible with this knowledge.
Make sure you stay in close contact with your lenders. Notify them if there are any changes to your address, phone number, or email as often happens during and after college. Also, be sure you immediately read any kind of mail you get from a lender, whether it’s electronic or paper. You should take all actions immediately. Failure to miss anything can cost you a lot of money.
Consider private funding for your college education. Public student finances are popular, but there are also a lot of others seeking them. Private loans – especially small ones – do not have as much competition, and this means that there is funding available that most other people don’t even know about. Explore the options in your community.
Think about what payment option works for you. Many student loans come with a 10-year plan for repayment. If this does not fit your needs, you may be able to find other options. For instance, you might have an option of paying over more years at the trade-off of higher interest. You might also be able to pay a percentage of your income once you begin making money. A lot of student loans will be forgiven after you’ve let twenty five years go by.
Choose a payment option based on your circumstances. Many student loans come with a ten year length of time for repayment. If this won’t work for you, there may be other options available. If you take a loan at a higher interest rate, for example, you can extend your time to pay. It may even be possible to pay based on an exact percentage of your total income. After 20 years, some loans are completely forgiven.
To make your student loan money stretch even farther, consider taking more credit hours. Generally, being a full-time student is seen as 9 to 12 hours per semester, but if you can squeeze in between 15 or 18, then you should be able to graduate sooner. This helps you minimize the amount of your loans.
As you can now see, there are many variables to consider regarding student loans. Whatever choices you make may impact your future. Smart borrowing is the way to go, and the tips in the above article should be remembered when you go to apply for a student loan.