Create a repayment schedule
First, you should draft a repayment schedule for paying back the loan as soon as you get in debt, irrespective of whether you need to start the actual repayments yet. The plan will help you stay on top of the loan at all times and make you more aware of the things you need to do. It can help you prepare for the future and be a crucial part of saving up for the rainy days.
Remember that most federal and private student loans don’t have restricting rules and regulations for making repayments even when you aren’t contractually obliged. Therefore, chopping off a piece of the student loan whenever you can is a good idea.
Create a repayment plan for:
• While in school – For example, if you have a private loan, you should start making interest repayments immediately.
• After school – What is the maximum you can repay without losing sleep.
Consider your repayment model carefully
As the above section highlighted, you have plenty of options when it comes to repaying the loan. Certain options above are better suited for different situations. For instance, while the Standard Repayment Plan means you pay less over time, you can finish repayments quicker under the income-based plans. If you have a good income, repaying the loan shouldn’t be a problem and you have the protection of getting the loan forgiven if you can’t payback in time.
Keep in mind that in most instances the repayment model can be changed from one type to another. This can be useful option if your life situation changes d...
... middle of paper ...
...Try changing the repayment plan and renegotiate the terms with the lender. If you notice the problems before you fall behind on your repayments, the lenders are more likely to help.
Consider refinancing your loan. For example, it is possible to refinance you federal loans and turn them into private loans. Refinancing could potentially provide you better loan terms, such as lower interest rate. But remember that refinancing federal loans to private loan will mean you forfeit access to loan forgiveness.
Finally, consider getting your student loan forgiven. If you work in public service, you can speed up loan forgiveness of your federal loan. Furthermore, deferment or forbearance are also options to consider, but you definitely want to avoid these if you can. These mean you can take time off from repayments, but remember that they will increase the total loan balance.
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