Student Loans: Advice For Students And Parents

It is often the case that people must obtain loans to get the education they seek. Still, that doesn’t make it an easy or enjoyable process. Thankfully, the information in the article below has excellent advice that teaches you tips on how to apply for student loans.

Know what kind of grace periods your loans offer. The grace period is the amount of time between your graduation date and date on which you must make your first loan payment. Keep this information handy and avoid penalties from forgetting your loans.

Keep in contact with the lender. Always let them know when you change your phone number, mailing address or email address, and these things can happen often when you are in college. Be certain you always open mail that comes from your lender, and that includes e-mail. Do whatever you need to as soon as you can. Failure to miss anything can cost you a lot of money.

Attend to your private college financing in a timely manner. Student loans from the government are plentiful, but they come with a lot of competition. A private student loan has less competition due to many people being unaware that they exist. Talk to people you trust to find out which loans they use.

Use a process that’s two steps to get your student loans paid off. First, make sure that you meet the minimum monthly payments of each individual 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 reduce your spending in the future.

Grace Period

Pay attention to how long the grace period is after your graduation before you student loan has to be repaid. For Stafford loans, you should have six months. A Perkins loan gives you a nine month grace period. Different loans will be different. Make sure you know how long those grace periods are, and never pay late.

Make sure that you specify a payment option that applies to your situation. Many student loans offer 10-year payment plans. There are other options if you can’t do this. For example, you may be able to take longer to pay; however, your interest will be higher. It may also be possible for you to dedicate a portion of your salary to loan repayment once you have a regular paycheck coming in. It may be the case that your loan is forgiven after a certain amount of time, as well.

Choose payment options that best serve you. Most loans have a 10-year repayment plan. There are other ways to go if this is not right for you. For example, you could extend the amount of time you have to pay, however you will probably have a higher interest rate. Your future income might become tied into making payments, that is once you begin to make more money. Sometimes student loans are forgiven after 25 years.

Anyone on a budget may struggle with a loan. A rewards program may help things. For examples of these rewards programs, look into SmarterBucks and LoanLink from Upromise. These give you rewards that you can apply toward your loan, so it’s like a cash back program.

To get student loans to go through quicker, fill out the documents properly. You might find your paperwork in a stack waiting to be processed when the term begins.

Stafford and Perkins are the best loan options. This is because they come with an affordable cost and are considered to be two of the safest loans. They are a great deal because you will get the government to pay your interest during your education. Perkins loan interest rates are at 5 percent. The Stafford loans are a bit higher but, no greater than 7%.

Be aware that you may need a co-signer for a private loan if your credit isn’t good. It is critical that you make all your payments in a timely manner. If you default, your cosigner will be responsible for the payments.

Certain Lenders

Keep in mind that your school could have other motivations when they recommend certain lenders. In some cases, a school may let a lender use the school’s name for a variety of reasons. This can be misleading. The school might get a payment or reward if a student signs with certain lenders. Know all about a loan prior to agreeing to it.

As this article said in the beginning, a lot of people get into student loans when they want to further their educations. Now that you’ve read this, you should know enough to make a good decision. Use this advice to make the student loan process simpler.

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