A high school student can normally expect to begin receiving offers for student loans. It might seem like a really good deal that someone out there is willing to help you attain a college education. You need to think about this information first.
Make sure you know what the grace period is for your loans before you need to start making payments. This is the amount of time you are allowed after graduation before you loan becomes due. When you have this information in mind, you can avoid late payments and penalty fees.
Keep in close touch with your lender. Let them know if your number, email or address changes, all of which occur frequently during college years. Anytime you receive a phone call, email or paper letter from your lender, pay attention to it as soon as it is received. Take any and all actions needed as soon as possible. Neglecting something may cost you a fortune.
It is acceptable to miss a loan payment if serious extenuating circumstances have occurred, like loss of a job. Most lenders can work with you if you lose your job. If you take this option, you may see your interest rate rise, though.
When you graduate, know how much time you have before you have to start making payments on your loans. For Stafford loans, the period is six months. Perkins loans offer a nine-month grace period. For other loans, the terms vary. Do you know how long you have?
Identify and specifically choose payment options that are suited to your personal circumstances. In the majority of cases, student loans offer a 10 year repayment term. There are many other options if you need a different solution. For example, you might be given a longer time to pay. Keep in mind that this option comes with higher interest. You may have to pay a certain part of your income after you get some work. After 25 years, some loans are forgiven.
Pick out a payment option that you know will suit the needs you have. In most cases, 10 years are provided for repayment of student loans. If this doesn’t work for you, you might have another option. Perhaps you can stretch it out over 15 years instead. Keep in mind, though, that you will pay more interest as a result. You may also use a portion of your income to pay once you are bringing in money. On occasion, some lenders will forgive loans that have gone unpaid for decades.
When repaying student loan obligations, prioritize them by interest rate. Pay off the highest interest rate loan first. Using any extra cash available can help pay off student loans faster. Paying quicker than expected won’t penalize you in any way.
There are lots of decisions to make in college, and one of the biggest is about debt load. Choosing to borrow too much money, along with a higher interest rate can quickly add up to a big problem. So, keep in mind what you’ve gone over here while you get into college and being working on the future.