Student Loan Repayment Is An Educated Requirement
There is one aspect of student loans that everyone who has taken them out understands…they will need to be repaid. How the new graduate approaches their educational obligation can make a huge difference in their financial well-being and failing to make good on the loans can result in a thick smudge on their credit reports. While nearly every recent graduate struggles with student loan repayment there are some things that can help reduce the burden.
There are a few things that the government will accept that allows part of student loans to be forgiven. Volunteering with certain organizations, military service, teaching in certain school districts or legal and medical service in certain locales can reduce the total amount of the student debt. Looking at these possibilities before beginning a student loan repayment schedule may help the student get out of a debt a lot faster.
The loan balance can also be reduced if the loans are subsidized by the government. With subsidized loans the government pays the interest rate during the grace period before student loan repayment begins and anything paid by the student is applied to the principal balance. Making payments during the grace period will reduce the total amount of the debt.
Do Not Put Off Admitting You Are Broke
People that deal with student loan repayment are used to getting calls from recent graduate telling them they are broke and are willing to work with them on getting their bills paid. By not calling them and explaining your circumstances, there is the risk will go into default and then the trouble can be worse than not making any student loan repayment.
Once a student goes into default on a loan they will not be able to receive any more student loans and the entire loan amount can become due and payable and an additional cost for collection, up to nearly 20 percent can be added to the student loan repayment total. If you have a job, garnishment of wages can be used in which 15 percent of your pay will be taken for student loan repayment and if you are due any income tax refunds they can also be withheld to repay the loan.
There are also circumstances in which a recent graduate may qualify for a deferment in making student loan repayment. Understand it is not necessarily forgiving the amount owed, just putting off when the student will have to start making payments.
