With the high price of college tuition these days, many graduates are interested in knowing how to refinance student loans. By refinancing college debt and consolidating into one low-interest loan, recent grads can ease their financial burden and also save thousands of dollars by the time the entire loan is paid. For anyone who is not familiar with student loan refinancing, this is generally taking out a new loan at a low interest rate and using the money from that loan to pay off various student loans. A student loan refinance will generally make it easier for students to make their loan payment by either locking in a lower interest rate or by extending the term of the loan. Obviously, the former is preferable, but not always possible.
One of the options you can consider will be a payment plan for financial hardship. There are many of such plans and you can choose depending on your specific needs and the type of loan you have to pay. The Income Contingent Repayment Plan is designed to allow you to make a monthly payment based on the percentage of your current salary. You can make payments for as low as $5 and the government can cancel the remaining balance if you have not been able to pay your debt for after 25 years. The Income Sensitive Repayment Plan is available for FFEL loans and is calculated with due consideration on your annual income, the size of your family, and the total amount to be settled for the loan. If you have a Perkins Loan, you can use the Hardship Repayment Plan which allows you to pay at least $40 monthly. The school reserves the right to extend the loan to a period ten years or more especially if you are unemployed or suffer from illness.
For loans that may not be through a financial aid office, consider asking the lender for a consolidation. While there is no guarantee, a lender will want to retain business and may consider this as an option. Community banks or local banks offer great refinancing services and are interested in young people and college graduates just starting out in life. The loan officers at a local bank or credit union will be available to meet and talk about refinancing loans locally. They will either be able to help or offer further guidance. This expertise is invaluable, so take advantage of local banks.
A federal program that may also be an asset is the US Department of Education's Direct Loan Program. Direct Loans are funded by the USDE through schools and managed by a loan servicer. This program allows students to choose a repayment plan and also offers the versatility to change plans if needed. Some options with this program for students saddled with debt are to switch to a public service career where it may be possible to have a loan discharged after 10 years in public service.
The lender can give you the permission to completely stop making the payments or to reduce your payments due to reasons such as poor health, unemployment, or other unforeseen hardships. You can also find many reasons to apply for loan cancellation. In some situations you can only cancel part of the loan, but there are certain requirements to be met. If you were enrolled in an institute that closed down while you were there, you may qualify for loan cancellation.
There are student loan repayment programs that are suitable for people with hardships and you can make the best use of them. The Income Contingent Repayment Plan calculates your monthly payment based on your current salary, and you can pay for as low as $5. In the event that you have not been able to pay for the loan for over 25 years, the government can cancel the loan. There are many programs for student loan debt relief, and if you take time to shop around, you'll certainly find one that is designed to meet your needs.
One of the options you can consider will be a payment plan for financial hardship. There are many of such plans and you can choose depending on your specific needs and the type of loan you have to pay. The Income Contingent Repayment Plan is designed to allow you to make a monthly payment based on the percentage of your current salary. You can make payments for as low as $5 and the government can cancel the remaining balance if you have not been able to pay your debt for after 25 years. The Income Sensitive Repayment Plan is available for FFEL loans and is calculated with due consideration on your annual income, the size of your family, and the total amount to be settled for the loan. If you have a Perkins Loan, you can use the Hardship Repayment Plan which allows you to pay at least $40 monthly. The school reserves the right to extend the loan to a period ten years or more especially if you are unemployed or suffer from illness.
For loans that may not be through a financial aid office, consider asking the lender for a consolidation. While there is no guarantee, a lender will want to retain business and may consider this as an option. Community banks or local banks offer great refinancing services and are interested in young people and college graduates just starting out in life. The loan officers at a local bank or credit union will be available to meet and talk about refinancing loans locally. They will either be able to help or offer further guidance. This expertise is invaluable, so take advantage of local banks.
A federal program that may also be an asset is the US Department of Education's Direct Loan Program. Direct Loans are funded by the USDE through schools and managed by a loan servicer. This program allows students to choose a repayment plan and also offers the versatility to change plans if needed. Some options with this program for students saddled with debt are to switch to a public service career where it may be possible to have a loan discharged after 10 years in public service.
The lender can give you the permission to completely stop making the payments or to reduce your payments due to reasons such as poor health, unemployment, or other unforeseen hardships. You can also find many reasons to apply for loan cancellation. In some situations you can only cancel part of the loan, but there are certain requirements to be met. If you were enrolled in an institute that closed down while you were there, you may qualify for loan cancellation.
There are student loan repayment programs that are suitable for people with hardships and you can make the best use of them. The Income Contingent Repayment Plan calculates your monthly payment based on your current salary, and you can pay for as low as $5. In the event that you have not been able to pay for the loan for over 25 years, the government can cancel the loan. There are many programs for student loan debt relief, and if you take time to shop around, you'll certainly find one that is designed to meet your needs.
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Before you make any choices, make sure you read Rick's solid blog on federal student loan forgiveness programs and how you can handle student loan debt
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