10 Strategies for Dealing with Student Loans

10 Strategies for Dealing with Student Loans

10 Strategies for Dealing with Student Loans

it is Difficult to live with student loans, and for many, hard to live without Few questions the value of post-secondary education, whether it be in a technical field, for a skilled trade, or for a four-year (or more) degree. More education frequently yields a better, fuller life as well as more income. But with the cost of education rising fast and the job market expanding slowly, there is a growing disconnect between the cost and the benefit. This is demonstrated by the default rate of student loans, which has been on an upward trend, with a recent two-year default rate of 10 percent and a three-year default rate of 14.7 percent. So how do you get the benefits you want and need without the risk of owing more than you can pay? This article is just what you’re looking for, with my favorite heads-up advice to keep you moving in the right direction.
Differently, Than Other Loans, Most of the loans that are reported on your credit bureau files get reported just once. Student loans are an exception. Based on how your education is funded, you may have a new loan every midyear. That equates to two loans per year, or a total of eight loans hitting your credit report while you are preparing to make some money to pay them back. All this activity can build your credit score, but because there are so many of the little darlings,  they can sink you big-time if you end up defaulting
10 Strategies for Dealing with Student Loans
1- Knowing How Student Loans Are
Reported they can sink you big-time
 if you end up defaulting.
2- Dealing with the Collection Process
Now that you know the stakes are high, you’ll want to handle any collection process quickly. The key to minimizing damage from a defaulted student loan is to address it right away. Don’t procrastinate or ignore the letters and calls. some Private student loans may charge fees within 120 days instead of traditional fees180 days for normal loans. Early action can enable you to handle loan issues quickly with the servicer rather than a collection agency.

Now that you know the stakes are high, you’ll want to handle any collection process quickly. The key to minimizing damage from a defaulted student loan is to address it right away. Don’t procrastinate or ignore the letters and calls. some Private student loans may charge fees within 120 days instead of traditional fees180 days for normal loans. Early action can enable you to handle loan issues quickly with the servicer rather than a collection agency. 
3-Taking Your Loans to Bankruptcy
Because the value of your education can’t be repossessed, a student loan generally can’t be wiped out in a bankruptcy
10 Strategies for Dealing with Student Loans
Because the value of your education can’t be repossessed,
 a student loan generally can’t be wiped out in a bankruptcy
4- Identifying the Best Repayment  Option for Your Situation
Standard Repayment Plan: Payments are fixed and made for up to ten years. This plan may save you money over time. Although your monthly payments may be slightly higher than payments made under other plans, you’ll pay off your loan in the shortest time. ✓ Graduated Repayment Plan: Payments are made for up to ten years.   If your current income is low and you expect that it will go up and continue to rise over an extended period, the GRP may be a good bet. ✓ Extended Repayment Plan: Payments are made for up to 25 years. The good news: lower payments. The bad news: You pay more interest and pay more overall for longer. You must extend a minimum of $30,000 in outstanding Federal Family Education Loans (FFEL) or Direct Loans. Some important options for student loan borrowers are based on your earnings. Forgiveness may be available after 10 to 25 years of these payments, depending on the plan you choose. ✓ Income-Based Repayment Plan (IBR) caps your monthly payment amount at an amount that the government thinks is affordable based on your income and family size.
10 Strategies for Dealing with Student Loans
* Standard Repayment Plan: Payments are fixed and made for up to ten years. This plan may save you money over time. Although your monthly payments may be slightly higher than payments made under other plans, you’ll pay off your loan in the shortest time.
* Graduated Repayment Plan:
 Payments are made for up to ten years. 
 If your current income is low and you expect that it will go up and continue to rise over an extended period, the GRP may be a good bet.
* Extended Repayment Plan: 
Payments are made for up to 25 years. The good news: lower payments. The bad news: You pay more interest and pay more overall for longer. You must extend a minimum of $30,000 in outstanding Federal Family Education Loans (FFEL) or Direct Loans.
Some important options for student loan borrowers are based on your earnings. Forgiveness may be available after 10 to 25 years of these payments, depending on the plan you choose.
* Income-Based Repayment Plan (IBR) caps your monthly payment amount at an amount that the government thinks is affordable based on your income and family size.
5- Gaining Student Loan Forgiveness
In most cases, your loans are yours to have and to hold until you pay them back or expire trying. However, on some occasions, student loans may be forgiven, canceled, or discharged. Following is a summary of the types of loan absolution that are available.
10 Strategies for Dealing with Student Loans
In most cases, your loans are yours to have and to hold until you pay them back or expire trying. However, on some occasions, student loans may be forgiven, canceled, or discharged. Following is a summary of the types of loan absolution that are available.
6- Lowering Your Bill While You’re in School
There is no need to let the bill for your student loans grow while you’re in school. Unless you have a subsidized loan, interest accrues and accumulates during the term of your education. Keep in mind these strategies to minimize or eliminate your attention.
There is no need to let the bill for your student loans grow while you’re in school. Unless you have a subsidized loan, interest accrues and accumulates during the term of your education. Keep in mind these strategies to minimize or eliminate your attention.
7- Keeping Up with Your Loans 
 After You’re Out to Remember, federal student loans are real loans, just like car loans or mortgages.  You must repay your student loans even if your financial circumstances become  difficult. Your student loans cannot be canceled because you didn’t get the job you expected or you didn’t complete your education (unless you couldn’t complete your education because your school closed.
10 Strategies for Dealing with Student Loans
After You’re Out to Remember, federal student loans are real loans, just like car loans or mortgages.
You must repay your student loans even if your financial circumstances become difficult. 
Your student loans cannot be canceled because you didn’t get the job you expected or you didn’t complete your education (unless you couldn’t complete your education because your school closed.
8- Setting Limits During the Planning and Application Process
Beware of passion and peer pressure. Setting your financial limits early in the game saves you from your emotions sure to surface as you narrow down your choices. Start by assigning a value to the education you're looking for in the field you're planning to enter. Don’t know your career choice yet? Then I strongly suggest that you minimize loans until you do. Consider community colleges. Like buying a house before you know where you’ll be working or what you can afford, buying an expensive education without knowing what type of job or salary you’re likely to get is a mistake.
10 Strategies for Dealing with Student Loans
Beware of passion and peer pressure. Setting your financial limits early in the game saves you from your emotions sure to surface as you narrow down your choices. Start by assigning a value to the education you're looking for in the field you're planning to enter. Don’t know your career choice yet? Then I strongly suggest that you minimize loans until you do. Consider community colleges. Like buying a house before you know where you’ll be working or what you can afford, buying an expensive education without knowing what type of job or salary you’re likely to get is a mistake.
9- Getting Help if You’re in the Military
The GI Bill (gibill.va.gov) offers substantial benefits to service personnel who have at least 30 days of active duty. More than one program is available,   and programs typically offer tuition, books, and housing allowances. Here are   three simple steps to consider:   Reduce your interest rates  Select payment based on income (IBR) and public service loan Forgiveness (PSLF)  Manage your private loans.
10 Strategies for Dealing with Student Loans
The GI Bill (gibill.va.gov) offers substantial benefits to service personnel who have at least 30 days of active duty. More than one program is available, and programs typically offer tuition, books, and housing allowances. Here are  three simple steps to consider:
 Reduce your interest rates
Select payment based on income (IBR) and public service loan Forgiveness (PSLF) Manage your private loans.
10- Dealing with the Prospect of Default
Before you are late for your loan, you must have exhausted your grace period (the length of time you have after leaving school before you have to  make your first payment).
10 Strategies for Dealing with Student Loans
Before you are late for your loan, you must have exhausted your graceperiod (the length of time you have after leaving school before you have to 
make your first payment).