Own Your Loan, Don't Let Your Loan Own You

It is often said that the most effective debt management strategy is to be debt-free. But, in order to pay for your college education, you may need to take out student loans. The hope is your student loans can greatly assist in furthering your education. but there are some instances that getting student loans has lead people to be buried deep in debt.

Now, planning for successful repayment involves a certain amount of planning. The planning should start before you place your pen on your first promissory note. Just as you are making a commitment to your career by way of investing time and money in higher education, you should also make a commitment to your financial future by way of effectively managing your student loans from the beginning.

Here are some recommended tips and tactics that may help you handle your student debt effectively and repay the loans successfully.

Tip #1: Do Your Research: Always note that not all loans are the same. Some of them, such as the ones provided by the Indiana Secondary Market for instance, offer benefits during school as well as after graduation in the form of repayment incentives, while other do not.

Tip #2: Pay Attention to the Mail: Typically, every borrower receives important information regarding the student loan he or she took out.

Tip #3: Be Organized: When taking out student loan from a particular institution, it is always best to save all of your student loan documents and correspondences. This makes you aware of what exactly you've agreed, what is expected from you as a student loan borrower, and how much you have borrowed. Also, when setting up your record-keeping system, make sure you will find easy to maintain over the life of the loan.

Tip #4: Be present at All Required Entrance and Exit Sessions: When you take out student loan, you will be required to complete student loan counselling sessions. This is often considered when you first obtain the loan and upon graduation.

Tip #5: Learn to Manage Money like an Expert: It has been said that if you live like a professional while you are in school, you will live like a student once you've finished your degree. In other words, it is important that you know very well how to handle your money while you are attending school. This will help you lessen the total amount you end up borrowing, and in turn, the amount you will responsible for repaying.

Tip #6: Maintain at least Half-Time Enrolment: Considering a half-time enrolment is highly necessary in order for you to qualify for an in-school deferment. The half-time enrolment normally takes six credit hours. Regarding your school's requirements for half-time status, see your financial aid officer.

Tip #7: Take Advantage of Tax Savings: Some of the student who takes out student loans qualifies for tax credits. To see your own status, check with your tax advisor. The credits are actually based on your qualified tuition payments, and they can help reduce the amount of Federal tax you pay.

Tip #8: Start Repayment on Time: As you enter the repayment period, note that being aware of your student loan obligations is very crucial. This is where the student loan default usually happens. It occurs when you fail to pay back the loan as agreed or meet the other terms of your promissory note.

If you need further information regarding your student loans, always remember that the financial aid staff at your school is probably your most important resource. There are also some publications from federal and state governments, lenders and scholarship granting organizations, and financial ad guidebooks that are available from your local book-store.

Monday, March 15, 2010

Consolidation Of Student Loans

Paying for college can be a real hassle especially when you graduated from your school almost a decade ago. Many graduates think that the six months they have before the required scheduled repayment of their various college debts is an eternity. The six months is nothing compared to the years of payments ahead of you. A consolidation of student loans can make the monthly much less painful.

I used to have three separate student loan bills. Two were for my undergraduate studies (which I have decided I actually couldn't afford) and one was for graduate school (which I definitely could not afford). Paying all three bills in a timely manner was a real headache for me.

Part of the problem lies in the simple fact that I have trouble remembering to complete tasks that I really don't want to complete. There must be some kind of subconscious thing going on here that I haven't come to terms with as of yet. The best solution for me was to get a consolidation of student loans.

The process of finding a lender that will accommodate your needs is no problem at all. In fact, many of these lenders come to you. A consolidation of student loans has helped me keep track of my account much easier and it afforded me a few extra dollars each month. Actually, I save about 150 bucks each month through the consolidation.

This extra money is wonderful but I also like to put a little extra on the principal each month. This is a great way to knock down the principal quicker and avoid paying too much interest. I find that the smaller monthly payments I got through the consolidation of student loans helps me make an extra payment here and there. This makes a world of difference.

The other benefit of choosing a consolidation of student loans is the interest rate itself. Even though you are refinancing the debt you will still receive an excellent rate of interest no matter what your credit is like. This is a great benefit for anyone who wants a consolidation of student loans without the fear of hiking interest rates.

I chose to take this route about two years ago and I definitely made the right decision. I have smaller payments as well as the promise of paying off the entire debt in less time than I though I would. A consolidation of student loans is a great way to gain control of this monster of a debt.

Posted by Student Loans at 9:48 AM
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