Many people think they cannot afford a college education. School costs a lot of money, but student loans make the dream of a higher education a possibility. Read the following article to find out how to go about applying for one.
If you have any student loans, it’s important to pay attention to what the pay back grace period is. This is the amount of time you have before the lender will ask that your payments need to start. You can use this time to start saving up for some initial payments, getting you ready to avoid any penalties.
Always know all the information pertinent to your loans. Keep track of this so you know what you have left to pay. These facts will determine your loan repayment and forgiveness options. This information is essential to creating a workable budget.
Stay in contact with your lender. Update your address, phone number or email address if they change which sometimes happens quite frequently during your college days. 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 necessary actions as soon as you can. Failing to miss any deadlines or regulations can mean risking losing quite a bit of money or time.
Never do anything irrational when it becomes difficult to pay back the loan. Unemployment or health emergencies will inevitably happen. There are options like forbearance and deferments for most loans. Remember that interest accrues with many loans, so it’s important to at least make the interest portion of your loan payments.
Grace Period
How long is your grace period between graduation and having to start paying back your loan? Stafford loans have a grace period of six months. Perkins loans offer a nine month grace period. The amount you are allowed will vary between lenders. Know what you have to pay when, and pay on time!
Be sure you select the right payment plan option for you. Many student loans come with a 10-year plan for repayment. If these do not work for you, explore your other options. For instance, you may pay back within a longer period of time, but it will be with higher interest rates. You may have to pay a certain part of your income after you get some work. Some student loans offer loan forgiveness after a period of 25 years has elapsed.
Your student loan application must be filled out correctly in order to be processed as soon as possible. If you make a mistake, it will take longer to go through. You may not see any money for an entire semester.
Perkins Loan
Two of the most popular school loans are the Perkins loan and the often mentioned Stafford loan. They tend to be affordable and entail the least risk. The are idea, because the government shoulders the interest payments while you remain in school. Interest rates for a Perkins loan will be around 5%. On subsidized Stafford loans it is fixed at a rate no greater than 6.8%.
Be aware that you may need a co-signer for a private loan if your credit isn’t good. You must then make sure to make every single payment. When someone co-signs, they are responsible too.
Keep your eyes open when dealing with a private student loan. Finding out the specific terms can be challenging. Often, you don’t know until you have already signed on the dotted line. Then, it will be very hard to free yourself from them. Make sure you get the information you really need. If a lender gives you a good offer, see if another lender will match it or do even do better.
Double check all applications for errors. A mistake may result in you getting less money than you had hoped for. Ask for help from an adviser if you need it.
You can save money by purchasing a meal plan from the college cafeteria. The best way to do this is to pay for meals rather than a specific dollar amount. A plan that presumes you will eat every time food is served may overcharge you.
Higher education is expensive and may require incurring some debt to complete. Getting an education financed isn’t too hard if you use the tips like the ones you were given here. Apply this guidance any time you seek student aid.
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