4 Ways To Pay Back Your Student Loan

September 19, 2011 – 2:13 pm

Paying back your student loan is very important. A lot of people do not realise that these loans do appear on your credit reports and not keeping up with payments will affect your credit score. This will have a lasting effect on your ability to borrow money in the future. This means you will not be able to get a credit card or a loan for a new car. Below are four ways to help pay back your student loan.

Get In Touch With Your Lender

1. If you have reached the date of which you need to start paying back and you are not in a financial position to start making payments you must get in contact with your lender. Explain what is happening and your current situation and see if they can help you. It is possible to be granted a longer period of grace before your payments have to begin, so hopefully this should not have an adverse effect on your credit rating by missing payments. Some lenders can be flexible, for example a smaller monthly payment could be arranged which can be a real help in some situations.

Ask For Longer Loan Terms

2. Some lenders can be flexible, for example a smaller monthly payment could be arranged which can be a real help in some situations. If you owe a substantial amount the loan period could be extended from ten to twenty years. The only disadvantage is that you will end up paying a lot more interest over a longer time period but your monthly instalments will be considerably smaller.

Cut Back On Your Monthly Student Payments

3. What you pay back monthly really depends on how much income you are receiving. If your income is tight there is a special plan called ‘income-based re-payment’. This will reflect your re-payments based on your income. If you have used a government based loan, using the income-based repayment plan can make your monthly amount affordable for you. This can work out well if your plan is over 25 years and you make all your payments on time because in most cases any remaining balance left can be written off. If you have a private loan, this system will not be available to you, but the lender can be flexible to make your payments easier. As long as the loan company is receiving some payment each month then that can be enough to satisfy their requirements.

Have Your Student Loan Cleared Instantly

4. Sometimes depending with what qualifications you leave university with you can have your loan cleared, meaning you do not have to pay it back! Yes, for example if you end up working in a public service industry like teaching or health care your loan debt could be reduced or even cleared.

Find more information and detailed student loan advice go to Student Loans or visit Financial Loans for general financial advice covering a huge range of subjects.



Sorry, comments for this entry are closed at this time.