Student Loan Help – 4 Options
4 Options to Consider if You Need Student Loan Help
If you’re struggling to make the payments on your student loans, and you need student loan help, you’re not alone. When the 2017 college class graduated, the average amount of student loans each one carried was in excess of $39,000. College costs are increasing every year forcing students to borrow more. This only adds more to the total outstanding student loan debt which is just under $1.5 trillion dollars.
When you factor in that about 11% of these loans are in a delinquent status, taxpayers will be on the hook for a lot of money.
There are a few options available to you that can help get you back in control of your debt. Consider one or more of the following that can help to make your life a little easier.
Consider changing to an income-based repayment plan.
If your college education was funded with federal loans, there is student loan help available that can lower your monthly payment to an amount based on a percentage of your current income. With a federal loan, you are able to modify your original loan agreement and reduce your payment. This program can help a lot and keep your loans current.
Consider refinancing your loans
This option is available to you if you have federal loans or private loans. Be careful though, when refinancing your federal loans, to not forfeit student loan forgiveness down the road. Speak with a counselor and get all the facts and recommendations. Usually, on a federal loan refinance, you should be able to get a better interest rate as well.
- If you’re refinancing private loans you more than likely have a co-signer or a guarantor, so be sure to discuss this with them first. If all credit scores are good, you might be able to get a reduction in the interest rate as well. If anyone suggests refinancing a federal loan into a private loan, be extremely careful and get professional advice.
Consider a second job
I know..I know. You’ve started your new job and you put in a lot of hours, and you’re too tired to think about a second job. I speak from experience so I know where you’re coming from. It’s not easy, but if you’re committed to repaying your student loans, this will get rid of them faster than any other way. There are many things that you can do to earn the extra income. Finding one that you like is very important. Don’t use that extra money for anything but paying down your student loans, and the day that you are debt free won’t be very far away.
Consider moving back home
This is one option that I hesitate to suggest for many reasons. Sometimes parents balk at this, but if you can show them that you’re doing all that you can to repay these loans, they may be willing to help. Plus, if you can help them by doing things around the house, it will go a long way. This is only meant to be a very temporary solution, so don’t plan for the long term.
Consider one of the above options, or all four if you want to get rid of your student loans as quickly as possible. Being able to reduce the rate of interest on your loans will mean that you will be paying less interest over the term of your loans. Plus, paying extra principal each month will reduce the interest paid even more.
Student loans are a necessary evil and often times, they are the difference between getting a college education or not. You don’t always have to attend one of the Ivy League schools, so be prudent in your selection. Before you go into default, get student loan help as soon as possible.
Gust Lenglet is the CEO of HBS Financial Group, Ltd., an accounting & tax preparation firm in Maryland. He has more than 25 years of experience in the banking and financial industry. Gust started his career as a loan officer at a major national bank, and then moved on to become controller of a multi-state law firm. In recent years, he has written many financial articles that have been published on Ezine Articles and many websites.