How Refinancing Student Loans Can Save You a Lot of Money
There’s a very good reason why student loan debt is discussed frequently today. At the present time, there is in excess of $1.35 trillion dollars of student loan debt owed by borrowers in the USA. Is it any wonder that refinancing student loans is so popular?
This tremendous amount of debt is taking its toll on so many individuals. On the Federal student loans alone, a little more than 13% are in default before they even reach two years of repayment. That is a very serious default rate.
5 Steps to Consider Before Refinancing a Student Loan
In other articles, I have discussed the cost and debt implications of having a student loan. With the rising cost of college tuition, many young adults are getting in over their head and looking for answers once they graduate. Refinancing a student loan can give you lower monthly payments and allow you to build more savings or pay current debts off.
It‘s important to first ask yourself the ever important question of why you want to refinance your student loan. If you have a fixed rate Un-subsidized Stafford Loan, which is the most common type of federal loan for students, you need to be aware that interest rates for these loans have not changed.
Many refinancing options will switch you from a fixed rate loan to a variable rate loan. This means that the monthly payments on your loan may be smaller when you first refinance but could increase significantly over time. A variable rate loan could end up putting you in a worse position down the road. View full post…
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