“Neither a borrower nor a lender be” quoted, Shakespeare. However, with a handy loan guide, you can clear your loans on time and avoid paying extra processing fees. Further, if you have just started college, you must visit www.moneysavingexpert.com/students/repay-post-2012-student-loan so you can track your payments and avoid paying extra processing fees.
Before you fret about this, take a look at these tips to get the incomplete details on a student loan.
1. Know Thy Lender
As a borrower, you must have complete details about the lender. This includes information about the outstanding balance, status of the loan, and any other details you think is important. There are several websites that will help you keep track of all the federal loans. Do not worry if you find your loan missing from the list. It could be a private loan. If you are unable to find relevant records, get in touch with your educational institution immediately.
2. What’s Your Grace Period?
As a borrower, you should be aware that federal loans and private loans have a different grace period. For beginners, a grace period is the time period that permits payments to be received after the due date. Usually, a grace period of 15 days is allowed, and during this period, there are no extra fees for late payment.
This is why it is important that you do not miss your first loan payment. As a student, get in touch with your lender to know more about the formalities.
3. Connect With Your Lender
In case you have relocated, or you have changed your telephone number, inform your lender immediately. In case of incorrect details, you have to bear the brunt. Go through each letter or email that you receive from the lender.
If you receive calls from the agency, inform your lender about the same. Ignoring the bills can land you in some serious trouble in the long-term.
4. Choose Your Repayment Option:
For federal loans, the repayment period stands at 10 years. If you find it difficult to repay the loan, you must look at other options available. For instance, you can extend the repayment period beyond the standard 10-year plan. This will lead to smaller monthly installments, but you have to face a high rate of interest.
In case you fail to pay off the loan after 20 or 25 years (based on the plan chosen), the remaining debt will be forgiven.
5. Stay Calm
If you have personal issues like unemployment or a medical emergency, do not panic. You can avail options like deferments and forbearance. These permit you to temporarily stop paying loan payments until your financial situation improves.
A word of caution though. During deferments, interest gets accumulated which can increase your risk of debt. Find out if you are eligible for interest-only payments. These are some tips and tricks to take a student loan and make proper repayments, so that you don’t suffer in the further. Maintaining a proper credit score and a frugal practice helps you grow and manage finance well.