Tag Archive for: Payments

Another new year brings another set of resolutions — many of which involve making new financial goals. Whether you’re currently in school or have been in the workforce for a few years, it’s smart to make these changes now in order to set yourself up for future financial success.

But it’s one thing to make financial goals, and another thing to stick with them. Here’s a few tips to save more money and budget effectively to keep yourself on track throughout the year.

Create A Budget. Then Write It Down.

This is important. Many of us budget in our heads, but don’t take the time to write it down. Dig out your notebook — or use our budgeting worksheet. Then, follow these steps to set up an effective budget that helps you make responsible decisions with your funds.

  • Determine a timeline for your budget — will you track it by week, month, semester, or year?
  • Separate your expenses into categories like housing, transportation, and entertainment
  • Revisit the document on a regular basis to update and track payments

The way you set up your budget is up to you. The important thing is to get it written down.

Wants Versus Needs

Obviously, there are things you need to pay for. Tuition, fees, housing, and food can all add up. The line between “needs” and “wants” can be blurry, so it’s important to clearly define them in your budget.

For example, if you’re paying for a school meal plan, going out with friends is a “want,” even though you need to eat. That doesn’t mean you have to give up eating out or spending money on things you want — in fact, it’s often important to do so!

By determining which expenses are “wants” and which are “needs,” you’ll be able to spend your money responsibly without going overboard.

Financial Goals Quick Tip: Consider giving yourself a set allowance to spend on your “wants.” If you’re saving up for something big, determine which “wants” you’re willing to spend less on each week.

Credit or Debit?

When it comes to the debate between credit cards and debit cards, there’s really no right or wrong answer. In many cases, it’s smart to use both. However, it’s especially important to use your credit card responsibly.

  • Use your credit card for one small charge each month — otherwise, keep it for emergencies only
  • If an emergency does happen, stop your monthly charges and instead use that money to pay off your credit card
  • When using your debit card, keep an eye on your checking account to make sure you aren’t spending more than you have

By handling your spending this way, you can build your credit score without relying on credit card debt to fund all of your wants. Your debit card gives you the convenience and security of not having to carry cash everywhere.

Loans and Financial Aid

Chances are you’ve had to borrow some money to pay for at least a portion of your education. If you’ve taken out a variety of different loans, it can be difficult to keep track of what you really owe.

When you’re considering taking out a loan, it’s helpful to research repayment options to find the loan that is right for you. If you find your payments are too high, you may consider refinancing all your loans into one loan with a potentially lower interest rate. Refinancing means you’ll pay less each month on your student loans – if this sounds like a fit for you, U-fi can help you start the refinancing process.

Setting up your financial goals doesn’t mean sacrificing experiences like going to the movies or eating out with friends. By budgeting and defining your wants and needs, you make smart choices that count.

Want to make another smart financial decision? See how U-fi can help you refinance your loans.

As graduation season approaches, you may notice more and more ads promoting student loan refinance. You may also receive offers from companies offering to lower your rate on your student loans. What does all of this mean to you? Learn what your options are and create the student loan repayment strategy that makes sense for you.

What is Refinancing?

Refinancing means using a new loan with better interest rates and/or terms to pay off an existing loan. Refinancing is commonly used with home mortgages, but can also be a great option for your student loans. Check out When to Consider Refinancing Student Loans for additional insight into potential reasons you might consider refinancing your student loans.

Who Can Benefit from Refinancing Student Loans?

If your goal is to obtain a lower interest rate and ultimately lower the total repayment costs of your loans, then refinancing is worth exploring. This is especially true if you have older private loans that may have a high interest rate, and you feel you may qualify for a lower interest rate now. Some consumers may also want to lower their overall monthly payment. They can achieve this from either a lower interest rate, or by extending the term (i.e., length of repayment) on their loan. Finally, if you have multiple loans with different lenders or servicers, refinancing combines your loans into one. This means you’ll only have to work with one entity for your student loans in the future.

What Types of Loans Can Be Refinanced?

Most companies that offer student loan refinancing allow you to include private loans and federal student loans when refinancing. (Private loans are loans made by a bank or other financial services provider you received to help fund your education. Federal loans (i.e., Direct Loans, Stafford Loans, Perkins Loans) are made by the government.) To qualify, your loans may need to be in their grace period or in repayment to be included in a refinance loan. That means you need to be out of school when you refinance those loans. You can include multiple loans from a number of different loan holders in one refinance loan. Make sure you know all of the student loans you have, and which company or organization is responsible for servicing those loans before refinancing.

Considerations and Cautions Before Refinancing

While refinancing might sound good to you, there are some things you need to consider.

  • Don’t just look at the low teaser rates. The lowest advertised rate is usually available to borrowers with the best credit scores who select the shortest repayment term. These options may not work for your situation.
  • Understand who will actually service your new refinance loan. In many instances, the lender you initially work with may not be the organization you make payments to, or rely on for customer service.
  • If you are considering including federal loans in your refinance, ensure the benefits outweigh any loss of protections or benefits only available with federal loans. For instance, if you include federal loans in a new private refinance loan, you lose access to income-driven repayment plans and the possibility for Public Service Loan Forgiveness that might be available with your federal loans.

The bottom line is, do your research and understand what course of action is best for you. Each person has unique circumstances and concerns, so refinancing may not always be best. You can learn more about refinance loans and other related articles by visiting U-fi.com.

Interested in student loan refinancing? Take the next step toward lower monthly payments.

You’ve finished off the leftover turkey and dressing and have shifted gears into holiday shopping mode. As another year comes to a close, it’s a good time to look back on how your budget planning went this past year.

After an assessment, you can begin to find ways to improve your financial well-being in the upcoming year. In order to be prepared for a bright financial future in the New Year, it’s important to set your budget, contribute to your savings, and pay down any high interest debt.

Now is the Time for Budget Planning

Do you know how much you spent this year on utilities, groceries, housing, or entertainment? Once you have an idea of how much you’re spending on certain categories, you can estimate your projected expenses each month and use budget planning to find places to cut expenses.

There are a number of apps that can assist you with tracking and categorizing your spending, but you can also do it on your own by entering your expenses into a spreadsheet. If you use your debit card for most purchases, you can use your online bank statement to help you identify your expenses. Don’t forget to account for the cash you spend if you want a true picture of all your expenses.

When setting your budget, you’ll likely have fixed and recurring expenses for housing, transportation, student loans, utilities, and other similar areas. Then, you’ll need to set an amount for variable expenses like groceries, clothing, and entertainment.

Knowing your income each month will help you set goals. If you have a steady job, you probably have a consistent weekly or monthly income and can use that to start your budget. Your monthly expenses should be less than your available income each month.

If this is not the case, you can review your expenses to identify areas to trim back and reduce your spending each month. Once you’ve created a budget, try to stick to it as best you can each month. That way, you’ll stay on track and not get into a position of having to use credit cards or possibly getting behind on some of your bills.

Save, Save, Save—The Sooner You Start the Better

Even if you’re in your 20’s, it’s never too early to include retirement in your budget planning. If you start with small contributions, you can make it a habit and priority. If your employer offers a 401(k) plan and matches your contributions, take full advantage of the opportunity for free money.

It’s also important to set aside funds for unexpected expenses or emergencies. A good rule of thumb is to have three to six months of income in a savings account that you can access for those unplanned events. Not only will this give you peace of mind knowing that you have your own safety net, but it will help you avoid putting large charges on a credit card that will likely incur high interest fees.

Pay Down High Interest Rate Debt

Whether you’re paying off a student loan, a car, or a credit card balance, it’s always an accomplishment to know you have extra income to go toward something else (like saving).

If you can allocate some extra resources to pay down your debt, it’s generally best to start by tackling the account with the highest interest rate. That might be a credit card balance that seems like it never gets smaller because of the interest that keeps adding up each month.

Another goal you might have is to simply pay something off with a smaller balance just to get that sense of accomplishment and then move that money toward paying down other debt. It might make sense to look at debt consolidation or refinancing where you may benefit from paying off higher rate loans or debt with a lower interest rate personal loan. This is especially helpful with high rate credit cards. See our article on using personal loans to cure those post-holiday credit card blues. You can find other helpful articles and resources at U-fi.com. All of us at U-fi wish you a successful and prosperous new year!

Congratulations! You’re graduating soon and will be searching for your first job out of college. It’s an exciting time in your life. However, if you’re like the majority of college students, you’re also graduating with student loan debt. Now is a good time to make sure you’ve got a plan to manage your student loans after you graduate.

Here are some easy steps you can take to set yourself up to successfully manage your student loans.

First, Identify All of Your Student Loans

The best place to start is at the National Student Loan Data System (NSLDS). You can find information here about all of your federal loans. This will give you all the details you need to understand how much you’ve borrowed on your federal loans. You can also find out who to contact for questions about your federal student loans.

If you used private loans from a bank or other financial entity, check with your lender to make sure you have the correct loan information.

Next, Get an Idea of What Your Monthly Payments Will Look Like

At StudentLoans.gov you can access a repayment estimator for your federal loans that will give you an idea of what your monthly payment would look like under the different repayment plans available. Depending on your individual circumstances, it’s likely there is a plan that will work for you. If you have relatively low debt and a good salary, you may want to pay off your loans ASAP. The standard 10-year repayment term allows you the quickest and lowest cost method to pay off your loans.

If you have a higher debt load or lower income, there are options that base your student loan payment on your income. Income-driven repayment plans are often helpful since they give you a more affordable monthly payment based on your income. You can learn more about these options as well as how to apply them to your student loans at StudentLoans.gov.

For private loans, visit your lender’s website to access repayment calculators. Or, simply contact your private loan provider for additional information on what monthly repayment amount you can expect.

Know When Your First Payment is Due

With federal loans, you have the ability to postpone payments while you’re enrolled in school at least a half-time. This is also true of some private loans. That means you’ve probably not made any payments on your loans, or perhaps you’ve made some small payments to offset accruing interest. You are also given a grace period on your loans. The grace period is typically six months from your last day of school. The last day is usually considered when you graduate or have dropped below half-time enrollment. At the end of that grace period is when your first payment will be due. Make sure you know when that due date is. That will give you plenty of time to prepare and budget for that new payment.

Know Your Options if you Have Difficulty Making Payments and Need Assistance

There are a number of options for borrowers who encounter situations that make it difficult to manage their student loans. Your student loan servicer will work with you to find a solution, but you have to contact your servicer to get assistance. For example, if your income has changed dramatically you might want to change to an income driven repayment plan or adjust the plan you’re on based on your change in income. Additionally, if you return to school, to pursue a graduate degree for example, you can postpone (or defer) your student loans while you’re back in school. Don’t make the mistake of simply ignoring your student loan payments and damaging your credit score.

As you look forward to graduation and starting a new chapter in your life, just remember to do a little planning and research how to best manage your student loans and find the best repayment plan for your situation. And remember, your student loan servicer is there to help you if you have any questions.

At the end of each year, I review my personal finances to see how I’m progressing towards my goals. I also take stock to see if I need to make any course corrections. I refer to this annual ritual as getting my financial house in order. It has proven to be a worthwhile exercise over the years. It’s helped me navigate the inevitable peaks and valleys, and also review my financial goals annually. It especially helped when it came to handling student loan debt.

Student Loan Debt

While I am no longer handling student loan debt, there was a time when I did. While studying for my bachelor’s degree, I borrowed money to help pay for tuition, fees, and housing expenses. Fortunately, I was able to work part-time in school, and full-time during the summers. When I graduated, I had what I considered a modest level of debt.

The Realization of Repayment

After graduating, I remember receiving my student loan statement and payment slips in the mail. It had been several months since graduation. I hadn’t thought much about handling my student loan debt. Because I deferred my principal and interest payments while in school, I didn’t know exactly how much I owed. I didn’t even know when my payments were due. I can still remember looking at my loan statement and seeing how much I owed and the monthly amount due. Then, I counted the number of payment slips. I realized it was going to be quite some time before I could pay my loans off in full.

Reality set in. Having taken some finance classes while in school, I knew the high interest rates on my loans would cause interest to accrue rapidly on the remaining principal balance. The longer it took me to pay off my loans, the more it would cost. So, I sat down and developed a plan. I set up a monthly budget to manage my finances and pay off my student loans as soon as possible. This was the start of getting my financial house in order.

Discovering Repayment Options

Since that time, student loans, both federal and private, have greatly evolved. There are now many more repayment options available to students and parents to help them handle student loan debt. These include various income-driven repayment plans, federal loan consolidation, and private student loan refinancing. Each of these options has distinctive features and eligibility requirements, so it makes sense to compare them to one another to see if any meet your needs. You can learn more about federal student loan repayment plan options by visiting the Department of Education’s Federal Student Aid website. To learn more about student loan refinancing and loan consolidation, and which one may be right for you, click here.

Making a Repayment Plan

Creating a solid financial plan and sticking to it is an important part of any person’s financial well-being. If you haven’t already done so, I highly encourage you to review your financial situation, create a plan, and set a monthly budget. If you need help getting started, U-fi offers several tools including budgeting strategies, worksheets, and financial wellness tips.

Once you’ve created your plan, be sure to review it at least once per year, as your goals and/or financial situation may change. This way you can make any needed adjustments to ensure you stay on track. By keeping your financial house in order you can increase the likelihood of achieving financial success.

Does your January credit card statement have you feeling blue? Find out how personal loans could provide credit relief.

It Happens to the Best of Us

The holidays have come and gone. You may be feeling a bit relieved that all the seasonal hustle and bustle is over. Sure, it may be a bit cold outside. Sure, work is back in full swing. But, things are looking good with your New Year’s resolutions. You’re feeling optimistic and energized.

Then, you receive your January credit card bill. Whoa, the new balance is much higher than you expected. As you go down the list of purchases on your statement you ask yourself, “Did I really spend that much?” You also notice the available credit on your credit card is pretty low. There are some big purchases coming up in your future. You were planning on using your credit card to pay for them. Now, you no longer have enough available credit to pay for everything as planned.

With average credit card APRs over 16%, and many exceeding 20%, you know if you don’t pay your balance in full you’ll be hit with a hefty finance charge, which will be added to your outstanding credit card balance. And even worse, if you’re late making the minimum payment that’s due, you could be hit with a penalty APR, which can be as high as 29.99%.

Personal Loans Could Provide Credit Relief

This is where personal loans could provide credit relief. Unlike a credit card, which is a revolving line of credit, a personal loan is an unsecured loan that doesn’t require any collateral, such as a car or house. Personal loans come with a specific repayment period, usually between 1 and 7 years. Fixed interest rates are more common than variable interest rates, and some lenders will offer you a choice.

The main reason people take out personal loans is to pay off existing debt, such as high interest rate credit cards or loans. Other common reasons include making major purchases, for home improvement projects, for special occasions like weddings, to take a vacation, and to pay off medical bills.

Personal loans can range from as little as $1,000 to as high as $100,000. APRs vary widely among lenders and are based on the borrower’s (or co-signer’s) credit history, annual income, repayment term selected, and type of interest rate chosen. Some personal loans even come with money saving automatic payment discounts and loyalty discounts.

Tip: Some lenders charge upfront fees, which add to the total cost of the loan, so be sure to take that into account before choosing a lender.

A really nice feature for personal loans is how quick and easy the process can be. If you submit a completed loan application, you can receive a decision in a matter of minutes, and if approved, receive funds in your bank account as soon as the next business day, provided your application has no typos or errors.

Now that the holidays are over, you may be suffering from the post-holiday credit card blues. If so, check out a personal loan for credit relief from U-fi’s partner. It just may be what the doctor ordered.

The holidays are over and the new year brings a new semester. For many students, that means a new round of bills and education expenses. That means it’s a perfect time to evaluate your finances and make sure your budget is in the right place.

If you attended college in the fall, you may have relied on financial aid to help cover your education expenses. With a new semester about to begin, you may want to reconsider your options. Many students still owe a balance from fall semester. Meanwhile, others just realized they may need additional funding to help pay for the upcoming semester. Use this time to take stock of your financial resources and make a plan to ensure everything is covered.

Do you still owe a balance on outstanding charges from your fall semester?

You may be required to fully satisfy outstanding charges before you can complete your enrollment for the next semester. Make sure you take care of the previous balance as soon as possible. That way, you avoid any potential delays with your upcoming enrollment. If you didn’t have enough financial aid or personal resources to pay your prior semester’s bills in full, consider a private loan to help cover what you still owe. You can find private loan solutions at U-fi.com.

Did you apply for financial aid either before or during the previous semester?

It’s always a good idea to apply for financial aid by completing the Free Application for Federal Student Aid, or FAFSA, even if you don’t think you’ll qualify. Not everyone qualifies for grants or other “free” money. But, you may qualify for federal student loans, like unsubsidized loans, which are not based on financial need. You can still complete the FAFSA, even after the school year has started. It’s free and doesn’t take much time, so it’s worthwhile to submit. That way, you’ll know you’re not missing out on any financial aid programs.

What are your education expenses going to be in the upcoming semester?

By January, you should have an idea of your direct college expenses are for the upcoming semester. These education expenses including tuition, books, housing, and other costs. Do you have financial aid that pays for everything, or do you still have a gap where additional money is needed? Make sure you look at your full semester and anticipate all of your expenses. Set a budget so you’ll know exactly what your expenses are. Make sure to keep track of what types of income or financial resources can cover those expenses. Use all the financial aid resources available to you, including federal loans, to help pay your costs of attending college. If you still find yourself in need of additional money, you can explore the possibility of a private education loan at U-fi.com and find a solution to help cover your college expenses.

When should you apply for next school year’s financial aid?

In case you missed it, you can now complete the FAFSA starting on October 1 for the following school year. You may only be halfway through the 2018-2019 school year, but it’s already time to submit your FAFSA for the 2019-2020 year. If you haven’t completed the FAFSA for next year, it’s important to get that taken care of as soon as possible. With the earlier submission date for the FAFSA, it’s critical to get your application in as quickly as possible so you don’t miss any priority deadlines for state grant aid or other types of aid that may not be available if you apply too late.

For more tips and resources on planning and paying for college, visit U-fi.com. Remember, now is the time to make sure you have everything in order for the current semester and for the next school year.

If you have student loan debt, you have most likely heard the terms “student loan consolidation” and “student loan refinancing”. Although they sound similar and are often used interchangeably, they are actually two different programs. Therefore, understanding these programs and their key differences can help you make better student loan repayment decisions.

Student Loan Consolidation

Student loan consolidation lets you combine one or more eligible federal student loans into one new Direct Consolidation Loan. As a result, the U.S. Department of Education becomes the new lender. As the administrator of the program, they use companies such as Nelnet to originate and service the loans.

Student Loan Refinancing

Student loan refinancing is offered by private (non-federal) lenders to allow student loan borrowers to refinance one or more federal and/or private student loans into a new private student loan. Consequently, the lender of the new private student loan will be a bank, credit union, or other financial institution. Either the lender themselves or entities like Firstmark Services, a division of Nelnet, handles origination and servicing.

Which is Better?

Both programs offer many benefits. These benefits include simplifying your monthly student loan payments, locking in a fixed interest rate, and lowering your monthly payments. However, there may be some drawbacks as well. For example, if you extend your repayment term, you could increase the total cost of your loans. Therefore, you may forfeit current and potential future federal student loan benefits. Also, any incentives attached to your current loans, such as interest rate reductions for automatic payments, are lost.

Comparing Options

The table below provides a side-by-side comparison of several important features of student loan consolidation and student loan refinancing.

Student Loan ConsolidationStudent Loan Refinancing*
LenderU.S. Department of EducationBanks, Credit Unions, and Financial Institutions
Credit Check RequiredNoYes
Upfront FeesNoneMost lenders do not charge any upfront fees
Interest Rate TypeFixedFixed and variable rate options are offered by most lenders
Interest RateWeighted average interest rate of the loans being consolidated, rounded up to nearest one-eighth of 1%Varies. Factors may include the borrower’s and/or cosigner’s credit history; repayment term; interest rate type; highest level of education; and current market conditions
Repayment PlansStandard, Graduated, Extended, and various Income-Driven Repayment plansStandard Repayment
Repayment Term10 to 30 years depending on the amount being consolidated5 to 20 years
Allowable LoansMost federal student loans are eligible. Private loans are not eligibleFederal and private student loans are allowed by most lenders
Interest Rate ReductionRate reduction for automatic paymentsRate reduction for automatic payments. Some lenders offer an additional rate reduction to existing customers with a qualifying account
Ability to consolidate or refinance multiple timesGenerally no, unless additional federal loans are includedYes
Loss of Federal BenefitsSome benefits may be lostYes, including potentially qualifying for Public Service Loan Forgiveness on federal loans
When can you consolidate or refinanceAfter graduation, leaving school, or dropping below half-time enrollmentAfter graduation, leaving school, or dropping below half-time enrollment. Some lenders allow refinancing while in school

* Features represent those of the largest and/or most common private student loan refinancing programs. A specific lender’s features may differ, so be sure to read the program details carefully.

Choose the Right Option for You

While there are similarities between student loan consolidation and student loan refinancing, they are different programs with unique features. Firstly, if you are interested in consolidating or refinancing your current student loans,determine what you want to accomplish. Your goal may be to lower your monthly payments, lock in a low fixed interest rate, and/or lower your overall cost of repaying your loans. Next, compare the federal government’s Direct Consolidation Loan program to U-fi and other private lender programs once your goal has been set. Then, decide if consolidation or refinancing is right for you based on your financial goals and circumstances.

Want to reduce your monthly payments? Learn how to make it happen with U-fi.

If you borrowed student loans to help pay for college, you may not be required to make any payments until after you graduate or drop below half-time enrollment. That sounds like a pretty good deal; no payments and no worries while you focus on your studies. But remember, if you take out a federal Direct Unsubsidized Loan, a federal Direct PLUS Loan, or a private loan, interest accumulates during those months (or years) you’re in school and not making any payments. Here are some ways you can save on your student loans while you’re still in school.

Accruing Interest

Interest that accrues on your student loan will typically be capitalized when you begin repayment. That means any accrued interest during those months you are not making payments is added to the original principal amount of your loan. For instance, if you borrowed a $15,000 student loan with an interest rate of 6% as a freshman and made no payments for the four years you were in school, plus your grace period, 51 months would have passed. In this scenario, when you begin your repayment period, you would actually have a balance of $18,825 when you start repaying your loan 51 months later. That’s because $3,825 in interest (also known as capitalized interest) would have accrued during those 51 months and was added to your original loan amount.

In-School Payments Can Help

Now, let’s say you have a part-time job while you’re in school, working 15-20 hours a week to help with some of your expenses. If you could simply pay around $75 a month toward that $15,000 student loan, you could actually pay all the accruing interest (remember, that’s $3,825 total that would have been added to your loan when your first scheduled monthly payment is due). If you’re able to pay $75 towards your student loan’s accruing interest, the total cost you could ultimately save over the life of a 10-year repayment period would be nearly $1,300.

Example

Paying Interest While In School (No Capitalized Interest)Fully Deferred Payments While In School – No Payments (Capitalized Interest)
Original Loan Amount$15,000$15,000
Interest Accrued During In School and Grace Period (51 months)$3,825$3,825
Interest Paid During In-School and Grace Period$3,825$0
Loan Amount When Entering Repayment$15,000$18,825
Number of Months of Repayment120120
Monthly Payment$166.53$209
Total Interest Paid on Loan (including any payments during in school and grace period)$8,808.60$10,080
Total Paid on Student Loan (original loan amount plus interest)$23,808.60$25,080

As you can see from this example, making interest payments while you’re in school and during your grace period can help you save on your student loans down the road. Plus, making payments during your in-school and grace period also gets you in the habit of making payments on your student loan and better prepares you for successful repayment. Remember, this is just an example of borrowing one loan during your freshman year of college. Imagine what the capitalized interest could look like if you borrow each year of college, or what your savings would be by making continued interest payments while you’re in school. You can learn more ways to save on your student loans and get additional helpful information by visiting our student loan resources.

If you graduated from college this year, you may realize just how much student loan debt you have. With the average student loan debt at around $29,000 per student, it can be overwhelming to see that number and you may wonder how you are going to pay it back. Well, take a deep breath: you have several options when it comes to repayment. Don’t hesitate to give your student loan servicer a call because they will help you work through your options. Or, you can also follow these 4 steps to get ready for student loan repayment. It’s important to investigate your options and be prepared. It’s equally important to know a few things you should avoid.

Deferment & Forbearance

Deferment and forbearance allow you to temporarily postpone making payments or can reduce your payment for a period of time. Sounds great, right? So, what’s the problem? Your student loans continue to accrue interest. That interest could cost you thousands of dollars a year, depending on your student loan debt. Don’t delay the inevitable. You will have to pay back your student loans whether you pay them now or pay them later. Deferment and forbearance are great options if you have no financial means when you enter repayment. However, you shouldn’t use them as a way to delay paying your student loans. If you do need to go this route, try to at least make interest payments on your loans. If you don’t, the interest will capitalize leading to higher student loan debt and higher monthly payments once your deferment or forbearance expires.

Don’t Miss Payments

Make your payments every month and on time. If a loan payment is not made by the due date, the loan becomes delinquent until payment is received. Depending on your servicer or lender, this delinquency can affect your credit report as a negative mark, therefore negatively affecting your credit score. In addition, when you miss monthly payments, your payment will double, then triple, and continue to snowball which may put you in a situation that’s difficult to catch up on.

Avoid Scams

We’ve all heard the saying, “if it sounds too good to be true, it probably is.” It may seem enticing to pay a company to handle the stress of your student loans and promise you low payments or loan forgiveness, which are why these companies exist, but you’ll be wasting your money. Student loan servicers and lenders will not charge fees for finding a repayment plan that fits your needs. The U.S. Department of Education offers several student loan repayment plans and loan forgiveness, cancellation, or discharge for certain circumstances, but all of their services are free of charge.

Being prepared for repayment and understanding what you should avoid are two big steps to successfully paying off your student loans. Just remember, your student loan servicer is there to help you. If you need to adjust your repayment plan or just have questions about your student loans, give them a call (844.307.3451).