Although graduating is a big milestone that you’ve achieved and you should be proud of yourself. But you must also take care of other big things such as your student loan. After you’ve received your diploma, you need to start finding a job because you have to repay your loans. Loan repayment is one of the least appealing parts of growing up.
Opposing to the popular belief, you don’t have to give up everything and maintain a very tight budget to make your student loan payments. You need to weigh your options and identify strategies that work effectively while staying within your budget.
If you haven’t started your loan repayment process, we need you to pause it for a while and go through this blog to identify things that you can do before you make your first student loan payment.
Student Loan Payments COVID
We know that you’re also tired of hearing the word “Cheap Essay” because it has disrupted our lives and we’re forced to stay at home to avoid the spread of this novel and deadly virus. It has already affected thousands of people in the US and schools, businesses, and colleges all have come to a halt due to this virus.
Since people have been suffering financially, so repaying loans can be challenging for some people. The government has extended the relief benefits for borrowers with federal student loans. In this way, you don’t have to worry about repaying your student loan.
Student Loan Payments Suspended 2021
As mentioned earlier, the process of student loan payments have been suspended due to coronavirus. As a response to this, the US Department of Education has suspended all the interest and payment plans on federal student loans for almost 60 days. The President has signed the relief bill.
However, students’ loan suspension has been extended and 0% interest rates were charged till December 31. This action was taken in light of the rising unemployment rate and public health crisis, as the US is among the worst-hit countries due to the virus.
Federal Student Loan Payment
The federal government provides financial aids to students, so you can complete your studies. Although this sounds over whelming for those students who can’t meet their expenses. After you’ve graduated, left school, or even dropped below half-time enrolment, your federal student loan goes into repayment.
5 Things to Consider Before Repaying Student Loans
We have compiled a list of 5 pointers that you should do before you make your first student loan payment, and these are mentioned below.
- Compare the Monthly Payment Amounts
If you think that you can’t afford to pay the amount or want to lower your monthly payment, then you can consider changing your payment plan and move towards an income-driven repayment plan. You can make payments depending on your monthly income. However, you’ll need to repay the loans for a longer period.
- Make a Decision to Consolidate or Not to Consolidate Federal Student Loans
If you’ve borrowed federal student loans before 2011, you can consider consolidating your loan. You can even combine these loans into a single new loan. In addition to this, you can also consolidate if you’ve taken several loans and want a single monthly payment. You can stretch the timeframe in which you can repay your loans. Nonetheless, by increasing the time of loan repayment, you need to pay more interest.
- Select an Affordable Repayment Plan
After you’ve chosen to consolidate, you’ll need to choose a repayment plan. On the other hand, if you’ve chosen not to consolidate, then you should enroll in one of the income-driven repayment plans. Although not all repayment plans are the same. But, graduated repayment plans enable you to pay less at first, and then over time, your payment will increase.
- Set Up Your Payments
After selecting your repayment method, you can create a budget and organize your spending. You can even start by early payments, as it can save money that is being paid in the form of interest in the long run. We believe that making additional payments is a financially savvy move.
- Identify a Person Who You’ll Contact If You Require Help with Your Loan Issues
You need to be alert of the student scams. To ensure that you’ve selected the right method and the right sources for your student loan payment, you can ask for help from someone who has an understanding of student loan payments.
We know that repaying loans can be tough for you but by choosing the right options and the right payment methods that work best for you, loan repayments can be easier. You need to focus on the aforementioned 5 main tips before making your first payment, and your loan repayment procedure will be hassle-free.