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Options for Student Loan Repayment |
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Student loan debt consolidation is growing in popularity with recent college and university graduates. Few undergrads can afford to finance their higher education without financial aid of some kind. |
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| Author: Brian Williams |
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Student loan debt consolidation is growing in popularity with recent college and university graduates. Student loans have become as much a staple in college life as a toga party: they are to be expected. Few undergrads can afford to finance their higher education without financial aid of some kind. Unlike a toga party, however, student loans last for years and must be repaid, and for many students this means student loan debt consolidation.
What are student loans?
A student loan is money borrowed to pay for post-secondary education. A recent study shows that 63 percent (ref 1) of recent college graduates took out student loans to pay for school.
Student Loan Options
There are two types of student loans: federal and private. Federal loans are backed in full faith by the U.S. Government and therefore offer lower interest rates that do not accumulate until after graduation of the borrower. Private loans are obtained students or parents through private vendors such as banks or credit unions. Interest on a private loan accrues automatically from the time the loan is obtained.
Repaying Student Loan
Timely repayment is key go getting rid of debt accumulated by student loans. However, like any loan, high interest rates and late payments lead to an unstable financial future. At this point, many consider student loan debt consolidation.
Multiple federal student loans can be consolidated into one loan with one interest rate. The average (rounded to the nearest eighth of a percent) of interest rates is applied to the new consolidated loan. There are no fees or charges, but the borrower must have reached his or her grace period (six months after graduation, or moving to half-time status with your school) before consolidating. Student loans may not be consolidated before you begin repaying or have entered your grace period.
The standard repayment term on federal loans is 10 years. Consolidating your loans may lower your monthly payments; however, you attain a larger principle and consequently extend your repayment time by much longer than the standard 10 years.
Key points to remember:
*Thoroughly research your student loan options, both federal and private
*Ensure that consolidating your student loans after your grace period will benefit you in the long run
Call today for a free debt consultation. Credit Solutions will explain how easy and efficient your student loan solution can be.
About Author
Allison Roberts is a graduate of the University Of North Texas Department Of Journalism. She has writing experience in both agency and freelance public relations and is currently writing for Credit Solutions. Allison's other articles on Debt Free Life, Debt Consolidation Tips and Debtors Beware can be found on http://www.creditsolutions.com
Article Source:
http://www.1888articles.com
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