Do you have a student debt worth 100,000 USD on your shoulders? Are you compromising on your everyday life just to make the monthly payments? Is your credit score very low? Do you want simple strategies that would help you with the student loan debt? If yes, this article will definitely lend you a helping hand. Student loan is a very stressful debt that can slow down your life and leave you hopeless! Unfortunately, most students are not able to shun away from hefty student loans. Even well educated citizens of our country are victims of the student loans system.
Common strategies that can help you with student loans are deferment, forbearance, consolidation, forgiveness and student loan bankruptcy.
Help #1 – Opt for Loan deferment
Do you know that you can defer your student loans for few months? Some students tend to defer their loans for several years! By doing this, you can skip several monthly payments and save some cash periodically. However, you must get prior permission from the lender. Deferment will not affect your credit score. Money saved through deferment can be used to take care of other debts. Thus, you will be financially strong when you are ought to reimburse the student loan. Deferment has a very simple drawback. If the government fails to reimburse the monthly interest, you will be forced to do it.
Help #2 – Opt for Loan Forbearance
Forbearance is quite similar to loan deferment. However, there is a very small difference. You can opt for loan forbearance, only when your deferment application gets rejected. Interests acquired during the break will not be reimbursed by the government. Instead, you should pay everything that gets accumulated during the break. The only plus in this strategy would be the small break you receive from your loan payments. Meanwhile, you will end up paying a bigger sum in the longer run. This is why you must think twice before opting for loan forbearance.
Help #3 – Opt for Loan Consolidation
Thirdly, you can make use of loan consolidation. As suggested by its name, consolidation will convert multiple loan payments into a single one. You can opt for consolidation if you have borrowed several federal loans. Consolidation will give you a better insight through your debt. It will help you monitor and control cash flow. On the contrary, you must be very careful when you decide on loan consolidation. Sometimes, you may pay a bigger interest over a longer period of time.
Help #4 – Opt for Loan Forgiveness
Federal student loan forgiveness is another way of clearing the debt. Through forgiveness you can cancel a small part or the complete loan. The forgiveness application must be downloaded from the Federal Student Aid website. The benefits of this program are pretty obvious. Meanwhile, the benefits of loan forgiveness cannot be enjoyed in the longer run. You must reimburse your loan after sometime or the other!
Help #5 – Opt for Student Loan Bankruptcy
Finally, you can opt for student loan bankruptcy. This is a strategy used by students who are financially weak. The option will discharge your loan and help you survive the debt.