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Easy Ways to Manage Your Student Loans
Student loan borrowers often regret taking out so many loans while in school. Many borrowers feel trapped and have nowhere to run or hide. There are graduates who qualify to enroll in federal student loan forgiveness programs.
The programs that are available can either reduce or cancel your existing student loan balance. Based on your profession or repayment plan of choice, you have options to choose from.
Being in default on your loans, automatically disqualifies you. It takes nine months of going without making a single payment, to be considered in default. Since private student loans don’t provide borrowers with forgiveness options, it’s up to the lender to decide how they will accommodate your needs. You will need to call your lender to see what your options are.
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If you work for a nonprofit or government agency for more than ten years, then your remaining federal loan balance is eligible for forgiveness. Teachers, military workers, nurses and other public service professions, typically qualify for this program. If you qualify for Public Service Loan Forgiveness, consider enrolling in an income-driven plan to save a lot of money.
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Only federal direct loan borrowers, who meet the above criteria are eligible for Public Service Loan Forgiveness. If you have additional student loans, in addition to federal direct loans, try consolidating them to see if you’re eligible.
Reach out to the company that handles your federal loans, for help with your application. This is the first step you’ll need to take to confirm if you are eligible. They will let you know if you need to consolidate, as well as the required paperwork to complete.
In order to remain on track, you will need to work with your employer to complete the necessary paperwork. The form isn’t required annually, but it’s recommended that you send it in each to stay on track. Consider certifying your employment retroactively, as it will cut down on the extra paperwork.
Federal Perkins loan borrowers, are eligible to have their loans completely canceled after five years of public service work. If you’re not sure about your eligibility, there are detailed charts where you can check if your job qualifies.
There are additional guidelines to be aware of if you are a teacher. You don’t qualify just because you work full-time at a public school, the subject and type of school are also factored into your eligibility.
Income-driven repayment plans allow you to pay a small portion of your monthly income toward your student loan debt. Your remaining balance is typically forgiven after 20 years, although some plans are up to 25 years. Always check with your lender to find out which option will best apply to you. As long as you come up with a solid strategy to pay off your student loans, you will be able to manage your debt without fear or anxiety.