10 months ago
The six-month grace period that was given to the 2018 graduates is almost done and just in a couple of months, former students will have to repay their loans. Even though repaying your student loan may seem to be a pretty simple thing, many students still make a lot of mistakes that can be easily avoided. The Typical Student team collected 5 mistakes students make while repaying their loans and, of course, how to avoid them.
#1 Payment Confusion
During the years at college and the grace period after the graduation most of the students tend to forget how much and who they owe. Especially if they took a combination of private and federal student loans.
Make a list of all you’re your loans as well as loan services and keep in mind the fact that the company that gave you the loan might not be the company that is servicing it. You can also write down all the basic information about the servicer’s name, phone number, address, website as well as when the payments are due and the amount of money you will have to pay.
#2 Forgetting to Update Your Education Status and Contact Info
While applying for a student loan many students give their parents’ addresses or their school emails in the contact info section. However, almost every student move out from the parents’ house after the graduation (if not earlier) and do not use their school emails anymore. So if you don’t update your contact info, you risk missing important notifications from your loan service.
Update your contact information such as address, phone number, or email, if you had changed them, and inform your loan service if you returned to school in order to avoid future repayments problems.
#3 Refusing to Ask for Help
Most of the students who are struggling financially usually do not ask for help, because they think that nothing can be done to help them. However, loan services have special policies for those who do not have enough money to repay their loan right away.
If you are struggling financially, contact your loan service and ask for a temporary interest-rate reduction. It is a usual thing and most of the loan services provide it.
#4 Taking for Granted the Opportunities to Reduce Your Student Loan
Most of the students and their parents do not use the opportunity to reduce the loan by paying it back sooner. However, the sooner you repay – the less you repay.
Try to repay your loan as soon as it is possible and you’ll pay less.
#5 Believing in Student-Loan Repayment Scams
Unfortunately, many students become the victims of the student-loan repayment relief companies. However, such companies do not help students to repay their loans, but vice versa make the things even worse. So those who believed such companies sometimes end up repaying even more money than they actually owed.
Do not believe the companies that charge an upfront fee to purportedly lower your debt or forgive it shortly. In addition, beware of the companies that email or call you all of a sudden and claim to be a loan service or associated with the government. Such companies are 100% scam.
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