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Have your Goals and Dreams gotten lost in your daily struggle to earn a Living and Provide for
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A Few Years ago, I wasveryafraid of thecomputer in my home. My son bought me the computer, and set it up in the family room. It stood on my table, all pretty looking. I dusted around it, touched it gingerly, even sat in front of it and admired this beautiful machine. Since I could not switch it on, I simply felt very modern, because I have a computer. But, it was something alien that my grand
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The
HipBot Grabs Live Dynamic Content 24/7, 365 days
a year to optimise and build your Home Income Portal
Income withLive Title,
{$first_snippet_title},
Student Loan Rates To Rise July 1 2007Live
Categories,{$first_snippet_category}
Loans
and
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{$first_snippet_keyword} ,
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As of July 1st, 2007, the interest rates on student loans are scheduled to increase. Although less than one percent, the resulting repayment amount can rise significantly over the life of the loan. So, college graduates can definitely use information on how to make student loan repayment less painful financially.
First, and most importantly, consolidate. Interest rates are locked in, once all student loans have been combined and assigned to one lender. So, graduates need to apply for consolidation before the deadline.
Unfortunately, while student loan interest rates are locked in at the lower level, the grace period is forfeited. Normally, the monthly repayment schedule does not go into effect until six months after graduation. So, an individual completing college in May does have to start making payments until November of that same year.
However, if a loan is consolidated before July 1st, chances are, the first payment will be due in August. Yet, a person may still have additional options to reduce the amount owed each month.
First, select the lender carefully. Even after consolidation, and the repayment process have begun, an individual will be inundated with offers from other lenders to consolidate with their company, and receive a better deal. Most will be junk mail, if the borrower has done his/her last homework assignment.
For instance, a lender may offer consolidation at the lower interest rates with added incentives, if the borrower is a good credit risk. From personal experience, a bank may offer a further reduction in the interest rate, after three years of regular payments. In other words, do not be even one day late in submitting a payment.
Also, some financial institutions may offer further reductions; if the payment plan is set up to automatically deduct a given amount each month. So, say the interest rate is currently 3%. The borrower sets up the student loan payments to be automatically deducted on the 15th of each month from his/her checking or savings account. Now, the interest rate has been reduced to 2.75%. Then, after three years of making regular payments, the lender may reduce the loan to 2.5%, or lower.
Only the borrower can determine which bank, and what incentives are right for him/her. Certain variables have to be taken into consideration. First, what is the total amount of the loan to be repaid? Second, is the loan going to be stretched longer than the standard ten year period, or will the borrower need fifteen or twenty years to eradicate the debt?
The best advice: even though a loan has been initially picked up by one lender, or several, during the course of a person's education, he/she is not obligated to stay with that particular financial institution after graduation. Many lenders will be vying for the loan, because it is good business. A lot of students are in the same boat, with a lot of potential interest to pay the winning lender.
The mail from financial institutions will be frustrating for a while, as each tries to convince a student their repayment plan is the best deal around. Thus, students must do one last bit of financial homework. Signing on with the first lender's offer can result in paying hundreds, if not thousands, more than is really necessary.
Also, every time the interest rates are scheduled to change, like this year, the mailbox will again be inundated with offers to switch lenders, and save lots of money for the balance of a student loan. Chances are, since the interest rates are increasing, not declining, the best option is to stay put with the current repayment plan.
If a better deal seems plausible, do the math. Despite the sales pitch, lenders are not out to do the borrowers any favors. Financial institutions make a lot of money from former college students repaying federal loans. Especially at the end of every school year, the push is on to get graduates to sign on the dotted line.
One HUGE warning: DO NOT default on the loan. All bets are off, if the borrower fails to make a scheduled payment. If an individual feels he/she may qualify for a hardship deferment, go through the proper channels and apply.
Bankruptcy is almost never granted on a student loan, and lenders can garnish wages and be the first to receive any monies from an income tax refund. Plus, the amount taken from the paycheck will probably be substantially more than the monthly scheduled amount. Lenders will take as much as the law will allow, and recoup the amount of the loan as quickly as possible.
So, before interest rates go up on July 1st, take the time to do a personal homework assignment. If at all possible, lock in the lower interest rates, so the burden of student loan repayments can be reduced. Remember, ever individual has the right to choose the best lender, and plan, for his/her circumstances. The rest is junk mail.
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Hi,