Monday, July 16, 2007
Student loans and alternatives
When your student loan payments are more than you can afford, your student loans issuer can offer you options from consolidation to a step payment plan where you repay your student loans based on a percentage of your current income. While consolidation may be great, the repayment period of your student loans could take as much as 15 to 20 years according to the amount owed. Then there are temporary financial hardship forbearances when you can afford to pay nothing.
The disadvantage is the accumulation of interest that continues while the student loans are in forbearance. It's best to find out from your student loans issuer whatever you options may be. But whatever it is, never default.In a situation where you can't afford living expenses by paying student loans, ask the lender about hardship deferment to buy more time to increase income. Based on circumstances ask about forbearance too. What you need to avoid is default as it will give your children a next to zero chance of school student loans when they need them.
Most lenders dealing with borrowers are always willing to work out a method to be paid back. Not paying them will be a loss for all involved. A borrower expressing willingness to pay even a less amount or at a later time, is considered far better than the borrower who doesn't communicate at all. Therefore in case of difficulty, let them know.
# posted by karthika : 2:49 AM
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